How to Pay Your Credit Card Bills Strategically to BOOST Your Credit Score!

Hey, credit heroes. A couple weeks ago I due edit a TikTok video with tips about exactly when to pay your credit card to boost your credit. And a ton of people watched it and they had a lot of questions. So that's why today I'm going to cover everything you need to know to boost your credit scores by paying your credit card bills strategically. So you better stick around. My name is Daniel Rosen, and welcome to Credit Repair Business Secrets. Years ago, when I was in show business, I would have such long gaps between gigs that I basically lived on my credit cards. And my credit cards were always maxed out. And if I did have any available funds on one card, I would get a cash advance on it to pay towards my other cards. And by doing that, I got deeper and deeper in debt. And at one point I was over $200,000 in debt. And when I did have a gig, and even if it was a big gig, all that money would go to pay just the minimum payments and there was never anything left and there was no way for me to get ahead. And my credit score really suffered because back then I didn't know any better. So I was caught in their trap. But now, after learning so much about credit and helping so many thousands of people to improve their credit, I see all the ways that I screwed up. And my biggest mistake back then was was not understanding exactly how credit cards work. And now I know how to game the system to boost your score even if you have credit card debt. And that's exactly what I want to share with you today. So let's start with the basics. Your credit card bill or your credit card statement is a snapshot of your credit usage. It shows your transactions balance and the due date. And paying your credit card bill on time is very, very important for avoiding late fees, saving money on interest, and maintaining a good credit standing. But did you know that the actual timing of your payments can also greatly impact your credit score? Well, that's right, it can. When you pay your credit card bills strategically, you improve your payment history and your credit utilization ratio, which together make up two thirds of your credit score. That means how you handle paying your credit card bills impacts your score more than any other factors. And today I'm going to break down exactly how to do it to get the maximum score. For those of you new to the world of credit repair, there are five main factors that determine a credit score. 35% is payment history, whether you pay on time, late, or miss payments. 30% is credit utilization. This is the ratio of how much credit you have available and how much you are using. For example, if you have a credit card with a $10,000 limit and you're carrying a balance of $9,000, that means your credit utilization ratio is 90%, which is very, very high and can hurt your score. 15% is credit history, 10% is credit mix, and the last 10% is determined by recently opened new credit accounts. This means that over half of your credit score is determined by your payment history and your credit utilization alone. So the biggest improvement you can make is by strategizing exactly when to pay, how much to pay, and and to never miss a payment. When and how much you pay will vary depending on your situation. But what's not negotiable is missing payments. You must never, ever miss a payment. Overall, the only bad time to pay off your credit card balance is after the payment is due. This can bring a lot of negative effects. Your credit score can drop, but you'll also have to pay late fees and interest. And paying more than you have to is not a good idea either. But if you're paying your balances in full every single month before you get your credit card bill, then the credit bureaus might not see that you're actually using this credit, which really doesn't do much for your credit score. So when exactly should you pay your credit card bill? There are two important dates on every credit card statement. The statement date and the due date. They may sound similar, but there's some very big differences that you need to be aware of. The statement date is the last day of your billing cycle when your statement balance is calculated and your credit card statement is generated. It usually occurs around 21 to 25 days before your payment due date. This is also the day when your credit card balance is reported to the credit bureaus. The payment due date is the last day you can pay your credit card bill without incurring a late fee. You need to pay at least the minimum amount due by this date to avoid late fees. Let me give you an example so you have a better understanding of how this all works. You have that one credit card with a $10,000 limit, and during one month you go on a trip and you spend $9,000. Now, if you wait until your credit card bill comes in the mail, your credit utilization rate of 90% will already be reported to the credit bureaus. The higher your credit utilization is, the higher the risk you appear to be to lenders. And this is going to have a negative effect on your credit score. Financial experts will tell you that the ideal ratio for credit utilization is roughly 30% or less across all your credit accounts. Still, using this same example, imagine instead that you made an early payment towards your $9,000 credit card balance so that by the time you get your credit card statement, you only have a $3,000 balance. Once this information gets reported to the credit bureaus, it'll show that you're using the card building positive credit history and you have a 30% credit utilization rate. This means that lenders will see your behavior as you're using the card responsibly, and it will really improve your credit score. But you still need to make sure that you always pay your balance in full by the payment date so that you don't get hit with potential late fees or worse. Now let's talk about another strategy for paying off your credit card, which is auto payment. Each person has a different billing cycle, so every situation will vary. But if you take a simple approach, rather than calculating your credit utilization and making your payments early, this is what I recommend. Every single credit card company has an auto payment feature. They usually have two make the minimum payment every time your balance is due or pay your balance in full whenever a new balance is due. My suggestion is to always have auto pay set four to five days before your balance is due and have it set to auto pay for the new balance. This way you'll never miss a late payment, which will save you from late fees. And you'll also not just be making the minimum payment, so you're saving money by avoiding the interest. But here's an important note. If you do decide to have your balance paid in full every single month with auto payments, do not make any extra payments. If you do, you may be overpaying and you'll have a negative balance on your credit card, which means that the credit card company has this cash of yours sitting there until you spend it or ask for a check. And if you want six months of credit repair cloud software for free and access to our advanced disputing and business courses, go to creditrepaircloud.com freetraining and sign up for our masterclass. And here's my final point. You're not just paying bills, you are managing your credit. And these strategic small steps lead to a boosted credit score and a better financial future. So mark your calendars and set your bill payment schedule. And I'll end by saying if you want to learn more strategies for building credit, check out my episode the Ultimate Guide to Credit Builder Loans. And if you'd like to get certified in disputing and gain confidence and grow your very own credit repair business. Check out our Credit Hero Challenge. Doors are closing soon, so sign up right now@creditherochallenge.com and keep changing lives.