First Credit Card.... How much of my limit should i use?

Question

My limit is $500. and i'm trying to build credit... I always pay in full each month.

I figured i'll max it out each month and send a $500 check for every bill....

is that bad?

Answer 1

stay below 50%, and make a successive pattern of paying it off in less then 60 days.  Never close the card just use it correctly.

good luck

Answer 2

Don't max it out.  Use about $150-200, and pay it off.  Save some for emergencies or indulgences.

Answer 3

If you can, and will, pay it off in full each month, you have a good program in mind.

Keep in mind that one of the items considered when determining your credit score is how much credit you have been extended and what you current balance is.

Your credit report will show the name of the card, what your credit limit is, what your highest balance has been and what you currently owe.

More information can be found by reading the article referenced below.

Answer 4

Tell ya what If I were you and could start over I would never touch a credit card if they gave it to me. Bad news you'll only want to spend what you don't have and then you'll want another card when you get behind. If you have to have one make sure just one and check out the interest and everything that goes with that.

Answer 5

well sort of, there's always interest tacked on to almost everything you do.

i had a 700 credit limit my first time and i maxed it out in a month, and never did get it paid off. my grandmother ended up paying it for me. i would say only use like 15 or 20 dollars... then pay it up completely, let it all chill for a while.

and that way, you build good credit for your future.

Answer 6

You  have a good plan, utilization only comes into play when you carry a balance so if you pay in full every month and are never late and never carry a balance your fine.

Answer 7

30% of your scores depend on your debt to credit ratio i.e. how much of your available credit (all cards combined) are you using for purchases and charges and carrying a balance.

Knowing what you told me, your credit utilization in 100%. Your scores will suffer greatly as long as your utilization is so high. Bring it down to under 30%. Under 10% is when you get the most points. It doesn't ruin your credit since balance on the card can vary month to month. If you bring it down to under 10% next month, your scores will jump immediately.

Remember even if you pay in full, your balance reported to the credit bureau is what you owe the CC companies. So if you charge $500 on a $500 limit card and pay in full, $500 will be reported. So keep your utilization under 10% if you can and your scores will jump.

Credit gets ruined when there are late payments and charge offs because that stays for 7 years. Your credit is young. As long as you are never late and pay off the balances in full each month and keep your utilization low, your scores will improve as your credit age goes up.