Nail Your Credit Utilization Ratio - Day 18 - 30 Day Challenge to Master Your Credit

Did you know that 93% of all new year resolutions fail? The reason isn’t one of willpower or motivation. The 3 biggest reasons are:
1.No structured step-wise plans
2. No clear intermediate milestones and
3. No access to good resources.
So this year, we’ve decided to fix these 3 problems to solve the number 1 new year resolution in India, to become financially independent.
Welcome to mymoneykarma’s Master Your Finances resolution, a series of 30-day challenges that are structured to guide you through the simple 5-minute tasks you need to tick off each day to successfully master your finances.
So kick off your new year with a resolution we guarantee you can keep: the mymoneykarma 30 Day Challenge. In January, we help you Master Your Credit. Each day we’ll explain a task you can finish in less than 5 minutes. At the end of 30 days, you are guaranteed to have mastered your credit.

What is mymoneykarma?

This channel is dedicated to simplifying the concepts and best practices of Personal Finance through explainers, FAQs, tips, and educational material. We empower viewers to each become a paragon of Intelligent Finance.

Founded by a group of Stanford alumni with a strong background in banking and technology, MyMoneyKarma has been revolutionizing the Indian Fintech sector and ushering in the future of personal finance. Committed to a social mission of creating a measurable impact on people’s lives, MyMoneyKarma has empowered millions of people to reclaim control over their finances by addressing the 3 biggest issues and barriers in the sector:

Low financial literacy means most people applying for loans, mortgages or credit cards have never checked, nor heard of, their credit scores. By this time, the damage has often been done
Low information transparency means it can be difficult to know the best interest rates for each customer’s unique profile, the financial providers that offer the best terms, and how to maximize one’s chances of being approved (where a rejection further worsens the credit score)
High effort and hassle means one is too hard-pressed to shop around, try multiple options and find the best fit, instead ending up with sub-optimal decisions and a whole lot of wasted time and sweat

MyMoneyKarma’s fully online loan optimization technology helps customers with an extensive range of financial products, delivering the lowest interest rates and comprehensive service at the touch of a button.

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Transcript:
Yesterday we introduced the concept of the credit utilization ratio and explained how you can use a rebalancing among your various credit cards to optimize this number and increase your credit score. But what if you have just one credit card? Today’s task will help you with this. Credit bureaus only take this ratio into account once every 30 days at the end of your billing cycle. What does this mean? If you make two payments in a month towards your credit card outstanding balance, then you can spend much more than 30% of your credit limit and still show a very low credit utilization ratio by timing your payments. Let’s do that today. Is your credit utilization today greater than 30%? Ignore your billing cycle and calculate the payment you need to make in order to bring your credit utilization ratio under 30%. Make that payment now. Tomorrow we’ll take this one step further by addressing the credit limit itself, on Day 19 of mymoneykarma’s 30 day challenge to master your credit.