[USER]

Just wanted to share something regarding credit cards. We are responsible cc users and do so to maximize cash back and points.

One card gives high cash back for groceries so it’s our grocery card and also helps us track monthly grocery spending, another for recurring bills again helps us track recirrent spending plus points etc.

Cards are always paid off every month.

Once a year we have what I call heII month where a bunch of annual payments come out at once.

To avoid “high credit utilization” for that one month we request a credit increase limit every 6 months or so. It takes 30 seconds to do in the cc apps and is usually instant.

This increase is usually $500-1000 per card. What I’ve noticed last year and confirm again this tear is that if I request the increase during the heII month when the balance is high the increase is a lot more like $2500-5000 each.

During this month we typically see a small dip in our excellent credit scores, but after these last two increases I don’t think we’ll be even close to having a bad credit utilization ratio (I think its something low like 20%, I was always told it was 30% or 35%).

So for those responsible cc users if you are looking for a way to increase your credit limit do so every 6 months and time it around a high spending month like maybe the holidays or after a trip, etc when the balances are higher.

[Num]

If you pay it before you get a statement then it doesn’t affect your credit score since it never gets reported to the bureau.

So, if you pay it in full before you get the statement, your credit utilization will be essentially $0.

[Shiao]

The companies want you to spend more and gladly increase limits.

They make money off all purchases you make, and even more off interest.

[Karl]

How much does your score dip during high utilization?

I could care less if mine goes from 828 to 798 once in a while, it’s still high enough to obtain the best interest rates in most cases.

[Allison]

I think you’re reading too far into it. Soooo many other factors play into your score. I have run 30-60% utilization for years now.

Always pay it off.

And still maintain 800+.

[Sage]

My credit score is between 830-850 depending. Sometimes I can get it up to 850 and it always drops again.

I never have any negative marks and pay things regularly, but I’ve found that when expenses start piling up and I run a balance…maybe 5k, then my rating goes up.

Always drops again when I pay it down to 0. They want you to carry balances.

[John]

It’s a blip in your score. It only matters if you’re applying for credit at the time.

Alternatively, you could make a payment before the account is closed out for the month and will never show on your report.

[Washington]

Why does anyone care to that extent about credit utilization. If you pay it off every month so what if your credit score change by a few points intra month?

I don’t think this is something that needs to be done quite frankly.

[Lisa]

I don’t have the answer regarding the cards, but I have another suggestion. Contact seller iof the annual bill companies and see if you can change the billing cycles of some.

I had this situation a few years ago, and managed to get the insurance company to change the billing cycle to 6 months, and then annual thereafter.

Doing something to assist the due dates may be beneficial.

[Corey]

I’ll be honest, I used to care about my credit score, but now I barely ever glance at it or care. I’m not sure what I’ll ever use it for in the future.

Once you reach FIRE credit seems silly especially if you have great margin rates through a brokerage.

Don’t get me wrong, I use CC ‘s for 95% of my purchases, each of my 2 cards have $30k limits I just don’t plan on changing them or needing to for any particular reason.

[Author]

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