Not understanding cc utilization trick

[seruby]

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@Anonymous wrote:
Isn't my statement balance the same as my current balance? ? For option 2 you said pay all but 5 percent of my current balance okay I can do that on the 8th but my bill is due on the 6th won't that charge interest option one seems easier and less risky if I pay in full o the 6th then on the 7th charge five percent I just won't do it with gas I'll go to the grocery store

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Not necessarily.   It would only be the same if you don't make any new charges or payments.    Your statement balance is whatever your balance was on the statement date of the previous month, and your current balance is whatever is owed including all new charges and payments.

So using my example from above,   your statement balance would be $200.  That's not going to change until the next statement.  That's the amount that has to be paid by the due date to avoid interest.

If you charged $300 after  your statement posts, your current balance would be $500, but your statement balance would still be $200.  If you paid off $400, your current balance would be $100, but your statement balance would still be $200.  

It's a bit tricky at first.  But think of it like   "Statement Balance =  The amount I owed on the 27th."  This number isn't going to change because the 27th has passed.    "Current Balance = The amount I owe now"  This number will change with new charges and payments.

[Anonymous]

You have absolutely confused me now lol okay look my balance due on the 6th is 200 my last statement was 5/9 so I guess my statements are on the 9th of each month can i just pay 200 on the 6th and then charge 5 percent of my total limit on the 7th and be safe??? Or can I just pay the 200 down to 5 percent of my total limit and be safe??? Will both of these do what you guys are telling me to do lol

[Anonymous]

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@Anonymous wrote:
Isn't my statement balance the same as my current balance? ? For option 2 you said pay all but 5 percent of my current balance okay I can do that on the 8th but my bill is due on the 6th won't that charge interest option one seems easier and less risky if I pay in full o the 6th then on the 7th charge five percent I just won't do it with gas I'll go to the grocery store

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No. "Statement balance" is the amount of charges you had (minus payments made) on the last statement date (May 9th for your card). "Current balance" is what you have charged *right now*.

Capital One gives you a 27 day "grace period" during which if you make payments totaling the last statement balance, there will be no interest charges. For Example:

Lets say on May 9, your last statement date, your balance was $100. You will have a minmum payment of $25 due by June 6 to avoid a late charge. If thats all you pay, you will be charged interest on the other $75. If you make at least $100 in payments before June 6, you will not be charged interest. Your statement balance of $100 is what will be reported to the bureaus for your UTI, within a few days of May 9.

OK, so lets say you want to avoid interest and optimize your UTI for June. You would want to make a $100 payment any time after May 9th, but prior to June 6th. Then on June 8th, the day before the next statement closes, you would want to pay all but $15 or so, of whatever the current balance is on that day.

As I said earlier, you need to register at the capital one website for online account management to do this.

[Anonymous]

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@Anonymous wrote:
You have absolutely confused me now lol okay look my balance due on the 6th is 200 my last statement was 5/9 so I guess my statements are on the 9th of each month can i just pay 200 on the 6th and then charge 5 percent of my total limit on the 7th and be safe??? Or can I just pay the 200 down to 5 percent of my total limit and be safe??? Will both of these do what you guys are telling me to do lol

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I must stress here - do NOT rely on your mailed statements for managing UTI. You absolutely MUST register for online account management, and make all payments online. I have not even opened a mailed statement in ages. They just go straight into the trash.

[Anonymous]

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@Anonymous wrote:

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@Anonymous wrote:
You have absolutely confused me now lol okay look my balance due on the 6th is 200 my last statement was 5/9 so I guess my statements are on the 9th of each month can i just pay 200 on the 6th and then charge 5 percent of my total limit on the 7th and be safe??? Or can I just pay the 200 down to 5 percent of my total limit and be safe??? Will both of these do what you guys are telling me to do lol

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I must stress here - do NOT rely on your mailed statements for managing UTI. You absolutely MUST register for online account management, and make all payments online. I have not even opened a mailed statement in ages. They just go straight into the trash.

