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Question By
infernoboyx

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Is a high utilization (even 100%) relevant even if you can pay off the entire balance every month?
I've noticed a lot saying never to exceed 30% of your available credit line to build a good credit score. What I fail to understand is why this matters if I'm able to pay off my balance in full each month even at 100% utilization. Does it actually affect the score badly if I'm doing this?

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YES!!

Helpful to 2 out of 2 people

Utilize the tools here.  High credit card utilization shows up as high debt, which it is since a credit card is essentially a loan.  If something happens (you have heard of "Murphy's Law", haven't you?) and you can't pay off the card in full as you are doing now, you have nothing to fall back on.

Do try keeping your utilization down to the recommended rate (I keep some cash around and use checks) and you'll see your credit score go up significantly.  Potential creditors like to see that you have a "slush fund" available, and you don't have one right now.

Reply by
infernoboyx

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Ah, thanks. I actually do have a "slush fund". I just decided to build credit I'd use the card instead of anything else. I guess I understand how that might look a bit odd even if I know I'm sure I'd always be able to pay it off. I only use it if I readily have funds available to pay it off--I don't like looking at credit cards as "free money" to spend whenever I want.

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