This is How to Maximize Your Credit Score with Your Balance


So you have no negative records, no late payments, have a couple credit accounts open for a long time, and haven’t had your credit checked in a while. The only thing affecting your score now is your credit card balance. How does your balance affects your score?

I was using Credit Karma’s credit score simulator to see how exactly my balance affected my score and I found something very interesting. There seems to be a couple of sweet spots that will help boost your score more than others.

Now there are plenty of articles out there that say as long as you stay under 30%, or under 20%, or under 10% of your credit card balance, your score won’t be affected. Well according to Credit Karma, who uses the Vantage Score, that isn’t the case.

These 3 Ranges are the Sweet Spots in Balance vs Credit Score

It’s pretty easy to test it out. Just enter some values in to the simulator, and see how your score is affected. What I found during my testing is the following (FYI when starting the simulator, my balance was 24%):

  • Balance between 0% and .5450%, my score will go up 51 points.
    • I thought this was the strangest, because I always heard that if you keep a 0 balance, it won’t help
  • Balance between .5477% and .6228%, my score will go up 50 points
    • Just a 1 point swing, not bad
  • Balance between 3.4255% and 3.6940%, my score will go up 49 points
    • Balances between .6228% and 3.4255% range from 48 point difference all the way down to 40 point difference.

Those values are the sweet spots, for me. Your results may vary.

What Credit Card Balances Hurt my Score?

So let’s test some others quick, just to see what the affect is. Does keeping a 30% balance work to your advantage?

  • 2.5% Balance raises my score 41 points.
  • 5.0% Balance raises my score 44 points.
  • 7.5% Balance raises my score 38 points.
  • 10.0% Balance raises my score 33 points.
  • 12.5% Balance raises my score 28 points.
  • 15.0% Balance raises my score 13 points.
  • 17.5% Balance raises my score 9 points.
  • 20.0% Balance raises my score 5 points.
  • 22.5% Balance raises my score 2 points.
  • 25.0% Balance lowers my score 2 points.
  • 27.5% Balance lowers my score 5 points.
  • 30.0% Balance lowers my score 23 points.

Oofda! 30% credit card balance is definitely not something you want! That’s a 70 point swing from the best sweet spot!

So What Credit Balance Should I Have?

It would appear, assuming CK is using the right calculations for their simulator, that if you try and keep a balance of 5% or below, your score will stay within 10 points of where it is now. If you want to maximize your score, keep a VERY small balance.

Remember that this balance is sent to the credit companies when your statement is released. So if you can, make your payment on your statement 1 or 2 days prior to the new statement coming out.

Pay off the statement balance each month to avoid interest. That doesn’t mean you have to have a 0 actual balance. Keep up to .62% balance on the card for the statement to get the best credit score!

This is just one of many factors for determining your credit score. Like I said in the beginning, this is just how your credit card balance affects your score. It just happens that the balance is one of the big factors (on Vantage this is “Utilization”, 23% – on FICO it’s “Outstanding Debt”, 30%).

Vantage Score Factors vs FICO Score Factors

Disclaimer: I do not work for nor am I associated with Credit Karma. I am also not receiving any compensation for this article. Just thought it was interesting and figured I’d share!

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