Little balance at the end of the month for activity?

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Little balance at the end of the month for activity?

Postby Kevan » Wed Feb 29, 2012 12:45 am

Hi, I just came across someone stating the above, and I am wondering, what does one mean by that? I've always paid my balances in full right after my purchases, so have I been doing something wrong all this time? Should I have instead left a balance to show 'activity'?

A little information: I don't have an AMEX yet, but I've been using my bank's VISA card for 2 years now (just turned 20), and I think I'll be applying for an AMEX (assuming the Zync).

Oh and since I have your attention, is it possible to apply for the Zync when I am unemployed? (I am a student though.) Or should I apply for it when I have some form of part time job? (For what it's worth, I'll probably be in school for awhile, so that's why I am asking if it's still possible to get an AMEX given unemployed/part time)


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Postby i_t_man » Wed Feb 29, 2012 11:55 am

Here's what I've been told by some financial advisers and I'm sure some folks will chime in to disagree.

I've been told that contrary to popular opinion, you do not need to carry a balance to show usage and that just by the credit card company reporting every month, it shows the reporting agencies that it is an open and active account. If the account does indeed go inactive, the issuing credit card company will report it as such.

I've always paid my balances off before my statement cuts so the 0 balance gets reported to the agencies and I've managed to push my score up into the 800s. Maybe I'll leave a little balance on there next month to see if it raises my score. I doubt it will.

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Postby PlatinumAMEX94 » Thu Mar 01, 2012 3:29 am

You are better off having a low credit utilization with no balances. It is wise to have some accounts to show creditors how you pay your bills, but an account only needs to be open and have activity on it to report. Everything is all computerized, and the only time an actual person looks at your credit file is when something in the profile needs review.

Leaving a balance will not increase your score. And after you are above 800 who really cares if it goes up or down a few points. Your credit score is like your report card. You can have all A's that semester, but your overall GPA could still be really crappy. And unless you are applying to a higher education, your GPA is meaningless. Just like if you aren't applying for an auto loan or mortgage, then your credit score is meaningless.
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Postby cc_is_cash » Sat Mar 03, 2012 4:17 pm

I agree with i_t_man. All you need to do is use your card, not carry a balance. Carrying a little balance is IMHO a terrible idea. You may be paying interest on your whole balance for the next month because of it. Why throw away your money on what is likely a 15-25% rate to "show some activity?"

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Postby irvine801 » Sat Mar 03, 2012 10:47 pm

Pif is the way to go. I always leave a super low bal when my account cycles. I pay in full everytime I get a paycheck so 2 time a month. No interest charges makes me a happy camper :)
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