Today we're talking about 5 UNCOMMON Credit Card Mistakes, what they are, and HOW to AVOID them to maintain and build a GOOD Credit Score

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The Mistakes Are Here Below:
1. Using too much credit utilization or maxing out your card
- As a general rule of thumb, don't keep a balance of more than 30% of your total available credit.
- So let's say you have $10000 in available credit across a few credit cards, you should not carry a total balance of more than $3000 a month (or 30%)

2. Applying for too many in a short period of time
- This is a common mistake that people don't know about, but every time you apply for a credit card, it's known as a hard inquiry on your credit - which means that the creditor (the credit card company) has requested to look at your credit file, which shows up on your credit report.
- According to Experian, read +popup "one additional inquiry will usually decrease your credit score by fewer than five points. However, multiple inquiries in a short period may have a compounding effect."


3. Closing an unsued card with no annual fee
- When you have a credit card open, your total available credit is higher.
- Because your total available credit is higher, that means any balance you do have is now a smaller % of credit that you're using, meaning that your credit utilization is low.

4. Reward Management + Being Efficient
- Alot of these credit cards have great welcome offers, some people CHASE the rewards too hard, or some just don't time their spending correctly.
- First of all, if you don't have 4k to spend in 3 months, or don't regularly spend that much money on a card, DON'T CHASE the rewards simply for doing so. Having a balance just for getting rewards is going to cancel out your rewards.
- Make sure you're being reasonable when applying for one of these, or timing your rewards correctly.
- When I mean timing, I mean like - let's say you know you're about to incur a bigger expense, let's say your car insurance bill is due once a year in February and its going to be $1800 for the year. Well that's when you can apply for a card in mid January or late January, so that when you do get the card, IMMEDIATELY you have $1800 to spend on it so that you can get towards that rewards goal.

5. Paying only the minimum balance due
- If you aren't paying this off, you're just costing yourself money in the long run, and it's going to hamstring you when you're trying to do things like invest for the future.

▶️ My name is Humphrey Yang, I've built multiple businesses and am passionate about Personal Finance. If you're trying to build a solid foundation of financial literacy, learn to invest, or become financially free - then I'm here for you! This channel cover topics like getting out of debt, managing money, building credit, multiple income sources, passive income, etc.

📧 Contact: If you have a question feel free to leave me a comment on my videos or follow me on IG and send me a DM! If you have a business related inquiry, please then send me an email at humphreytalks@gmail.com

Disclaimer: I am not a financial advisor, any investment commentary are my opinions only. Some of the products and services that appear on this channel are from companies that I have an affiliate relationship with, such as Robinhood, for which I recieve a small percentage made via those links, but it doesn’t cost you anything extra!

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