Help me figure out how to have the best utilization (please)

[Anonymous]

Hi - I'm trying to figure out how to post the best utilization for my credit cards.  I know I need to have a balance post on my statement, but I don't want to pay interest and I'm having trouble wrapping my brain around how to get this done.  Can someone help me?  Here are the cards I have that I want to post a balance on the statements:

Card 1 

Statement Date 13th 

Due Date 10th

Card 2

Statement Date 3rd

Due Date 28th

Card 3

Statement Date 7th

Due Date 4th

On what dates should I post a charge so I see a good utilization?  I want to pay all in full on the due dates. 

Thanks!!

[takeshi74]

You don't have to carry a balance to report a balance.  Here's how it works:

• PIF after statement end and before the due date and you pay no interest but the balance reports on statement date.
• PIF before statement end and 0 balance reports.

Of course, this assumes that your cards all report on statement date.  Most do but there are some that report at other times.

For optimal scoring let only 1 card report ~10%.

[Anonymous]

I understand that - but because the statement dates are all after the due dates, I'm assuming I have to have a balance in that short window.  

For example, on Card 1 ...  Due date is the 10th of the month.  Statement date is the 13th.  Should I charge something on the 11th, wait for a statement on the 13th and then pay in full?  Or am I confused and NOT understanding it correctly?

[goldengopher1991]

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@Anonymous wrote:

I understand that - but because the statement dates are all after the due dates, I'm assuming I have to have a balance in that short window.  

For example, on Card 1 ...  Due date is the 10th of the month.  Statement date is the 13th.  Should I charge something on the 11th, wait for a statement on the 13th and then pay in full?  Or am I confused and NOT understanding it correctly?

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Ok, if due date is 10th, statement date is 13th what you should do is:

Just pay off your PREVIOUS statement balance that is due before or on the 10th. I'll give you an example, I have only 1 CC right now a Discover with CL 1250. Due date 11, statement date 16.

My current balance due on the 04/11 is $51. Lets just say my current total balance is $1051, which means I charged $1000 AFTER my last statement cut. 

What I would do is just pay $51 before the due date of 04/11. I still have $1000 left on my balance, right? If I dont do anything before the 16th, Discover reports my previous payment as OK but when my statement cuts I have a very high utilization. So before the 16th I would pay down to around $30-50, a small fraction of the amount just to allow them to report a small balance and show that I use my card.

Sorry if my explanation is a little confusing, but that's how its done. It's just a game you gotta play right.

[benandjerry]

your statement cuts on the 13th. It's not due until the 10th of the next month, so almost 4 weeks after the cutting of the statement.

[goldengopher1991]

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@benandjerry wrote:

your statement cuts on the 13th. It's not due until the 10th of the next month, so almost 4 weeks after the cutting of the statement.

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Yeah, I think he's confused. When the statement cuts, the due date to pay that particular balance is at least 21 days AFTER the end of the statement. OP, in my case:

Feb 11: pay Jan 16 statement date

Feb 16: Jan 17-Feb 16 statement date cuts, and they report to CRA whether I paid my Jan 16th balance on time (ie before Feb 11)

etc

makes sense?

[Anonymous]

Yes, I'm a moron, THANK YOU.  LOL

I just pulled up some old statements for Card 2 - and was able to make sense of it.  I'll explain how it made sense to me in case it helps someone else. 

Billing Cycle Mar 4 - Apr 3.  Statement Date Apr 3.  Due Date Apr 28.  

So .... I'm still in the current billing cycle.  My credit limit on this card is $1,500.  If I want to post utilization between 1% - 7% (which I understand is the best), then I want a balance to appear on Apr 3 between $15 and $100.  So I pay the card now to have a balance in this range.  Then between Apr 4 and Apr 28, I pay the rest in full.  This way, I post a statement balance with a good utilization, but never pay interest.  

If someone can confirm that I now understand it correctly, that would be great.  

[benandjerry]

You got it! Except I would recommend to pay the excess (above the desired utilization) before april 3 (eg march 31), not ON the date. If something goes wrong with the payment you end up with a report with high util. 

[goldengopher1991]

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@Anonymous wrote:

Yes, I'm a moron, THANK YOU.  LOL

I just pulled up some old statements for Card 2 - and was able to make sense of it.  I'll explain how it made sense to me in case it helps someone else. 

Billing Cycle Mar 4 - Apr 3.  Statement Date Apr 3.  Due Date Apr 28.  

So .... I'm still in the current billing cycle.  My credit limit on this card is $1,500.  If I want to post utilization between 1% - 7% (which I understand is the best), then I want a balance to appear on Apr 3 between $15 and $100.  So I pay the card now to have a balance in this range.  Then between Apr 4 and Apr 28, I pay the rest in full.  This way, I post a statement balance with a good utilization, but never pay interest.  

If someone can confirm that I now understand it correctly, that would be great.  

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I think you got it, except for the last part (unless I missunderstood). If you have a due date April 28, today is March 28 so it means you have a due date today as well for your Feb 4- Mar 3 statement date. Make sure you pay that right now.

For your current billing cycle Mar 4 - April 3, you only have a few days left before the statement cuts next Thursday. Lets say currently of your $1500 CL, you've used up $1400. Very high utlization, right? So on April 1, you'd wanna pay almost all of it off and leave a small balance ($50 is ok). When your bill cuts on April 3, you get your CC bill the next day saying you got a balance of $50.

Important: 2 things happen on April 3: Your CC company reports if you paid your Feb 4-Mar 3 statement on time  or not (ie on time is by today March 28), and your April 3 balance gets sent to you in a bill, and this will be reported on May 3 whether you paid this balance by April 28 or not.

hope this helps.

[benandjerry]

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@benandjerry wrote:

You got it! Except I would recommend to pay the excess (above the desired utilization) before april 3 (eg march 31), not ON the date. If something goes wrong with the payment you end up with a report with high util. 

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Addition: as long as you pay the full balance that is stated on the statement before the listed due date, you do not owe any interest*. If you pay less than the amount owed, you will start to accrue interest over the difference.

*exception to this are the CreditOne credit cards, they start to charge interest from the moment you make a purchase. One of the reasons I am not touching CreditOne with a 10foot pole.