<30% of Balance Question

[wop0101]

I keep reading to keep <30% balance on revolving credit, my question is if that is weighted monthly or just a snapshot of the amount at any one time. I have a card with rewards so I typically max it out ($500) over a couple weeks then just pay it off in full online (never keep a balance for interest). Which of these 2 options should I practice:

1. Spend $150 a week -> pay the balance in full online -> rinse and repeat (my preferred choice due to rewards earned)

2. Spend $150 a month -> pay the balance in full online

Is the balance looked at on a monthly basis or just at any random point in time? <--I guess this is the simple question I just should have asked but I've done all this typing so I hate to erase it...

[user5387]

The key balance is typically that of the statement date, which is reported to the credit bureaus.

There are a few CCs that report the current balance at the end of the month, which is different than the statement date.

[wop0101]

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@user5387 wrote:

The key balance is typically that of the statement date, which is reported to the credit bureaus.

There are a few CCs that report the current balance at the end of the month, which is different than the statement date.

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Okay, so the 30% rule only applies to the statement balance and is not an ongoing snapshot of current activity? Meaning: how much I spend a month is inconsequential as long as the balance is paid in full by statement date, correct?

[Revelate]

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@wop0101 wrote:

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@user5387 wrote:

The key balance is typically that of the statement date, which is reported to the credit bureaus.

There are a few CCs that report the current balance at the end of the month, which is different than the statement date.

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Okay, so the 30% rule only applies to the statement balance and is not an ongoing snapshot of current activity? Meaning: how much I spend a month is inconsequential as long as the balance is paid in full by statement date, correct?

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Correct 99.9% of the time, and the remaining 0.1% is irrelevant beyond the incredibly short term (occasionally if there's a big change in your usage pattern, BOFA and a few other lenders will do a mid-cycle report, but this isn't a common event).

[wop0101]

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@Revelate wrote:

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Correct 99.9% of the time, and the remaining 0.1% is irrelevant beyond the incredibly short term (occasionally if there's a big change in your usage pattern, BOFA and a few other lenders will do a mid-cycle report, but this isn't a common event).

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Awesome, thank you to both of you. +1 internet points each

[user5387]

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@wop0101 wrote:

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@user5387 wrote:

The key balance is typically that of the statement date, which is reported to the credit bureaus.

There are a few CCs that report the current balance at the end of the month, which is different than the statement date.

---

Okay, so the 30% rule only applies to the statement balance and is not an ongoing snapshot of current activity? Meaning: how much I spend a month is inconsequential as long as the balance is paid in full by statement date, correct?

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Yes, that's right.

One additional point -- there's nothing magic about 30%.  For the best scores, you want utilization lower than that.  For example, lots of folks around here pay off all their cards save one before the statement date, and they let that one report a small balance.

It's also true that individual lenders may or may not like what they see on your reports, independent of score.

[takeshi74]

I.e. 30% is the recommended max.  Ideal will be much lower -- typically 10% or less.