@Anonymous wrote:
Hi guys, I'm an avid reader of this forum but a first time poster. I'm rebuilding and have four credit cards of my own, as well as being an authorized user on my sister's card. What's the absolute best way to maxmize my score in the coming months, should I let a balance report on just my sister's card and pay all of mine to zero before the statement cuts or should I let one of my cards report a small balance as well as hers? I'll be keeping the total utilization around 5-7%, just wondering if it hurts my score slightly letting more than one card report a balance, and if my sister's card counts towards that.
Thanks!
Hello and welcome,
Everyone's situation is different and there is no one size fits all approach to this and therefore no "ideal" number but what seems to work well for most people is to have only one of their cards report a small (<9% of it's credit limit) balance each month and then pay in full before the due date. You can use it as much as you want during the month but what's important is the reported balance because for most cards whatever is reported on the monthly statement is what is used to calculate utilization for the month.
You might have to play around with the percentages for a few months to see what works best for you. Some people say that 1-3% utilization helps the most. For others it might be 5-9%. As I said it's not one size fits all.
On any other cards always try and have them report a zero balance each month. That doesn't mean you can't use them just make sure that the desired zero balance on these accounts is achieved several days before their statements post.
Along with individual and overall utilization, FICO also scores the number of all types of accounts reporting a balance.at any one time Making sure less than half of all your accounts report a balance helps most people.
Now this approach really isn't necessary if you're not looking to apply for any credit in the near future or unless you are trying to tweak your score for maximum effect but some folks do this as a hobby just to see how high they can get their score.
