 TITLE: What Is the Best Credit Utilization Ratio? CONTENT: How Much Credit Should I Use?\n-----------------------------\nIf you're focused on having excellent credit scores, a credit utilization ratio in the single digits is best. So, for example, if your credit limits across all of your credit cards add up to $10,000, keeping your total credit card usage under $1,000 will be best for your scores. If you need to occasionally use more credit to cover your bills or pay for an emergency, however, that's not necessarily bad for your credit in the long run—as long as you pay down the balance as quickly as possible.\nCredit utilization is an important credit scoring factor across all the various credit scoring models, but most credit scores only consider the current balances and credit limits on your credit report—it's a snapshot of where you stand when your score is calculated. (If you're unsure about the math, here's a closer look at how to calculate credit card utilization.)\nHaving a high utilization ratio one month may hurt your score. But once you pay down your balance and your card issuer sends an updated balance to the credit bureaus, your credit utilization goes down as well. As a result, you could quickly see an improvement in your credit scores.\nIt's also important to understand that credit card companies generally report your account balance around the end of your billing period. As a result, you could have a high utilization ratio even if you pay your bill in full, because the bill usually isn't due until around 21 to 25 days after you receive it.\nIf you frequently use your credit card to earn rewards or for the purchase protections it offers, you could pay down your balance during the billing period instead of waiting until just before the due date. Your card company will then report the lower current balance to the credit bureaus, which can lead to a lower utilization ratio and better scores. END