I have added my latest and last credit card this year. According to the handy credit simulator at Credit Karma this new card should increase my credit score by 3 points, from 735 to 738. According to another credit simulator this new card will lower my credit score by 3 points to 732. What I take away from this is that this should be my last new card for a while.
I’ve learned that stopping getting new cards and letting them grow is called “gardening”… FICOforums Guarden Club. I intend to start “gardening” for at least a year and let my “average age of open cards” grow.
It take a surprisingly long time of 4-6 weeks for a new cards to show up on ones credit report. So I’ve have to wait to see which credit simulator is more correct. The question… will my credit score go up, down, or stay the same when my newest card is reported? Let’s see how I’m doing in terms of goals:
Credit Score and Credit Card Goals and Results
- ✓ Get 3 new cards without hurting my score much. (Score is down only 6 points)
- ✓ Get new cards with complementary and useful features.
- Slate (Chase): 15-months zero interest, zero cost to transfer balances (during intro period). [No annual fee]
- Quicksilver (Capital One): 1.5% Cash-back on any and all purchases. $100 “signing” bonus. [No annual fee]
- Chase Freedom (Chase): 5% Cash-back on rotating categories. $200 “signing” bonus. [No annual fee]
- ✓ Secure total limits greater than $50K. Current limits total $61,700.
Close to Reaching:
- Part I of Utilization (ratio of debt to total credit limit). Get below 20%.
- Currently at 20%, but not below
- Since newest card has not been included in credit report, TransUnion still thinks my utilization is at 24%
- Part I of “Delinquency”/Payment History: Go from 2 “30-days late” entries down to 1.
- Currently at 98% payments on time
- 2 months until oldest delinquency expires
- On-time payments will increase to 99%
Will likely take over 6-months to achieve:
- Part II of Utilization. Get below 10%.
- My Slate card has about $12K of debt, but the APR is 0% until September 2015. I will likely make minimum payments until August when I will pay in full.
- Part II of “Deliquency”/Payment History: Have zero late entries.
- Will take time. Last negative entry should expire in April.
- Part I: High Credit Scores: Earn a score of 769 or higher.
- I’m at 735
- One estimator says, if I follow my plan, I will hit 745 in about one month… still a ways to go
Will likely take a year or more to achieve:
- Part II: High Credit Scores: Earn a score of 785+
- Beat my wife’s credit score (currently 783, but will probably go up!)
- Secure total limits greater than $100,000
- Preferably by requesting/earning higher limits on existing cards
The first credit goals, which I’ve achieved, show that my initial credit plan was achievable given my starting circumstances of good credit. The second and third groups of credit goals are reasonable goals for attaining excellent credit. Finally, the last group of credit goals constitute vanity goals.
The vanity credit goals are will have virtually no practical use since any credit score above 769 is unlikely to make any difference in getting the best rates, best cards, best mortgages, etc. The only practical consideration is that a 785+ score may provide a small margin of safety against falling below 769 — however that margin would likely evaporate for even one 30+ day late payment. So, really, the vanity goals are there just for fun. And I maintain that having fun is a perfectly good goal!