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How to Balance your Credit Card & Credit Score

2013/03/03 by

Ever heard that as long as you’re using 30% or less of your available credit limit then it’s no harm, no foul to your credit score? Well, new advice is recommending keeping your spending down to more like 10-20%. That might sound like a big jump to many people, and some of you might be sitting there thinking, “Nope. There’s no way, no how I can reduce my usage by 10%, it just ain’t gonna happen,” well I’ve got some good news for you. Turns out that chopping your spending isn’t the only way to make the numbers work in your favor, and result in a decent credit score. Dana Dratch of Fox Business gives some insider tips and tricks to help readers hold a high credit score while still using their credit card– and not necessarily slashing their usage rate, either. Most of Drath’s recommendations will take a little bit of time to sit down and accomplish, but in the long run will help your credit score look better and better. And, her tips just might make you a more reliable borrower! Check out the Fox Business article:

“Here’s an axiom familiar to borrowers: Using too much of your available credit hurts your credit score. A personal finance rule of thumb that goes with it says that for a good credit score, keep your “credit utilization ratio” — what you use versus how much you have to use — below 30%. The rule applies to each card individually, and to the cumulative limits of all your cards.

So if you have a card line with a $10,000 limit, for the best credit score, don’t carry a balance higher than $3,000. Simple, right?
Sorry, but no.”

Click here to get some highly-recommended credit limit tricks that will keep your credit score looking pretty.

It’s completely your choice to follow some of these tips, but I can tell you from personal experience that you might be pleasantly surprised to try even just one, and see how easy it was and the difference that it might make. I encourage anybody who does go ahead and give some of these tips and tricks a whirl to share your experiences with us back here!

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