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Using credit card to improve credit score

I've recently paid off my Tesco Credit Card and I now want to use it for everyday spending, whilst paying off in full each month, in order to improve my credit score. I heard Martin Lewis say this before, so I assume I'm correct in saying that?

My question is, if I use it for say weekly shopping and petrol, am I better off paying it off in full as and when I spend, or wait for my monthly statement and then pay it off in full before the due date?

As I don't really understand how using your credit card in this way improves your credit score, I don't understand which way of paying it off is best (for credit score purposes), if there is any different at all? So I guess that's my second question...how does using your credit card in this way work well towards improving your credit score?

Any guidance would be much appreciated
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Comments

  • [Deleted User]
    [Deleted User] Posts: 35,242 Forumite
    Part of the Furniture 10,000 Posts Photogenic Name Dropper
    Wait for the statement then clear in full.

    It's not your credit score you're trying to change. That's like trying to change the colour of unicorn poo. Even if you could, no one would ever see it.

    What you're doing is building a responsible credit history that will make you look like a safe bet.
  • Apologies, I didn't work that correctly. Indeed I am trying to build a responsible credit history.

    But having said that, I also recall Martin Lewis saying credit card companies don't like people who do the balance transfer 0% interest thing all the time. Isn't that contradictory, if not just confusing??
  • [Deleted User]
    [Deleted User] Posts: 35,242 Forumite
    Part of the Furniture 10,000 Posts Photogenic Name Dropper
    That's not really been proven. I've had cards for over 20 years and not paid a fee or a penny of interest and still get the cards I want.

    Long term BTs without any further spending MAY cause a problem, but there's no evidence of it.

    Bottom line is, you don't need to pay to build a good credit history.
  • Great! Then I shall continue as planned.

    My only other question is, after paying off my credit card last month, I received £5 interest in my latest statement, due in a week or so. I have since used my card the way I planned (shopping). So, with regards to this month only (because of the interest from my previous balance before clearing it), would I still just pay off the statement balance (interest only) and await for next statement to pay off the other amount (shopping)?

    I hope that makes some kind of sense?!?
  • [Deleted User]
    [Deleted User] Posts: 35,242 Forumite
    Part of the Furniture 10,000 Posts Photogenic Name Dropper
    Yes. Once you have paid this statement in full, the trailing interest will stop and you can clear in full each month with no more interest.
  • If there was any shopping on the balance with the interest pay it all off, ie the full statement balance. If the statement due is only the interest then that is all you need to pay.
  • Is there an amount of money I should aim to spend over each month, in order to build this responsible credit history??
  • Just to add my 10 pence worth. Using your card and paying it in full helps build your credit. In just over a year ive got from a £250 credit limit to over 3K, i never go past a few hundred and just last month i applied for a Tesco Credit Card and got accepted immediately.

    I still have 4 defaults which are aged but had zero credit history now its much better!
  • A4445
    A4445 Posts: 1,103 Forumite
    Just to add my 10 pence worth. Using your card and paying it in full helps build your credit. In just over a year ive got from a £250 credit limit to over 3K, i never go past a few hundred and just last month i applied for a Tesco Credit Card and got accepted immediately.

    I still have 4 defaults which are aged but had zero credit history now its much better!

    If you don't mind me asking what card is that?
  • Just to add my 10 pence worth. Using your card and paying it in full helps build your credit. In just over a year ive got from a £250 credit limit to over 3K, i never go past a few hundred and just last month i applied for a Tesco Credit Card and got accepted immediately.

    I still have 4 defaults which are aged but had zero credit history now its much better!

    That's fab! Well done.

    When you say you "never go past a few hundred", do you mean you never spend more than a few hundred a month on your card before paying off in full?

    That is the only thing I'm unclear on. If spending between £70-£100 per week (on grocery shopping), before clearing balance off in full is enough? Or is it the more you spend and repay in full, the better?
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