3 Thoughts on Does paying off the balance on your credit card each month improve your credit?
  1. Reply
    July 4, 2011 at 3:50 am

    Paying off your debt in full will give you an excellent credit rating quickly. However, if this is not possible, paying AT LEAST the minimum payment, if not more will give you a good credit rating.

  2. Reply
    July 4, 2011 at 4:43 am

    When you pay off your debt every month, it makes you look great. It shows you are responsible with your account. Just because you don’t let it gather interest is no reason to think you’d be a risk. If you want to have to pay interest, do it, but any type of “credit” you keep up with is great. Since it is a credit card, it will show up on your credit report regardless of how much you pay each month. What matters is there are no 30-day, 60-day and 90-day or longer due accounts. You’re fine. Wish everyone had your savvy.

  3. Reply
    July 4, 2011 at 5:00 am

    You don’t need to carry a balance on a credit card to have a good credit score. Paying your bill off in full is the best way to keep your finances in shape and build your credit at the same time. Or, keeping balances low on credit cards. High outstanding debt can affect your score. Maxing out your credit cards could lower your average score by as much as 70 points.

    A credit card is a great financial tool. It can be more convenient to use and carry than cash, and it offers valuable consumer protections under federal law. At the same time, it’s a big responsibility. If you don’t use it carefully, you may owe more than you can repay, damage your credit rating and create credit problems for yourself that can be difficult to fix.

    A good credit rating is a crucial part of achieving financial independence. By improving your credit rating you can save thousands of dollars in interest charges on your auto and home loan. You can also get approved for new, low interest loans and credit cards.

    Therefore, delinquent payments can have a major negative impact on your score and the longer you pay your bills on time, the better your score.

    Meanwhile, please, don’t open a number of new credit cards that you don’t need. New accounts will lower your average account age, which could actually lower your score by up to 10 points.

    Best wishes!

    Credit Professional

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