Plan of Attack! 30% v 9%

[Anonymous]

I have learned sooo much through the forum [most of what I was doing WRONG].

I am now trying to slowly but surely doing everything in my power to get to the 700+ club.

My current card balances are as follow

0/1000 *brand new card

746/5k (14%)

1148/4k (28%)

326/1.7k (19%)

0/1.6k *merrick bank, which I try to avoid using, but stuck on using it more and attempting to trigger an auto CLI or possibly closing it altogether?

209/2.2k (9.5%)

How should I pay these off? Should I transfer some balances? The APRs are all at about the same rate. The one at 28% accures no interest for a couple more months.

My overall utilization is at about 16% if I calculated correctly? But the 28% isn't looking too hot, I know

Any and all advice is greatly appreciated!

[Mattopotamus]

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@Anonymous wrote:

I have learned sooo much through the forum [most of what I was doing WRONG].

I am now trying to slowly but surely doing everything in my power to get to the 700+ club.

My current card balances are as follow

0/1000 *brand new card

746/5k (14%)

1148/4k (28%)

326/1.7k (19%)

0/1.6k *merrick bank, which I try to avoid using, but stuck on using it more and attempting to trigger an auto CLI or possibly closing it altogether?

209/2.2k (9.5%)

How should I pay these off? Should I transfer some balances? The APRs are all at about the same rate. The one at 28% accures no interest for a couple more months.

My overall utilization is at about 16% if I calculated correctly? But the 28% isn't looking too hot, I know

Any and all advice is greatly appreciated!

---

The good news is your overall usage is low.  I would pay off the highest interst cards first.  Try to see if you can get a soft pull CLI on the card that is at 28% usage to bring it down.

[Kevin86475391]

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@Mattopotamus wrote:

The good news is your overall usage is low.  I would pay off the highest interst cards first.  Try to see if you can get a soft pull CLI on the card that is at 28% usage to bring it down.

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I second that.

The overall objective should be to gradually pay down your balances until you can get to the point of consistently paying in full every month to avoid interest charges - you can let a small balance report on one card to optimize utilization scoring if you like, but there's no need to pay interest. In the meantime my advice would be to commit to paying all new charges in full and to only have your outstanding balances gradually decreasing.

Your utilization already isn't bad, and if you do that you'll definitely see even more improvement. Regardless, utilization is just a 'snapshot in time' element of your score with no historical impact. So first and foremost just focus on getting everything paid off and the utilization will fall into place once you do.

[Appleman]

edit - The poster above and I are giving very similar advice, just posted at about the same time - 

The thing I would first recommend is that you develop a personal budget. Many of us (I certainly include myself) have not been great about managing money or priorities. This is often why we end up in credit card debt worried about utilization etc. There are other reasons as well, medical bills, loss of job the impulse to fly to Vegas that can land us in debt.

There are a few great budgeting programs out there that are pretty easy to use. Some people like Dave Ramsey but he is so anti-credit card that he turns some off. I enjoy using credit now because instead of paying interest I am earning points or cash back.

Personally, I cannot say enough good things about YNAB. You need a budget is what it stands for. If you follow a budget you are much less likely to create new debt. This is key for future success and opportunities, Once i viewed open credit on a card as a chance to spend more, I was convinced they gave me that credit so I could spend.

For example say you pay down every credit card to zero but now all of your money is gone. You kept enough for rent but that is it. Now any expense that comes along has to go on a credit card. Back to being in debt. I certainly wish I would have figured this fact out long ago. 

It is a process that takes time but your future self will thank you.

As far as utilization it sounds like you are on the right track, less is indeed more. Best of luck!

[Anonymous]

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@Appleman wrote:

edit - The poster above and I are giving very similar advice, just posted at about the same time - 

The thing I would first recommend is that you develop a personal budget. Many of us (I certainly include myself) have not been great about managing money or priorities. This is often why we end up in credit card debt worried about utilization etc. There are other reasons as well, medical bills, loss of job the impulse to fly to Vegas that can land us in debt.

There are a few great budgeting programs out there that are pretty easy to use. Some people like Dave Ramsey but he is so anti-credit card that he turns some off. I enjoy using credit now because instead of paying interest I am earning points or cash back.

Personally, I cannot say enough good things about YNAB. You need a budget is what it stands for. If you follow a budget you are much less likely to create new debt. This is key for future success and opportunities, Once i viewed open credit on a card as a chance to spend more, I was convinced they gave me that credit so I could spend.

For example say you pay down every credit card to zero but now all of your money is gone. You kept enough for rent but that is it. Now any expense that comes along has to go on a credit card. Back to being in debt. I certainly wish I would have figured this fact out long ago. 

It is a process that takes time but your future self will thank you.

As far as utilization it sounds like you are on the right track, less is indeed more. Best of luck!

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+1 A personal budget you can live with is the way to go! It is life changing!

[Anonymous]

Mattopotamus; thanks for the advice! I would say that's one of my biggest goals for the short term = getting the 28% utilization down to under 10.

Kevin8647.... I see that that's the responsible/right/most beneficial way to use credit. And this "snapshot" thing is I think the most confusing to me.

Appleman; I really wanted to follow thru with Dave Ramsey's plan, and as of right now I definitely have my baby step#1 out of the way but he is very off putting as it relates to the credit usage and no debt whatsoever :/ not sure he goes about explaining it the right way. In terms of my monthly bills, I think for a long time I felt I didn't have "enough" to charge on my card in terms of regular bills; I have my cellphone bill, my car note, my rent (which can't be done via credit card unless I did a cash advance? Which I believe that begins incurring interest as soon as you withdraw it?), my cable/internet, childcare bill and not much else. Perhaps that is sufficient though? I feel I really need to find out the cycle ends and the day my bill is due so I can make sure I'm paying it at the right time. Would it be recommended to arrange all my CC due dates on the same day? Or at least btwn 2 days?

Musiclover; I agree!!!

[Chris679]

I set up all CC due dates for the 27th. This puts the statement date right about the 1st for all my cards. I pif right on or befor the due date and let pending charges post so I don't have a zero balance. I also pif around the 15th but that's just personal preference. Always set auto pay to at least the min payment just in case.

[Appleman]

That is the great thing about trying out multiple ways of setting up you budget. The right way is the one that works for you, take pieces that work and use those.

Never take a cash advance. 

I may not have been clear, but I try to put everything through a credit card as long as there is not a fee associated with, I could not afford to pay it off (if not you are creating debt). You are right, paying rent is something that usually has to be done with cash ot check, makes no sense to take the cash from a credit card and pay interest.

Good luck!