How to Use a Credit Card to Increase Your Credit Score

By Trev Gami •  Updated: 01/28/24 •  5 min read

Your credit card directly impacts your score. If used properly, your credit card can significantly improve your credit score, and it can negatively impact the score if not handled well. Therefore, using your credit card responsibly and regularly is one of the fastest and most effective methods to build your credit. This guide provides measures you can take to ensure effective use of a credit card to increase your credit. 

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How to Use a Credit Card to Increase Your Credit Score

Your credit score is used to measure your financial health and how you manage credit. To increase your credit score, you should make on-time credit card bill payments. FICO VintageScoring models used to calculate credit scores prioritize payment history, which contributes 35% of your total score. Therefore, you should not miss or make late payments to enhance your credit score through the use of a credit card.

By paying your credit card bill in full each month, you will not be charged interest, and your payments will be reported to credit bureaus. As a result, your score will increase if you maintain this trend. 

Maintaining a low balance on your credit card is another option you can consider to increase your credit score. The amount you owe contributes 30% to your FICO score, so you must try to keep your balance low. FICO also considers your credit utilization. If you keep your credit utilization low, your credit score will improve over time. You can make two payments per month to keep your credit utilization low instead of waiting for a statement. 

If you have more than two credit card accounts, you should keep them open even when you are no longer using some of them. If you use a credit account for a long period, it will positively contribute to your credit history. Closing a credit card can negatively affect your score. Likewise, you need to choose your credit card accounts carefully, so you can utilize them over a long period. 

Using your credit card responsibly is the key to achieving an increase in your credit score. Having a high credit limit may not be good for your history, especially if you have a habit of overspending. It is important to create a realistic credit card budget to stay on track. 

How Many Points Does a New Credit Card Raise Your Score?

If you have no credit card with no traceable payment history, you don’t have a credit score. Adding a credit card is the first step toward building your credit score, but you may start seeing positive changes after six months of making consistent payments. Adding a second card when you already have less than three credit accounts can increase your score by 7 to 15 points. Opening several credit card accounts may not positively contribute to the growth of your account.  

How Fast Does Credit Card Increase Credit Score?

If you are using a credit card for the first time, you should expect to witness positive growth in your credit score after six months. Make sure you don’t miss any payment every month to increase your credit score. Maintaining a low credit utilization is another measure you can take to improve your credit score. Remember, building a credit score is a process that can take longer than you expect. The good news is that your credit score will gradually improve if you maintain consistent and timely payments of your credit card bills every month. 

How Many Credit Cards Do I Need to Raise My Credit Score?

One well-managed credit card can contribute to an increase in your credit score. Paying your credit on time is key to improving your credit score. In some cases, you may not need multiple credit card accounts to improve your FICO score since your payment history is considered when calculating your credit score. Payment history accounts for 35% of your total score.  

However, having two or three different credit cards can give you an added advantage if you aim to raise your credit score. Our financial situations are different, so having extra credit lines will add to your credit mix. Make sure you consistently use your credit cards to improve your score. Before you apply for several cards, you should know that credit mix accounts only contribute 10% of your FICO score. Therefore, having multiple credit cards might not be a solution to increase your credit score. 

Do I Have to Use My Credit Card Every Month to Build Credit?

Regular use of your credit card and making monthly payments are critical steps you can consider to build your credit. When you make early payments, you will not be charged interest. This will help you maintain a strong credit score. 

One way of increasing your credit score is to use your credit card responsibly. Never miss a payment or make late payments if you want to build a good credit score. Although some people believe that multiple credit cards can contribute to the growth of credit scores, this is not always true. Credit mix contributes only 10% to your total score, whereas payment history provides 35% of the credit score. You can still build a strong credit score with one or two well-managed credit cards.  

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