Enrichment · Life Skills

Try a plan before it
reaches your credit report.

List your cards with their limits and balances. Then test the moves people argue about: paying before the statement closes, closing an old card, a higher limit. The calculator shows what each one does to your utilization, overall and card by card.

Try my planWhat you get

The utilization calculator

The worked example is made up: three cards with $2,250 owed on $7,300 of limits, and a plan that pays $810 before the statements close, closes the store card and raises the travel card’s limit. Use the figures on your own statements. Nothing you enter leaves this browser.

Loading the calculator. If nothing appears, turn on JavaScript.

What you get

Enrichment · Life SkillsFree

What you finish with
Your overall credit utilization and each card’s, now and after the plan you try; the amounts owed and limits after it; the payment that would bring you to a target rate; and notes on what the plan changes, such as a closed card taking its limit out of the total or a closed card still carrying a balance. A one-page plan prints and the figures download as a spreadsheet.
Who it is for
Students with a first credit card, young adults building credit, families talking through credit, and teachers of personal finance who want students to test real cases.
Format
Browser tool. Works on a phone, tablet or computer; the numbers move as you type. Up to ten cards. Prints a one-page plan; downloads a spreadsheet (.csv); export and import a file.
Access
Free. No account, no sign-in and nothing to install. Everything you type stays in this browser; nothing is sent to Caveat.
Where it lives
The Life Skills space in Caveat Enrichment.
Support
Questions, a correction or a request: team@caveatacademic.com.

How to use it

  1. Add each credit card with its credit limit and the balance on its latest statement.
  2. Read your overall utilization and each card’s.
  3. Try a plan: an amount to pay before the statement closes, a card to close, a new limit, or a new card.
  4. Compare now and after, and see what it would take to reach your target.
  5. Print the plan or export it, and update it when the next statements arrive.

Try my plan

How utilization is worked out

Balances divided by limits, overall and card by card.

1 Now: all balances over all limitsBalances$2,250$690 + $410 + $1,150Limits$7,300$1,500 + $800 + $5,000Utilization30.8%$2,250 ÷ $7,3002 After the planBalances$1,440$290 + $0 + $1,150Limits$8,000store closed, travel $6,500Utilization18.0%$1,440 ÷ $8,0003 To reach a 10% targetNow, pay down$1,520$2,250 − 10% × $7,300After the plan, pay down$640$1,440 − 10% × $8,0001 NowBalances$2,250three cardsLimits$7,300three cardsUtilization30.8%$2,250 ÷ $7,3002 After the planBalances$1,440after $810 paidLimits$8,000one closed, one raised3 To reach 10%After the plan, pay down$640$1,440 − 10% × $8,000
The worked example: $2,250 owed on $7,300 of limits is 30.8%. Paying $810 before the statements close, closing the store card and a higher travel limit bring it to 18.0%.

The arithmetic

Overall utilization is the total of the balances divided by the total of the credit limits on open cards. Each card’s utilization is its balance divided by its own limit. A payment before the statement closes lowers the balance; closing a card removes its limit from the total; a higher limit or a new card adds to it. The payment to reach a target is the total owed minus the target rate times the total limits.

What the number does and does not tell you

Credit scoring models count how much of your available credit you use; FICO describes amounts owed as about 30% of a FICO Score, and the CFPB suggests keeping utilization below 30%. Lower is generally better; no single number is a cutoff. Most issuers report the balance on your statement, so paying before the statement closes lowers what is reported even if you pay in full every month. Utilization has no memory in most scoring models: it reflects the latest reported balances. Paying on time matters more than any of this.

Sources

  1. Consumer Financial Protection Bureau, consumerfinance.gov. What is a credit utilization rate? and How do I get and keep a good credit score?
  2. myFICO. What’s in my FICO Scores?: payment history about 35% and amounts owed about 30%, for the general population.
  3. Fair Credit Reporting Act (15 U.S.C. 1681 and following): your right to a free credit report and to dispute errors; AnnualCreditReport.com is the official site.
  4. Federal Trade Commission, consumer.ftc.gov. Free credit reports and Disputing errors on your credit reports.

The worked example is made up. The page works out utilization from the figures you enter; it cannot see your credit report and does not predict a score. It is not financial advice. Your figures stay in this browser. Support: team@caveatacademic.com.