• We’re currently investigating an issue related to the forum theme and styling that is impacting page layout and visual formatting. The problem has been identified, and we are actively working on a resolution. There is no impact to user data or functionality, this is strictly a front-end display issue. We’ll post an update once the fix has been deployed. Thanks for your patience while we get this sorted.

Credit Card Question

James Bond

James Bond

Diamond Member
I use my Credit Card to pay for nearly everything day-to-day (food, clothes, etc).

At the end of the day, or end of the week if I'm lazy, I jump online and pay the entire thing off through my checking account where I store most of my money.

Am I gaining credit by doing this?
 
You don't "gain" credit. Creditors view your credit profile, which includes a basic history of your credit-based accounts, sort of like your resume of credit - and decide whether or not to extend you a line of credit.

THey get a credit "score" which is a number based on a bajillion factors that do not make sense to humans as part of it.

By paying your bill and not carrying a balance - you are building your credit history by not having late payments or charge-offs appear instead of "pays as agreed". This - in and of itself is the way to get more and more credit - which may not always be the best thing.

The largest effect on your credit score is the length of time that the accounts have been open, followed by the amount of derogatory accounts shown.

As creditors see your current balance - if you carry one - less is better, but 0 is not the best. Creditors want to see you actually use the credit they extend, so the scoring model puts the largest positive impact that "balance" has - on an account with 5-10% of the maximum balance used.
 
And you hopefully have a card with no annual fee and some type of rewards system so the credit card company will pay you for the free monthly loans they are giving you.
 
Originally posted by: Chryso
Why do you pay it so often?
Click to expand...

Why wouldn't you? It's something you owe and if you can pay it quickly then the better it is. You wouldn't have to worry about it later.
 
"Why wouldn't you?"

To manipulate your credit score - 5-10% balance will get you another point or 2 - granted it'll cost you in the interest...
 
Originally posted by: zoiks
Originally posted by: Chryso
Why do you pay it so often?
Click to expand...

Why wouldn't you? It's something you owe and if you can pay it quickly then the better it is. You wouldn't have to worry about it later.
Click to expand...

I pay mine off once a month. I don't pay any interest charges so I don't see any advantage to paying it more often.
 
Originally posted by: bobdole369
"Why wouldn't you?"

To manipulate your credit score - 5-10% balance will get you another point or 2 - granted it'll cost you in the interest...
Click to expand...

You aren't charged interest as long as it's paid off at the end of the billing cycle.
 
Well, if you pay before the payment is due, you lose the immediate cash on hand that you could be gaining interest with. You don't really gain much unless you happen to be buying a car/house and are somehow able to time your debt/credit ratio enough to actually affect your credit score right when you need it. If you're not planning on taking out any loans, you're not gaining anything by paying early other than clearing cap space if you're near your limit. I'm not even sure you're gaining any peace of mind either since now, instead of paying everything off at the designated due date, you're clearing your balance at random intervals which could get confusing rather quickly!
 
Originally posted by: James Bond
Originally posted by: jiggahertz
Every day? Anal much?
Click to expand...

No, I just like knowing exactly how much money I have.
Click to expand...

You won't, even paying it every day, unless you are keeping a register also. Businesses do not always charge the card the same day, or even week.
 
Originally posted by: zoiks
Originally posted by: Chryso
Why do you pay it so often?
Click to expand...

Why wouldn't you? It's something you owe and if you can pay it quickly then the better it is. You wouldn't have to worry about it later.
Click to expand...

I just don't spend money I don't have, so it isn't a big deal paying my CC bill after the statement comes and before the due date.
 
I prefer using my debit card daily. I only use my CC for large purchases and holiday spending. My credit is great so I don't go out of my way just to use my CC.
 
Originally posted by: SirChadwick
I prefer using my debit card daily. I only use my CC for large purchases and holiday spending. My credit is great so I don't go out of my way just to use my CC.
Click to expand...

I never use my debit card. Far less legal protections when using a debit card. Also, if something goes wrong with the bill or the product I bought, the CC company is more likely to care, as I still have control of the money, unlike with a debit card where it is taken out almost immediately. Plus, the rewards are better.
 
Originally posted by: torpid
Originally posted by: James Bond
Originally posted by: jiggahertz
Every day? Anal much?
Click to expand...

No, I just like knowing exactly how much money I have.
Click to expand...

You won't, even paying it every day, unless you are keeping a register also. Businesses do not always charge the card the same day, or even week.
Click to expand...

I realize that. I just don't like having it hanging over my head.
 
Not to be alarmist, but the current thinking is that some credit card issuers get nervous when they see someone making multiple payments in a cycle and it may explain why some people got their cards cancelled. There can't be any real proof one way or the other since no bank is going to come out and say they cancelled your card because they didn't like seeing multiple payments. They'll use some other reason.

The theory is that multiple payments can indicate someone who can't manage their money well. Whether it's true or not, who knows.

But in any event, it's always good to have more than one credit card available, especially these days.
 
I just use a debit card for things that I'll use right away and won't need to return like food. Citizens Bank has a rewards program that gives you 10 cents for every purchase you make with their debit card up to $120 a year. I think that's easier than paying a credit card bill every day.

I use a credit for online shopping in case I need to dispute something, for electronics to get the warranty period doubled through the card, or for things I may change my mind about later.

As long as you use the card at all and make payments, it will help your credit history.
 
Originally posted by: kranky
Not to be alarmist, but the current thinking is that some credit card issuers get nervous when they see someone making multiple payments in a cycle and it may explain why some people got their cards cancelled. There can't be any real proof one way or the other since no bank is going to come out and say they cancelled your card because they didn't like seeing multiple payments. They'll use some other reason.

The theory is that multiple payments can indicate someone who can't manage their money well. Whether it's true or not, who knows.

But in any event, it's always good to have more than one credit card available, especially these days.
Click to expand...

Good to know. I'll definitely keep that in mind.
 
You must log in or register to reply here.

TRENDING THREADS

Back
Top