Credit Card Utilization Calculator
Your Total Credit Utilization is:
0%Good
Total Limit: $0 | Total Balance: $0
What is Credit Card Utilization?
Credit card utilization is the ratio of your outstanding credit card balances to your total available credit limits. It is one of the most influential factors in calculating your FICO and VantageScore credit scores, typically accounting for about 30% of your total score calculation.
How to Calculate Your Utilization Ratio
The formula for utilization is straightforward. You sum up all the balances across your revolving credit accounts and divide that number by the sum of all your credit limits. Finally, multiply by 100 to get the percentage.
Formula: (Total Balances / Total Credit Limits) x 100 = Utilization %
The "30% Rule" for Credit Scores
While there is no magic number, most financial experts suggest keeping your utilization below 30%. However, consumers with the highest credit scores often maintain a utilization ratio below 10%. High utilization signals to lenders that you may be overextended and represents a higher risk of default.
Example Calculation
| Account | Credit Limit | Balance |
|---|---|---|
| Card A | $5,000 | $2,000 |
| Card B | $10,000 | $500 |
| Totals | $15,000 | $2,500 |
In this example, the calculation would be: ($2,500 / $15,000) x 100 = 16.67% Utilization.
Tips to Lower Your Utilization Ratio
- Pay down balances early: Make payments before your statement closing date so a lower balance is reported to credit bureaus.
- Request a limit increase: If you have a good payment history, your issuer may increase your limit, which lowers your ratio (as long as you don't spend more).
- Keep old cards open: Closing an unused card reduces your total available credit, which can cause your utilization ratio to spike.