This topic contains 3 replies, has 2 voices, and was last updated by 
fontanaman 6 years, 6 months ago.
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Hello all!
I recently turned 25 and thought it was about time to get my credit back on track. I was less than smart when I turned 18.. have a few accounts from early days that went negative and wrote off.
After landing a great career last year, making good money, nice vehicle, nice rental home, ect I figure the last peice of my life is getting a good credit score. Last I checked, years ago – I was 540 or so.
I did have a few questions, however – I got myself a Capital One secured mastercard. I put down a $500 deposit.
I keep reading only carry a balance of 30-40% of your credit limit. Now when I see “Carry” I assume that’s how much you can roll over into the next month? As I said, my limit I put on this card is $500. If I was to spend $400 or so and pay it off each month, does that 30 or 40 % rule apply??
I was going to link my utilites to this card for auto payment. Roughly $380-430 a month depending on how much the Central Air runs in the home, as well as how many long showers I take!
I’m about to get another secured card from Bank of America (one of two checking account banks I use) and I plan to put a $2,000 limit on this card.
But depending on how that 30% rule applies, I may put less depending on graduating terms (something C.O. does not do, apparently).
Thanks!
Hello BustedVisaCard, and welcome to the forums.
It is recommended that you keep your credit card balance below 30% (some people say 40-50%). I try to keep it below 30% just to be safe. This does not mean you need to CARRY a balance each month, it means you should only USE 30% or less of your available credit at any given time. If your credit limit is $500, and you don’t want to use more than 30%, you should not spend more than $150. Lenders want to see that you are not using too much of your available credit because this means you could get into financial trouble. Save yourself the fees and pay in full each month if you can, just don’t spend more than 30-40% of your limit.
I suggest you wait until you get your 2nd card with BOA so you can pay all your utilities with the card (or just pay $150 of your bills with Capital One). Also, you should check your credit report at least once a year, if not more. The only way you can improve your score is if you know where you stand. Checking your report will give you a better idea of what you need to work on, not to mention you can check for inaccuracies. You can get a free credit report from the three credit bureaus here: https://www.annualcreditreport.com/ (don’t be fooled by other sites offering the same deal, this is the official one!).
Hmm well that 30% damper sure does put a damper on things!!
I guess just to toss up a different balance each month with it, I’ll use it for a new bill each month. I think my highest bill alone is $200 with the electric bill. Other than rent/car payment.
As for the BOA card.. I suppose I could toss $3k into that account to give me a better 30-40% buffer zone.
Paying off the cards each month is not hard as long as the balances are $2500 or less (what I normaly spend each month on food/gas/bills). Just that dang 30% mark. At least the BOA will consider giving back a despost and moving me up in the world to an unsecured card.
I’ll check out the credit report link you posted.. I do need to get setup in a program to check it now that I am out to improve the finer things in life.
Anywho, thanks for the reply! This is quite fun but at the same time a PITA with the whole credit world. But only way to buy a home these days….
Thanks Again!
Yeah, I agree. Sometimes I wish I didn’t have to think about all this credit stuff. It’s such a waste of time sometimes, though I have to say I do enjoy it every once in a while. It’s sort of like a competition you have to win…
What I do sometimes is spend 30-35% of my limit, pay it off and then use it again (within the same statement period). I heard a credit expert mention this on TV once, so I do it whenever I need to spend more than 30% during the same month. It makes sense when you think about it, as banks report your card once a month to the credit bureaus, so they report whatever your balance is during that day.
Good luck and keep us informed!
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