How To Raise Your Credit Score With Credit Card Use

I’ve gone through the process of improving my credit score and I’ve also helped my husband and several friends do the same. Working on your credit to reach an 800 credit score can be both frustrating and very rewarding.

Figuring out what works to raise your credit score takes a bit of effort, reliable resources, and time. The things you need to do to increase your credit score to 800 are well documented and anyone can do it. In this video and blog post I’ll share what I’ve learned about raising my credit score to 800 and how I used credit cards to do it.

Learn About Credit Scores

You are probably starting off with a bad or non-existent credit score so the world of credit seems mysterious and unknown. Luckily while the exact formula is not public information, the general knowledge of how to increase your credit score is well know.

Learning about credit scores and how credit works will help you raise your score on your own or find the right person to help you do it. If you’re new then reading up about how to improve credit is a great place to start. I’ve share multiple posts about credit scores that can help get you start:

There are no real secrets to credit repair and anyone can do it with a bit of self-education. Most of the things that increase your credit score are actually just solid financial principles likes paying down old debts and not spending more on credit than you can afford to pay.

Figure Out Your Why

Credit scores and even the use of credit can be controversial in the personal finance world. Some people are for it, some are against it, and others like me accept it as part of our current system as a tool we can use to better our life.

Credit scores are important to regular people living their lives for a number of reasons from buying a car to purchasing a home to even getting better rates on insurance. There are a number of reasons in life why you might want a good credit score and thinking about your own personal reasons will help you during this process.

For example, knowing you need to increase your credit score to finally purchase a home of your own is much more motivating than just the general idea of having good credit.

In this step you can also decide if you really want to pursue a good credit score or not. Most of the things you can accomplish with good credit can also be done with no credit at all as well. However, you need to pick one route or another because ending up in the middle without a plan leaves people with bad credit that hurts more. You need to think about why you want good credit and then either commit to having the best credit possible or no credit score at all. Either option is valid but you need t commit to what is best for your situation.

Open New Credit Strategically

Opening new credit can boost your credit score if it’s done in the right way. You need to have a strategic plan for opening new credit so that doing so helps you and raises your credit score instead of pushing you in the wrong direction.

Building your credit by opening multiple new lines can actually hurt you if you do it all at once. Instead of running out and opening multiple new credit cards at once, you’ll want to do one now and wait a few months until making your next move.

Opening credit for the first time can be done by getting a commonly offered card or even getting a secured card if you can’t get approved for another. A secured card is where you put down a deposit in order to have a credit line equal to the amount of the deposit. This protects the credit lender and allows you to build a history with credit.

Because you won’t be opening all your new credit lines right away you’ll have to accept a longer term perspective for increasing your credit score to 800. It won’t happen overnight and depending on your starting point it could even take a couple years. This is where having a reason why and having a purpose will keep you on track.

Using Credit Cards Wisely

How much credit you are currently using will affect your credit score. If you are only using a small percentage of the credit you could be using then your score will be higher.

Having a good credit score doesn’t mean you need overwhelming amounts of debt. In fact, having large debt balances usually hurts your credit score because of the credit utilization factor. You never, ever want to max out your credit cards because doing so will hurt you and your credit score.

Your credit utilization is the balance of your debt compared to the available credit you have access to. This contributes 30% to FICO score’s calculation which means it is something you need to work on asap. 

The goal here is to pay off debt while still keeping your credit limits high. This lowers the amount of credit you are using compared to the amount you could actually use. 

Keeping your credit utilization low will involve several things:

  • Paying down existing balances – Keeping your debt levels on credit cards lower will help you keep your credit score high. If you have high existing balances your first move will be to pay those down.
  • Use your cards with bills not spending – Personally I recommend most people don’t use credit cards for day to day spending because it usually gets out of control and leads to debt. The best way to do it is just charge a bill or two to your card so it’s active and being used but not hitting 30% use (I find 10% or less to be effective).
  • Increase credit card limits – Another way to help utilization is to increase the amount of credit you have access to that you are not actually using. A great way to do this is to increase your credit card limit by asking the company to raise it.
  • Pay your bill on time once it’s been reported to the credit bureaus – Every lender reports their existing balances to the credit bureaus at different times. This is a critical thing for you to know because you want to make sure you pay your bill before it’s overdue but after it’s been reported so it will help you credit score. While it’s normally around the statement date, the best way to find this date for each card and lender is to ask them directly.
  • Never max out your cards – This has been mentioned throughout the post but you do not want to max our your cards when trying to increase your credit score. This will just hurt your score.

Apply for New Credit As Needed

Having multiple accounts open for long periods of time can help your credit score but that doesn’t mean more is better.

You don’t need to open 25 different accounts to get a good credit score. In fact I have less than 10 and have an excellent credit score.

Be selective in the credit lines that you open. Don’t max yourself out with too many new open lines of credit. It will drop your credit score temporarily and it could potentially put you in a precarious situation.

If you are in a credit building stage, then you should work on opening new cards strategically over time but never all at once. Wait 6 months or more between opening new credit lines.

Don’t Obsess Over The Score Daily

It might be tempting to pay someone to help improve your credit score quickly, but be cautious of these services. Many are not helpful but take your money for something you can do yourself.

You can improve your credit score over time by following common sense credit guidelines and getting on a budget.

The less you obsess about your credit score the better off you will be.  Ultimately a credit score isn’t the most important thing in your financial life and there are ways to operate around a bad credit score or no credit score at all.

If you are planning to use credit less and don’t need it for a future mortgage or car loan or new job then your credit score will be less important.

Remember that even if you are planning to use credit in the future, you can work with what you already have, pay things on time, use credit responsibly, and build your credit score from there.

Mary is the founder of Pennies Not Perfection where she shares her journey to build wealth through online income. She quit her day job in 2021 after she paid off her debt and doubled her 9-5 salary.

Mary's favorite free financial tool is Personal Capital. She uses their free tools to track net worth and work toward to financial freedom.

Her favorite investment platform is M1 Finance, where she built a custom portfolio for free with no fees. She shares her portfolio growth and savings progress every month on YouTube.