What should I do with my 3 credit cards?

[fuzzybean]

The Gap and Walmart are so new that I don't even have the cards yet.  The Bof A was opened in April and I'm an AU on it.

How much (or not) should I charge on them for the maximum benefit?  For the BofA, I use it for the Netflix bill once a month and hubby uses it for coffee once a month.  Obviously, it's PIF each month.

[Shogun]

Keep doing what you're doing.  Only charge what you can PIF.  Let them age.

[jamie123]

You need to use all your cards every month. The amount you use them doesn't matter too much. The way you pay them matters a lot!

You need to pay them online a few days BEFORE the payment due date. When you sign up at Walmart for electronic billing you will get a TU08 FICO score for free.

You want to have 1 card report less than 9% of ALL your credit cards' credit limits and all the other cards report zero. So for you the number would be $500+$300+$200=$1000 $1000 x .09 = $90

1 card reports less than $90 each month and all the other cards report zero.

[fuzzybean]

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@jamie123 wrote:

You need to use all your cards every month. The amount you use them doesn't matter too much. The way you pay them matters a lot!

You need to pay them online a few days BEFORE the payment due date. When you sign up at Walmart for electronic billing you will get a TU08 FICO score for free.

You want to have 1 card report less than 9% of ALL your credit cards' credit limits and all the other cards report zero. So for you the number would be $500+$300+$200=$1000 $1000 x .09 = $90

1 card reports less than $90 each month and all the other cards report zero.

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Why do I need to pay them before they are due?  I've seen other people post similar things, but wasn't sure why.

[jamie123]

Credit cards are a necessary evil in maximizing your credit scores. If you don't have them your scores will suffer. If you do have them, there is a right way and a not so right way to use them. The credit card companies would love for you to maintain a balance month to month and pay 20% interest on that money. That however, is not best for your scores or personal finances.

You need to pay online and pay almost in full a few days before your payment due date each month. You want 1 card to report less than 9% of all your credit cards' credit lines with all the rest of your cards reporting zero balances. That is how you maximize your scores.

It is only really necessary to do this if you are planning on applying for new credit in the next month or you want to see exactly how high your scores can get.

[fuzzybean]

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@jamie123 wrote:

Credit cards are a necessary evil in maximizing your credit scores. If you don't have them your scores will suffer. If you do have them, there is a right way and a not so right way to use them. The credit card companies would love for you to maintain a balance month to month and pay 20% interest on that money. That however, is not best for your scores or personal finances.

You need to pay online and pay almost in full a few days before your payment due date each month. You want 1 card to report less than 9% of all your credit cards' credit lines with all the rest of your cards reporting zero balances. That is how you maximize your scores.

It is only really necessary to do this if you are planning on applying for new credit in the next month or you want to see exactly how high your scores can get.

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I haven't used the Walmart or Gap card yet.  They are new and haven't even come in the mail yet.  The BofA I only use for Netflix ($7.99 a month) and hubby uses it for coffee once a month.  I typically just pay it when I'm in my bank account and see there is a balance on it.  It's always paid off long before the bill comes.  Is that OK?

I won't be applying for any credit until a few months from now when we plan on buyinging a new car.

[jamie123]

Yes, that will work.

Good luck!