CardTrack.com says “the percentage of people delinquent on their credit cards is the highest it’s been in three years,” according to CNN. Over the past year, U.S. consumers have charged “more than $2.2 trillion in purchases and cash advances.” The article gives the usual advice: Stop buying stuff! Pay more than the minimum! Use the debt snowball technique to pay off your cards efficiently! They also speak with a man from Credit.com who says keep your balances under 10% of your credit limit—in fact, a “utilization rate of no more than 7%” is optimal.

As a rule of thumb, you should try not to use more than 10 percent of your credit limit when making purchases. “The people with the best credit have a utilization rate of no more than 7 percent,” he says.

If your credit utilization is 50 percent or more of your credit limit, you are doing some real damage to your credit score, says Craig Watts of Fair Isaac, one of the companies that provides credit scores. When the new FICO ’08 scoring model is adapted in May, if you have a utilization of over 50 percent, you’ll be penalized even more heavily.

May’s just around the corner! If you’re one of those people who lives and dies by your FICO score, you’ve got a couple more months to knock down that debt.

“When credit cards put you in jeopardy” [CNN]

RELATED
“Do-It-Yourself Debt Reduction” [Credit.com]
“The Debt Snowball Technique”
(Chart: CardTrak.com)

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