- Centurion Member
- Posts: 1468
- Joined: Tue Jul 31, 2012 12:20 pm
- Location: United States
I don't think we've cleared it up, entirely. What everyone is saying is this:
There's a difference between the date your credit cards report to the credit reporting agencies, the date your account closes every month, and the date your payment is due. For example, my Sapphire Preferred closes on the 18th every month and reports on the 19th or so. My payment for that month's charges is due on the 15th of the next month. For an ideal FICO, I would make a payment to the card before the month closes, but not for the full balance. I'd leave between 1-5% of the overall limit of the card.
Let's say I have a $1000 limit on the card. If I charged $500 (50% utilization) that month, I'd pay down $475 of it and leave a $25 balance - 2.5% utilization. I would let the month close with that balance remaining. That balance then reports to the agencies. Once the month has closed, I can pay off the remaining balance, leaving a balance of $0, and start over for the next month.
But, here's the kicker - none of this matters. Unless you're borderline on a mortgage or car loan and need to maximize your FICO, there is absolutely no reason to even worry about it. As long as you pay your full balance by the payment due date, the bank doesn't charge you interest and your credit report is clean as a whistle.
So, if you're interested in maximizing your rewards, pay all of your balances down to zero, let 1-5% report on one card, and apply for the rewards card you want. Once you get that card, you don't have to worry about your score again until it's mortgage/auto loan time. Charge everything from soup to nuts (assuming you're not allergic to nuts) and pay it off every month before the payment due date. Voila! Rewards maximized.
[RIGHT][size=100]- Sapphire Preferred - Freedom - Ink - Platinum - Everyday Preferred -[/size]