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Hello to all and thanks for this great site and all the useful information. I have a question and was hoping to get some advice from the many regulars on this site.
I am 32 years old and have no debt beyond my mortgage. I have worked hard to become "debt free" and just recently joined the club. However my problem is while getting to this debt free stage, I restricted my credit card use. To pay off my cards, I used the snowball and took them out one by one. This however put me in the position where I would have cc's with $0 balance sitting for extended periods of time.
At one point in time, I had a total credit limit from my cards in the range of $40k. But as a result of my non-activity that $40k has been slashed to just under $20k and with it my credit score has taken a significant hit as well. So I am in the situation where I have paid off my debts but my credit score went down over time as a result!
So my question now is what is the best way to maintain a healthy credit limit while not using my credit cards? From past experience I would think that even if I were to charge 20% on my cards and then pay that off each month, they would just reduce my limits to what's regularly being charged on the cards?
Am I misunderstanding or approaching this the wrong way?
Thanks for any feedback and again, I love the site!
I am 32 years old and have no debt beyond my mortgage. I have worked hard to become "debt free" and just recently joined the club. However my problem is while getting to this debt free stage, I restricted my credit card use. To pay off my cards, I used the snowball and took them out one by one. This however put me in the position where I would have cc's with $0 balance sitting for extended periods of time.
At one point in time, I had a total credit limit from my cards in the range of $40k. But as a result of my non-activity that $40k has been slashed to just under $20k and with it my credit score has taken a significant hit as well. So I am in the situation where I have paid off my debts but my credit score went down over time as a result!
So my question now is what is the best way to maintain a healthy credit limit while not using my credit cards? From past experience I would think that even if I were to charge 20% on my cards and then pay that off each month, they would just reduce my limits to what's regularly being charged on the cards?
Am I misunderstanding or approaching this the wrong way?
Thanks for any feedback and again, I love the site!