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Question By
TheRealAzoth

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High credit card utilization but paid every month bad for my credit?
I have only once credit card that I use for all purchases all month for the points/miles so it has a high credit card utilization percentage of about 40%. The card is paid off in full every month. CK is flagging it as possibly negatively affecting my credit. Could it be?

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Top Contributor
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The only day your balance matters is on the closing date. You can max out your card every single month, as long as your utilization is under 30% on the closing date (generally three to five days after the due date). You say it's paid in full every month. Simply adjust the day it's paid and you should see a huge improvement. Good luck to you.

Top Contributor
1884 Contributions
3670 People Helped

Get another card.

By getting another card that you can rotate monthly you card has a chance to report the lower balance.   If you do that and only use 1 card at a time, then pay it off and let it report a 0 balance the next month your score can improve tremendously. 

Why?  becaue if you use your card every month and it reports a balance each month it may appear as if it never gets paid off. 

i.e.  if you have a $5K limit and you charged $1500 last month (30%)   You paid it off and use the card and it reports $1450 this month, to the credit reporting agency it appears as if you only paid $50 towards the balance.  So it appears as if the balance has not been paid down.  The balances only count on the day it is reported. Other acctivity such as how much you charged or paid are irrelevant.

I have two cards that i use only for gas and auto expenses.  Right on the front of the card I Write "Odd' or "Even" with a sharpie. I only use the Odd card on Odd numbered months. The same wtih the Even card.  This system works well for me. 

Hope that helps.

Top Contributor
47 Contributions
27 People Helped

It will hurt.  The only ways to fix this are to either use debit (and lose the points) or to pay off the current balance before the closing date.  Which, if you have the spare cash to do so, you can have close to a zero balance when the CC company makes the monthly report.

The transaction month would be the harder month.  You would be paying off the previous month's bill and the current month's bill all at once.  If the money is sitting at essentially 0% in the bank, it isn't like you are foregoing much earnings.

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