All right, it's time to debunk some of these credit card myths that i've been hearing about. I get these questions quite often in my dms. I never have an issue answering them, but i figured since i get these questions quite often whether it's on twitter or instagram make sure you're following me at the cc maestro on all platforms. I figured i'd, make a video on it to really go over the five most common myths, questions that i receive statements that i hear and then i'm looking like.

That's not really true. So, let's get right into the video number one. Making the minimum payment on a credit card is enough false. Now it is enough to satisfy the payment, but it's not enough to save money on interest.

It's not enough to make sure you're out of debt to make sure you don't lose track of how much you're spending so false. Making the payment is not enough. It only satisfies the minimum payment, but you're still going to be charged interest. Possibly, you know run into debt if you're, not managing your money correctly.

Making the minimum payment is not enough. Now, it's good if you make a payment, so you have no latest on your credit report but making them a payment is not enough. Your goal should always be to make sure you're in the best position possible at all times, if you don't have it in your pocket as far as cash or on your debit card or your checking account, you don't spend on your credit card unless it is a Really, really, you know dire need of an emergency. You don't spend on your credit card.

We don't have it two. Having only one credit card, you only need one credit card, that's enough for you having more than one credit card is bad for you. That's the myth right there and that's false. I have a lot of credit cards, don't have one and the reason i don't just have one is because each credit card that i have gives me a specific purpose for that card.

There are times where i will switch credit cards out. You know, depending on the time of the year, with bonus categories i have as far as cash back or travel or what i'm trying to do, or what's going on in my life, currently having one credit card. There's nothing wrong with it, but you should definitely have more one credit card is gon na, probably be for travel. One's gon na be for cash back one's gon na be for groceries one's going to be for emergencies.

One's going to be it's so many different things that you can do with multiple credit cards having one credit card, if you are someone who likes to get the rewards from credit cards, you're really limiting yourself a lot of credit cards, mostly any credit card. One credit card does not help out a hundred percent with everything you could do with these credit cards, you need to carry a balance. To build. Credit is number three.

This is the one that makes me cringe the most false, false, false, false, false false. You do not need to carry a balance to improve your credit score. Let's just go over to the four things that you improve. Your credit score by that shows on the fico scores the fico score.

Chart 35 of your credit score, which is the biggest impact, is payment. History 30 is amounts owed. 15 is length of credit history. How long you've had credit for 10 is your credit mix, then the other 10 percent is new credit.

Nowhere in that chart did it say carrying a balance now it does say, amounts owed, but that is credit utilization and credit utilization, the lower the credit utilization, typically, the better credit score. So keep that in mind owing something on a credit card is not good. It's only good for the bank now, that's something that the bank is telling you guys and, of course, is good for them, because there's more money in their pocket, but we're not interested in making them more money off interest that make enough off of that. But we're at about you, so yes, that is a complete myth.

A high credit card limit is bad as number four. No, that is a myth. A high credit card balance is bad. A high credit card limit is good.

The higher the limit, the lower utilization typically and i'll, give you two examples: if the number that you want to stay under is ten percent, and you have one person who has a thousand dollar credit limit versus somebody who has a ten thousand dollar credit limit, the Person with a thousand dollars can only spend one hundred dollars to keep at ten percent, and the person with a ten thousand dollar limit can spend a thousand dollars so the higher the limit, the better because it lowers your credit utilization, so say that one more time The higher the credit limit, typically the lower credit utilization, as though, as you just saw in that scenario, it's both 10 one person can only spend 100 and the other one can spend a thousand, and that is because that other person has a higher credit limit. Number five is people telling you to close out credit cards, specifically ones that do not have annual fees now this is wrong. Closing out credit cards within itself can hurt your credit score. It's going to affect the length of your credit history as well, because you've closed out a card, especially because that's your oldest credit card, but here's what i would say, keep those credit cards open just to keep it simple, because there are so many things, especially when You're playing the travel game like i do, i do close out some credit cards and stuff like that, but that's for other reasons.

They kind of keep it very simple for everybody, closing out credit cards that don't have any negative or positive impact on your credit, or your money doesn't really make sense. If you have a credit card that is not really making you money, but you're, also not losing money, just keep it open and i would suggest especially if it's your oldest credit card, please keep it open because you will see a decrease in your average length of Credit history and that's not a good thing, you don't want any issues with your credit. If you have a credit card, it gives you no rewards has no annual fee and it just sits in your drawer. Keep it there now.

I will suggest making a small monthly subscription or something like that: hulu netflix, gym membership or go to the dollar store and swipe the card for a dollar once a month or something like that just to keep the card open if it's not hurting you, but it's Also, not helping you and it's just a net gain or loss of zero. Just keep it there nine times out of ten, it's going to be better to keep it with you than not having it at all hope. These myths made sense. If you have any other myths that you've heard or you have anything that you want to talk about down below comment down below dm me, follow me on instagram at the ccmaestro i'll, be happy to help and for people who are more experienced.

If you guys want to help out down low as well, i will always review all the comments to make sure the information is correct, but you have people who are asking questions before i can get to them and you want to answer them for free and i Will always make sure that the information is correct and i truly appreciate it. I hope you guys, like this video, make sure you are safe out here, make sure you also like the video share it subscribe and i'll talk to you soon. You.