Скачать или смотреть CREDIT CARDS 101: Should You Carry a Balance On Credit Card?

Carry a balance or pay in full every month? It’s a question asked all the time! Click "Show More" to see Ad Disclosure.

Or asked a different way: “Should I carry a credit card balance to increase my credit score?” For those of you looking for a straight answer, here it is: NO. This video will explain why ;-)

💳👉VIEW CREDIT CARD OFFERS!
https://markscreditcards.com/offers

🛍 RAKUTEN - Earn Cash Back!
http://markscreditcards.com/rakuten

‼️ GET FREE STOCKS FROM WEBULL when you open an account & deposit $100:
http://markscreditcards.com/webull

QUESTION 1: Should you carry a credit card balance to increase your credit score?
ANSWER: NO. Let’s see why…

Carrying a small balance month to month is based on a misunderstanding.

It’s GOOD to have at least a small balance be reported each month. Reported means your balance is sent to the credit reporting bureaus (Experian, TransUnion, Equifax) to calculate your credit score.

It’s BAD to carry that balance from one month to the next.

LET ME EXPLAIN FURTHER…

GOOD: Letting a balance report to the bureaus can demonstrate:
a. Use of your card
b. Good payment history when you pay your bill on time
c. Responsible management of your card by not using a high % of your limit

BAD: Carrying a balance month to month will charge you interest, meaning…
a. Your balance will increase every month
b. You’ll owe more to the bank when you pay it off
c. You’re more likely to fall into debt

WHAT TO DO INSTEAD: 4 STEPS

1. Use your credit card to pay for the things you would normally buy with cash (food, utilities, gas, etc.)

2. Let your balance get reported to the bureaus. This usually occurs 1x per month (not daily) on your close date. (Exception: U.S. Bank reports your balance on the last (business) day of the month).

3. Get your bill (also called a statement) and look at the due date.

4. Pay off your full credit card balance on or before the due date.

FOLLOWING THOSE 4 STEPS WILL…

Build payment history | 35% of your credit score

Show management of your utilization | 30% of your credit score

Increase credit age when done over time | 15% of your credit score

Avoid all interest charges

Keep you out of credit card debt

QUESTION 2: Should you carry a credit card balance for any reason…ever?
ANSWER: NO, with 1 exception…

THE 1 EXCEPTION…

If you have an emergency or big / unexpected expense…can’t pay for it now…but will be able to a few months later…consider getting a credit card with 0% APR on new purchases for 12+ months.

That will allow you to carry a balance from month to month without paying any interest. That said, be sure to pay off the entire balance before the promotional APR rate expires so that you don’t pay massive interest charges at the end.

GREAT CREDIT CARDS FOR BEGINNERS - No Credit Score
Discover it Secured Credit Card
Secured Mastercard from Capital One
Citi Secured Mastercard
Petal Credit Card (Petal 1 Credit Card | Petal 2 Credit Card)

GREAT CREDIT CARDS FOR BEGINNERS - Already Have 6-12 Months of Credit History
Amex Platinum Card
Amex Gold Card
Amex Green Card
Chase Freedom Flex
Chase Freedom Unlimited
Chase Sapphire Preferred
Chase Sapphire Reserve
Bank of America Cash Rewards Card
Citi Double Cash
Amex EveryDay Card
Amex Blue Cash Everyday Card
Amex Blue Cash Preferred Card
Discover it Cash Back Credit Card
US Bank Altitude Go Card
US Bank Cash+ Card
Capital One Quicksilver Card
Capital One Venture Card

Disclosure: This site is part of an affiliate sales network and receives compensation for sending traffic to partner sites, such as CreditCards.com. This compensation may impact how and where links appear on this site. This site does not include all financial companies or all available financial offers. The content in this video is accurate as of the posting date. Some of the offers mentioned may no longer be available. Mark Reese is not a financial advisor.

#creditcards #creditcardsforbeginners #creditcards101