MSE credit score - credit card for more credit use

LibasaurusRex

I've been using MSE Credit Club for years now (great tool) but the one minus I have against my score is credit use, and the recommendation is to buy a few things (weekly groceries) on a credit card and then pay that back in full.

Firstly - is this necessary? Like, will it increase my score by much?

Is there are particular credit card that is best to use for this? I can't work out which category that would fall into under the information on the types of credit card. The credit builder cards seem to be for people with a poor credit score and mine isn't bad at all really.

Not sure if I'm overthinking it!

easyasonetwothree

I would look at getting one with rewards, so you get say 2% back on all your spend. Wait for your statement to come through then pay it off in full. Do remember though that lenders don't see your score, but proof that you're able to manage your credit card will look good.

Phoenix72

Ignore the score, nobody sees it apart from you.

Lenders look at credit history and your record of paying credit on time. Do you have any other sources of credit that are building you a history. If not you may want to consider using the card aa described but ensure you wait till a statement is produced before paying it before the due date.

LibasaurusRex

Phoenix72 said:

Ignore the score, nobody sees it apart from you.

Lenders look at credit history and your record of paying credit on time. Do you have any other sources of credit that are building you a history. If not you may want to consider using the card aa described but ensure you wait till a statement is produced before paying it before the due date.

Other than a mortgage, I have a bank loan (which is due to be paid off next year) and a small loan (finance) on something, but nothing else. Do those count?

I try to save, so generally just pay for things outright as and when needed.

Phoenix72

LibasaurusRex said:

Phoenix72 said:

Ignore the score, nobody sees it apart from you.

Lenders look at credit history and your record of paying credit on time. Do you have any other sources of credit that are building you a history. If not you may want to consider using the card aa described but ensure you wait till a statement is produced before paying it before the due date.

Other than a mortgage, I have a bank loan (which is due to be paid off next year) and a small loan (finance) on something, but nothing else. Do those count?

I try to save, so generally just pay for things outright as and when needed.

Yes, they would contribute towards a credit history but once they are paid off you will be a little 'light' in terms of credit.

LibasaurusRex

Ok, thank you. I don't think I will bother with a credit card and assess it again once my other obligations are paid for.

Appreciated.

CliveOfIndia

Your score is irrelevant, as it's not used - nor even seen - by any lender.

What a lender is interested in is credit history - evidence that you can manage credit responsibly, borrow within your means and always repay what you owe.

Responsible use of a credit card is the simplest way to achieve this at zero cost.  Use if for planned, budgeted spending (food, petrol, whatever), when the statement arrives repay the full balance before the Payment Due date.  This will cost you nothing in terms of fees or interest, and will gradually build up a series of nice green ticks on your credit file.  If you are able to earn some rewards in the process (cashback, airmiles, points of some description) then that's a bonus for you.

Things like a mortgage or loan - a well-managed line of credit of any form - will also help.  It's just that a credit card is, for most people, the simplest way of building/increasing a good history.