Do you pay the entire bill before the statement closes?
 

Just curious if you do this or if to improve your FICO, you keep a small amount unpaid just so the CC company reports some usage?

Never leave any unpaid! Pay it all!

Whether paying in full before or after the pay period closes - with a $0 balance due - or running a small "token" balance makes a significant difference to ones FICO score, is probably pretty negligible.

I used to make a payment each time a charge appeared! Now I pay once, the day after the period closes.

None of this is as significant as the big ones they spell out for us: never pay late; use less than a third of ones max. credit; have a lengthy good credit history, etc.

I keep my money in an interest bearing account and schedule the payment in full for the day before the bill is due. That way I get the most out of my measly 3.0% APR in savings and never get any of the 18% APR on my CC.

I never pay before the statement closes.

Are you able to keep your bill less than 35% of the limit?

I pay the full balance on the due date. Like gj83 said - gotta stretch the low 3. whatever Fidelity MM is now paying. If I want to manipulate my FICO, I just shift the spending to my business card.

The only time I have paid before the due date is when I have come up against my credit limit. And yes, I do max out my card sometimes but always pay the balance in full when the statement comes out. I try to maximize my Thank You Points by using my Citibank PremierPass Elite card as much as possible.

John

You don't maximize thank you points by premierpass elite card. Citi amex platinum and MtvU cards maximize them. However, personally I think the two cards will share the same fate as 5% citi cash returns card sooner or later. Good things come and go.

The individual card? No, I hit about 50%, but with the other cards I don't use factored in I never get close to 35% of my total credit limit.

So if I understand you correctly, you keep the money from your credit card(s) in your savings account and then pay it from that savings account a day before the statement closing. How do you manage to do this? I mean how can you withdraw the CC amount into your savings account without incurring any fee(s)?:confused:

You can PM me if you wish. Thanks!

I don't think he's talking about taking cash advances or anything from his credit cards, he's just saying that he tries to keep the money he's about to use to pay off his full statement balance in an interest-earning account for as long as possible before handing it over to the credit card company.

Since we're only talking about an extra 15 days or so of interest here, at 3% per year, this is a pretty minor cash-flow optimization: only 0.1% or so.

I keep the money to pay of my CC in my savings account and pay off the CC the day before payment is due, not the day before the statement closes.

I don't spend money I don't have so the money is in my savings account. I've never taken cash from a CC.

I just don't see much point in paying the bill before it's due, let alone before the statement even closes for it! I'm not getting charged any interest from my CC.

It also helps that most of the stuff charged to my CC is reimbursed business expenses so I'm earning interest on money that was never mine to begin with. I'm not making a killing doing this, but it takes me the same amount of time to pay the bill so whether I do it before the statement closes, before the bill is due, or other random intervals is irrelevant so i'd rather make a couple hundred a year on the side. Any finance charges would quickly eat into that so i always pay in full...just not before I have to.

Paying before statement closing to keep your balance reported to the CRAs at $0 is making a big assumption that they report on the day your statement actually closes.

Right now my report shows my Amex card balances as of two statements ago for my gold charge, Starwood and Blue.

If you are that worried about fluctuations making major changes in your FICO you are probably best opening a couple cards or requesting CLIs to get your utilization down. Unless you are shopping for a mortgage I would not worry about FICO much at all.

As far as I can tell there's nothing on your credit report report that indicates if a balance is new or old. I.e. if you charge $1000 a month on a card and pay it off in full on the due date it will appear the same on your report as having a $1000 balance you're paying interest on. Save yourself the interest.

Frankly I think this idea is put out there by the card companies in order to get suckers to pay interest.

IMHO, it is best to pay off balance every month.

I have been doing this for many years and my credit score is excellent. :)

There actually is something to it to pay your CC balance early.

For example, lets say you have a $10k limit on your card and you make a large purchase - say $6k. If the CC company reports it to the agencies on or about closing date, it will show that you are at 60% credit utilization (you want this number at or below 50% or better 20%). So even if you pay it off on time, it is still a black mark.

Paying it off early means you are billed at 0 with a 0% utilization.

The benefits of paying it off early is offset by interest you may earn on the money sitting in your checking account. Also, it probably makes a difference if your balance is $500 or $3k (on that $10k example).

I personally tend to pay off large balances earlier than the due date - the small routine stuff gets paid on the due date. The corporate card - well, that just slides until the company reimburses me (it doesn't go on my credit score).