How often should I use my secured credit card?

You can build credit with a secured credit card in as little as one to two months, but it will take many months or even years to build a consistently good or excellent credit score. The length of time also depends on whether you’re building credit from nothing or rebuilding damaged credit.… read full answer

If you have no credit, you could see a good score after just a few months of paying on time. You’ll have a VantageScore after one month and a FICO Score after 6. With bad credit, though, it will probably take 12-18 months of responsible use for you to move up to the fair credit range. Secured credit cards are great for building credit because they are easy to get and report to the credit bureaus just like unsecured cards.

But it's hard to give you an accurate estimate of how long it will take to build credit with a secured credit card without knowing the details of your situation. That’s where WalletHub can help. Just sign up for a free account, and we’ll give you a personalized credit analysis that will tell you what to improve and give you a better sense of how long it will take.

Here’s how long it takes to build credit with a secured credit card:

• If you have no credit, it will take 1 month to get a VantageScore and 6 to get a FICO score. Depending on how responsibly you use your card, your first score could be anywhere from bad to good.
• If you pay your bill on time and otherwise manage your finances responsibly, you can rebuild from a bad credit score (300-639) to a fair credit score (640-699) in approximately 12-18 months.
• A good credit score based on limited information could easily fall due to an increase in credit utilization or a single missed payment. Building and then keeping a good or excellent credit score requires consistency over time. This is a project measured in years.
• For people rebuilding credit, it will take 7-10 years for some negative information, like bankruptcies and late payments, to disappear from your credit report. But the older they are, the less impact they will have on your score.

If you’re looking to rebuild your credit, secured credit cards are the best way to do it. They’re easy to get and are indistinguishable from unsecured cards aside from the deposit requirement.

Rebuilding credit will take a while, so it’s best to get started as soon as possible. Some good behaviors to practice are always paying on time and using less than 30% of your available credit.

Checking your credit reports regularly for errors and disputing any you find is also important.

Requesting a credit limit increase will likely trigger a hard inquiry and cause a short-term decrease in your credit score. Receiving an automatic credit limit increase (i.e. your issuer increases your credit limit without you asking) will not hurt your score. No matter how you receive a credit limit increase, it will provide long-term credit-score benefits to responsible users.… read full answer

A credit limit increase will give you access to more available credit to use. As a result, you will get a better credit utilization ratio, assuming your spending does not increase, too. The lower the ratio, the better your credit score. If you continue to spend and maintain a high balance on your account, you will see a negative impact on your credit score. A credit limit won’t help your credit score if you just max it out immediately.

Yes. Two secured credit cards can help more than one because using a second secured card responsibly will increase the amount of positive information that gets reported to the credit bureaus each month. This will lead to more credit score improvement than one secured card would produce, as long the bills get paid on time. Getting two secured cards also raises the cardholder’s total credit limit, making it easier to keep … read full answercredit utilization low overall.

That said, it isn’t necessary to have two secured cards. It’s certainly possible to build a good or even excellent credit score using just one. In some cases, having one secured card instead of two will actually be the better option. If you have trouble keeping track of payment due dates, for example, you probably shouldn’t apply for more cards. Missing due dates will hurt your score way more than adding another card will help it. In addition, many secured cards have annual fees, and all of them require security deposits, so having more than one secured card can be expensive.

Finally, keep in mind that secured cards aren’t going to be the most competitive cards on the market, so you shouldn’t ever get four or five of them. Instead, get your credit score up using one or two secured cards, then move on to unsecured cards with no annual fee, and finally go for the credit cards with the best rates and rewards. To make sure you’re on the right track, you can check your credit score for free on WalletHub.