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4 min read

The 30% rule: credit utilization explained.

Why the amount you owe versus your limits is one of the fastest levers you have.

Credit utilization—how much of your available credit you are using—is one of the biggest factors in your score, and one of the few you can change quickly.

Aim under 30%, ideally under 10%

If you have $10,000 in total limits, try to keep total balances under $3,000, and under $1,000 for the strongest effect. This applies both per-card and across all your cards.

Pay before the statement closes

Scores use the balance reported on your statement date, not necessarily what you owe after you pay. Paying down before the statement closes lowers the number that gets reported.

A higher limit helps too

A credit-limit increase (without a hard pull) instantly lowers your utilization, even if your spending stays the same. Try the Utilization Calculator in our Credit Academy to see your numbers.

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