Everyones going to have a different approach with slightly different results, so I'll explain what I did. I guess what you might call my approach is more of a delayed gratification situation, live life and use credit as needed, and then go for the icing on the cake kind of deal. It was a decade or two in the making, fine tuning myself along the way. My short term advice is to just live life, and to get your life in order as a priority. Everything will fall into place, but with today, you have the advantage of knowing the opportunity ahead of you.
My long term is more of what is below...
Working from let's say a 620-660 average as younger (20's), I didn't hold much of any real credit. No real lines worth a darn, and I didn't really use them much. But, it was free and the account(s) were aging. I wasn't pursuing credit, but when needed it was available at a cost. As my income grew up due to age and experience in my field, I was able to acquire more income and at times more debt, usually for strategic purposes. Some for fun. For example, I dumped a gas guzzler for a fuel efficient vehicle, and the gas savings alone paid for the loan monthly. Did this again for P2. Timeframe is now about 10 years later. Secured a home, refinanced the rate down when made sense. Acquired an energy efficient loan to acquire geothermal, that saved on annual heating costs in my neck of the woods. Etc, etc. Everything was shuffling of the papers as I call it. More efficiency on top of more efficiency, to justify the securing of more loans. What lenders want to see, is your back up against the wall to know you can handle the debt load, and they want to see a debt load that is of a wide caliber across many lending fields.
As time went on, scores were ready and rapidly improving, and we would secure a card here or there. No big deal, $5000 here, less than $10,000 there. By doing nothing more than living life, taking smart loans as needed, and gathering a card here or there, our FICO moved towards 750-780+ and we were at that time sitting on I'd say about 80k in credit. Without too much trying or thinking about things.
As time progressed (another 5-10 years), we really didn't need much of any anything at that time. Credit was good, home interest rate was as low as I was going to secure. Vehicle rates low, then paid off. Debts secured, then paid off. It was a constant cycle of showing the lender that they can make money off my debt, but I could repay it back in a relatively quick timeframe. Many closed accounts secured by new ones when it made sense, and always paid on time every month. So, at that point in time I decided to abuse my credit. Why not, it was approaching 800 at this point, and offers were coming in left and right. I decided to educate myself in how to enjoy my credit score. How to abuse it. How to utilize it as the powerhouse that it was, and how to make the numbers dance. How to enjoy the icing on the cake.
I picked a few more cards, and the total credit inventory started to increase again. Now we're approaching well over 100k easy, and we still aren't even taking advantage of anything 5/24 or relatively close. We aren't yet pushing our availability of credit lines. It wasn't a consideration to test this at all, but instead just going about our business, still credit lines with no annual fees, but I was learning.
Then, I get a real taste of something I like. And it's repeatable.
We're about to paint the walls in our house. We were very lucky, and I say this respectfully and with humility, to acquire the home in which we received. Our main space comes with cathedral ceilings, and to paint our home, would costs many thousands of dollars. Our friends were quoted $5000 for less square footage and yet with a similar setup. Now I've painted rooms, and my prior home no issue at all, but this time it requires scaffolding to reach areas adequately. Home depot, $1000 two tier scaffolding, heavy duty, $1000. We do it ourselves.
Instead, we secure two credit cards that offer a $200 welcome bonus offer, P1 and P2. This reduces our total cost down $400, and takes about a week for us to complete. And these new lines offer to us, $20,000 each to boot. We start to approach the $150k credit range now, so credit utilization is starting to become a non-issue to our score.
We then proceed to take advantage of another cash reward bonus, which is a nice addition. It addes a nice monetary return on spending we would have already done, and again offers more total credit availability. Credit cards are no longer offering just $5,000 or so, but approaching 20k again and again. Still no yearly fees up unto this time.
Then, we escalate. Big time. Hotel rewards...
We cycle X,XXX per month anyways in normal spending, like most families, so we are primary candidates to earn hotel line rewards.
P1 and P2 for hotel card one:
$2000 in vacation points become available. Depending on location, you can increase the dollar value when points are used. Want to cash out with gift cards, you can gain much less, but we're going for the vacations.
P2 and P2 for card two:
$5000-$6000 in vacation points become available for a top of the line location we intend to book. Ten days, two cards. No cash out option. None needed.
P1 denied, P2 secures card three:
Enough vacation points to secure $2000 in vacations in the welcome offer alone. We utilize this card monthly, and by the time we intend to utilize the points again, another vacaton for $2000-$3000 will be made available on top of the above the $2000 vacation.
Our vacation trips are booked out to 2028, and likely beyond. We pay some annual fees, but not many. We know the rules of the point systems, how to keep them active, and when to utilize them. The 5/24 credit card rule should be completely vanished on P1 and P2 by the time we are ready again, so we can roll against the other hotel lines we weren't able to secure today.
Combine this all with bank welcome offers, and it's a nice wonderful perk.
Now I get this isn't a ton of money. Get a second job, and you will earn this same value in no time. But, that's not the point. It's the point of what I feel is addiction, opportunity, and excitement, to take advantage of nearly free, and to use the power of your FICO score that you built up over time. For little effort. By simply using your mind, shuffling money around, and nothing more. Making numbers dance.
This is the icing on the cake, and it's available to everyone. I'm not trying to gloat or brag, I've shared this with SO many people, and yet they will not take advantage of these opportunities in my circle. We've secured a handful of weeks in vacation already. Anywhere in the country, or outside. It's available if you want it.
Meanwhile, my extended family and friends, somehow they're excited earning their 2%-5% cash back credit cards. At the end of the year, it's something, but it's not an opportunity like this. They'll say I earned maybe $600 on my visa. I'll tell them how to accrue ten times that in vacations in the same year, and yet they still don't act. It's strange to me.
Sorry for the long winded reply. I believe you should stay the course and keep you and your family first. When things are aligned, abuse that score and take it for everything you can. I don't need a score today. I understand it's importance, I will defend it fiercely, but I don't need it to secure an already excellent position. I secure it as the icing on the cake to that excellent life. They want to give it to us. I say we should accept their offer.
I say to you now, unless you are absolutely secure in your life today with everything credit wise from home to cars and all things between, keep your credit profile below red line and a bit less. When you have everything secured, push it to the limit. Let the heat die down, and then push it again. Rinse, repeat.
That's just my opinion, and my story. I wish you all the best.
$XXX,XXX in credit lines. First digit isn't a one or two.
4-5 weeks in free credit reward vacations, booked through 2028.
$X,XXX in bank rewards in only 12 months.
I like FREE...
800+ FICO.
Making all numbers dance on a financial ledger.
Abuse that score responsibility for maximum gain.
