How to use a credit card to get a good score in the USA?

Understand how to use a credit card and increase your score

f you are living in the United States, whether as an immigrant, student, or even an American citizen, one of the first things you’ll hear about is the credit score. This number, which usually ranges from 300 to 850, represents your financial reputation. It is essential for getting loans, renting properties, signing up for phone plans, buying a car, or even landing certain jobs.

One of the most effective ways to build and improve your credit score is by using a credit card strategically. But beware, using it without planning can have the opposite effect. In this article, you’ll learn how to use your credit card to your advantage and increase your chances of achieving an excellent credit score in the USA.

What is a Credit Score?

The credit score is a number calculated by companies like FICO (Fair Isaac Corporation) and VantageScore. It considers several factors, such as:

• Payment history (35%)
• Credit utilization (30%)
• Length of credit history (15%)
• New credit (10%)
• Credit mix (10%)

So, it’s not enough to just pay your bills on time. You need to have a healthy and consistent financial behavior over time. That’s where the credit card becomes a tool to show your responsibility.

How to Use a Credit Card to Build a Good Score?

Now, it’s time to learn more about how to use your credit card to have a good track record in the financial market. To help you with the process, we’ve put together a list of important tips. Check it out below!

1. Always Pay on Time

The most important tip of all: always pay your credit card bill on time. Even if you only pay the minimum required amount, it still counts as an on-time payment.

However, the ideal is to pay the full amount whenever possible, to avoid interest and show that you are in control of your finances.

Frequent delays harm your score significantly, as payment history makes up the largest portion of your score.

2. Use the Card in Moderation

Another key factor is how much of your limit you use. This is called credit utilization, and the lower it is, the better. The recommendation is to use no more than 30% of your card limit, and ideally keep usage below 10%.

For example, if your card has a $1,000 limit, try to use no more than $300 per month. Using the full limit or exceeding it can indicate that you rely too much on credit, which worries lenders and can lower your score.

3. Keep the Card Open, Even If You Don’t Use It Much

Many people think that if they haven’t used a card in a while, the best option is to close it. But closing an old card can shorten your average credit history, which negatively impacts your score.

Even if you don’t use it often, it’s worth keeping the card active and making small monthly purchases to keep your history alive and healthy.

4. Request a Credit Limit Increase Responsibly

Over time, issuers often offer credit limit increases. This can be beneficial to your score because it increases your total credit and lowers your usage percentage.

For example: if you spend $300 per month and your limit increases from $1,000 to $2,000, your utilization drops from 30% to 15%. That helps raise your score.

5. Avoid Applying for Too Many Cards in a Short Time

Every time you apply for a new card, a credit inquiry (called a “hard inquiry”) is made.

This can temporarily lower your score. If you apply for multiple cards in a short period, lenders may think you’re desperate for credit, which reduces your trustworthiness.

6. Start with a Secured Card, If Needed

If you don’t yet have a credit history in the USA, banks often offer what are called secured credit cards. These work like regular credit cards, but require a security deposit (usually between $200 and $500), which serves as your credit limit.

With the correct use of this type of card, you can begin to build your credit. In a few months, you may become eligible for better cards with no deposit required.

Conclusion

Having a good credit score in the USA is not something that happens overnight, but rather with discipline, organization, and financial intelligence.

When used wisely, the credit card is a powerful tool to show the market that you are reliable and responsible.

Start with simple steps: pay on time, keep your usage low, and monitor your progress. Over time, you’ll not only have access to better rates and conditions, but also open doors to new opportunities in the country.

Written by

Juliana Raquel