One of the most challenging things anyone can do is develop the discipline to pay off credit card balances every month consistently. It’s not easy, and it takes some time to train yourself to make this a habit that has a lot of benefits, like less debt and a higher credit score.
Key Points
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This Redditor went from having a backlog of credit card debt to a standout credit card score.
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The Redditor paid off the debt by using a balance transfer to a 0% interest card.
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Amazingly, the Redditor fixed his credit score in just six months with strong payment efforts.
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This is exactly what one Redditor is learning right now, according to their post in r/personalfinance on Reddit. For a long while, they admittedly paid interest on maxed-out credit cards, but they now have discovered how to be mindful of their spending, and it’s increased their credit and helped them earn a whole lot of cash-back rewards.
It’s Okay to Learn From Your Mistakes
According to this Redditor, when they were a freshman in college, their parents took out a credit card in their name and maxed them out. Not only is this incredibly unfortunate and awful, but it left the Redditor with approximately $3,000 of credit card debt starting at 18 years old.
You can imagine that this put them on a path to having a negative credit score, and this did happen as they were somewhere around 590 for a long while.
On the plus side, after discovering how to pay off all of their debt all while building an emergency fund, they are now looking at a credit score of 715, which is a strong “good” score according to the credit bureaus. This was a pretty intense mission for the Redditor, as they explain in their post, and that they achieved paying off all of the debt in under half a year is a fantastic success story.
All of this leads directly to a question of how they did this? Even though people have varying degrees of credit card debt, the strategy this Redditor used might be something other people in similar situations want to know.
How to Raise Your Credit Score, the Redditor Way
In a previous post on Reddit, the original poster goes into a little bit of detail as to how they wiped their debt and raised their credit score at the same time.
When they started off, their score was 590 and they had a balance of around $3,500 when they graduated from graduate school and started their first real job. At first, the emphasis was on building up an emergency fund, something that everyone should do first.
Their next step is something everyone should do, and that is to consider moving all of the debt over to a zero percent card that is offering a promotional period between 12 and 21 months. The Redditor did this and chose the Citi Double Cash Back card and was then able to close two of their four credit cards that were on the short end of their average length of credit history.
This carried on, having started in May, and we’re now in July, when they have now just the Citi card, a Discover card, and a Capital One card that doesn’t have any benefits but was already seven years old.
Fast forward to September, and they have refinanced their car from 12% to 5%, and track their budget through a computer program that highlights where they are overspending. This allowed the Redditor to cut some of their spending by as much as 50% and at this point, the credit score is now 705.
Raise Your Own Credit Card Score
In the future, if you find yourself in a similar situation where you have to raise your own credit card score, it’s important to know there are some easy tips to do so.
The most important thing is to make sure you are paying your bills on time. Even if you’re only paying the minimum balance, on-time payments can be critical to raising your credit score.
Of course, paying off your balance in full every month will help the most, as it lowers your credit utilization percentage, which is one of the fastest ways to raise your credit score.
The other powerful piece of advice is to make sure you are checking your credit report, at least once a month, and make sure there isn’t anything on there you don’t recognize or believe is incorrect. It’s shocking how fast an error on your credit report can tank your score and make it difficult to rent an apartment or buy a car, so catching things fast is critical.
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