Finally learned my lesson

CliveOfIndia

BethRobinson said:

CliveOfIndia said:

PM22 said:

I thought it would help build my credit if I occasionally spend on them and pay it off same month?

  Just to clarify, for maximum benefit you need to wait until your statement is produced, then pay off the full statement balance.  Don't pay off your spending as soon as you make the transaction.

What difference does this make?

As eskbanker says - and perhaps by way of clarification - it's to do with what's reported to the credit agencies.  If you pay off transactions immediately, it's not bad as such.  But what happens is that when your card company sends in its data to the CRA, the statement shows a zero balance, so it looks like you've not been using the card.  From a credit building point of view, it's better to let them report a balance of £500 or whatever it may be.  This shows that you are borrowing within your means, and always repaying what you owe - which of course, is what any lender likes to see.

On most cards, the payment is due roughly 3 weeks or so after the statement is produced, so there's no rush - wait till you get your statement (either online or through the letter-box), repay the stated full "statement balance", Bob's your uncle.  As I said, ideally set up a Direct Debit for the full balance - though of course, it's down to you to make sure there's enough money in your account to cover it 

That's perhaps a slight over-simplification, but that's the gist of it.