Okay I am now registered online current balance is 223, I lost my debit card so i had to pay a couple things on credit... Minimum payment says 0 dollars due june 6th, available is like $76, last statement balance is 0 dollars as of may 9th since i paid in full.

So after taking a closer look every statement is on the 9th 3/9, 4/9 and 5/9 and my due date is june 6th it says minimum payment is $0 Idk why...So now that we have the actual numbers and dates... How do I go about this credit utilization trick? I was thinking paying in full the 223 On june 6th and then charging 15 dollars on the 7th so on the 9th for my statement it will show 15 dollars instead of 0 is this what I should do??? Or should I pay the 223 down to 15 dollars on the 6th?? Enlighten me thanks (Reminder I am a credit beginner lol this is all very new to me)  Sorry for asking a billion questions you guys and girls are very helpful though

[Anonymous]

Also not sure if this matters but when i open up my 5/9 statement to look at it it shows this

Previous balance: 0  - Payments and credits: 196  +  Fees and interest: 0 +  Transactions 196  = New balance of 0

[seruby]

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@Anonymous wrote:

ay I am now registered online current balance is 223, I lost my debit card so i had to pay a couple things on credit... Minimum payment says 0 dollars due june 6th, available is like $76, last statement balance is 0 dollars as of may 9th since i paid in full.

So after taking a closer look every statement is on the 9th 3/9, 4/9 and 5/9 and my due date is june 6th it says minimum payment is $0 Idk why...So now that we have the actual numbers and dates... How do I go about this credit utilization trick? I was thinking paying in full the 223 On june 6th and then charging 15 dollars on the 7th so on the 9th for my statement it will show 15 dollars instead of 0 is this what I should do??? Or should I pay the 223 down to 15 dollars on the 6th?? Enlighten me thanks (Reminder I am a credit beginner lol this is all very new to me)  Sorry for asking a billion questions you guys and girls are very helpful though

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You've got a grasp on it.    

Last statement balance of 0 is indeed because you owed nothing on 5/9.   Since your statement balance is $0, you don't have to worry about being charged interest.  I would personally pay down the $223 to $15. As I said before, I prefer this method because I don't have to worry about something not posting on time.   Since you have no minimum payment on your previous balance ($0), you don't have to pay it down by the 6th:  You just have to make sure it's paid by the 9th.   However, you can definitely pay it by the 6th and not use the card until the 10th if that makes you feel more comfortable.

[Anonymous]

Okay great so I'll pay that down to 15 on the 6th! So my utilization will only be 5 percent on my statement and I will do this every month from now on with this card. This will benefit me more then paying it to zero right

[seruby]

Correct!   See, you've got it.     So what you'll do on your next statement, since you're statement balance will be $15, is pay that $15 immediately (like the 11th or 12th - basically once you see it the due date change online) so it's out of the way and you won't have to worry about interest or being late.   Again, this is just something I do to be safe, but not really required.  Then on July 6th, pay your current balance down to $15 just like you're going to do on June 6th.

And remember, you don't have to stay at 5%.   Just keep it under 10%.  Having a steady number is good though since it helps with budgeting.

[Anonymous]

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@Anonymous wrote:

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So after taking a closer look every statement is on the 9th 3/9, 4/9 and 5/9 and my due date is june 6th it says minimum payment is $0 Idk why...So now that we have the actual numbers and dates... How do I go about this credit utilization trick? I was thinking paying in full the 223 On june 6th and then charging 15 dollars on the 7th so on the 9th for my statement it will show 15 dollars instead of 0 is this what I should do??? Or should I pay the 223 down to 15 dollars on the 6th?? Enlighten me thanks (Reminder I am a credit beginner lol this is all very new to me)  Sorry for asking a billion questions you guys and girls are very helpful though

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Yes, with Cap One your statement date will always be the same day of the month.

Either of those methods will work just fine for you. As long as your account shows that small balance on the 9th, any method that achieves that is good.