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Question By
amymartinez2009

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Credit card payoff times
I just got my first credit card and understand about using less than 20%. My question is regarding the "closing". It might sound dumb but I just want to clarify, Do I pay it off before or after the bill comes in? I have a 300 limit and I am going to use it to pay the same bill ($95) every month since i have that in my budget already. Also, how much will my score increase by using the card this way?

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The best way to pay

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No matter what amount of the limit you use, pay the card off each month.  Since you have a low limit right now it should be fairly easy to stay on budget. 

I use my online banking bill pay for all my credit cards.  I have the e-bill sent to my bank through their online bill pay.  I have set up mine so that it pays the balance in full 5 days before the due date. That gives me about 2 weeks from the time the bill comes in to make sure the funds are there.  Never miss a payment and the balance is always paid off.  This way I never miss a payment or get caught short. 

Hope that helps

Good luck

Reply by
amymartinez2009

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Thank you so much for helping. I know I am able to request an increase over time but I dont really want to do that. Would it actually be a good idea since the whole purpose is to raise my credit score or will it hurt it?

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What you wanna do is to not let your statement cut with a balance higher than 30% of your actual limit. So step one is learning when your statement cuts every month. Once you know that info just make sure your balance is less than 30% of your available credit line before it cuts. Pay the balance in full every month to avoid interest. Over time with a good history of on time payments it will help increase your score. But it takes time, it's not an overnight thing.

Reply by
amymartinez2009

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Thank you for helping. Is interest included in the bill every month? 

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