Just because you have available credit, doesn’t mean you should use it. In fact, if you want to improve your credit score, you are encouraged not to use it.

Getting caught in high balances looks unfavorable to credit bureaus. They see it as your credit utilization ratio (the ratio of your credit card balance to credit limit) and use it to determine how responsible you are with money.

If your credit utilization ratio is 30 percent or less, the credit bureaus see it as if you’re spending within your means. Here’s an example….if you have credit cards with a combined total limit of $1000, avoid charging more than $300 at any given time.

When your credit utilization ratio is over 30 percent, you are over what’s recommended and it’s time to prioritize paying down your credit card debts to increase your amount of available credit. This will help increase your credit score.

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