TPG reader question: Does it hurt to pay off your card balance before the billing cycle ends?

Oct 4, 2021

This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.

Editor’s note: This article is part of our weekly column to answer your credit card questions. If you would like to ask us a question, tweet us at @thepointsguy, message us on Facebook or email us at 

Understanding and maintaining your credit score is one of the most important parts of a successful financial (and travel) plan.

Not only does it help you avoid making costly mistakes, but it will also make sure you stay eligible for some of the most valuable sign-up bonuses and welcome offers for points and miles. TPG reader Connie McCarroll wants to know when exactly she should pay her bills and if it’s possible to pay too early.

Want more credit card news and advice? Sign up for our TPG newsletter

Does paying off credit card balances before the end of a billing period make it appear like you are not using your credit cards at all?  If so, would it be better to wait until the billing period has ended and then pay off the balance?

Connie McCarroll

Keeping your credit score high requires a thorough understanding of the factors that influence it. While the exact formula used to convert your financial history into a single number is a closely guarded secret, the factors that are analyzed and the weight they are given is very much public information.

Related: How to check your credit score for absolutely free

The factors that make up your FICO score. (Image source: FICO)

Your monthly credit card balances fall under the “amounts owed” section, often referred to as “utilization,” which accounts for 30% of your score. This number is reported as the ratio of your balances to your overall credit limit. If you spend $2,500 on a card with a $5,000 limit, your utilization will be 50%. But if you spend the same amount on a card with a $20,000 limit, your utilization will only be 12.5%.

Generally, the lower your utilization is, the higher your credit score will be. If you’re maxing out all your available credit lines, banks see you as a riskier customer. According to Credit Karma, a 9% or lower utilization ratio is ideal, though 10-29% is also considered “good”.

Related: How does applying for a new credit card affect my credit score?

If you pay your balance before the end of the month, your credit card will report a lower number for the amounts owed to the credit bureaus, and your utilization ratio will remain low, improving your credit score over time. If you’re not in a financial position to pay your bills early, don’t worry. When you make your payment (usually two to three weeks after), that information will be reported to the credit bureaus and your utilization ratio will come down.

You can even use this strategy to your advantage. If you’re applying for a mortgage or car loan, where a higher credit score can save you some serious money on interest, it might help to pay off all your credit card balances before applying. Not only can this increase your chances of loan approval, but it also might land you a more favorable interest rate.

Related: 6 things to do to improve your credit in 2021

One final thing to keep in mind is that, even if you don’t want to pay your entire balance off before the statement close date, it could be worth paying off a specific large purchase to avoid a big change to your utilization ratio. For example, one TPG staffer charged $7,000 in expenses to his Chase Sapphire Reserve and decided to pay it off before his statement closed.

His reasoning? Otherwise, his utilization ratio on the card would have appeared to be more than 40%, potentially impacting his credit score.

Bottom line

There’s no harm in paying off your balances early, and it can even help keep your credit score sky-high.

Even if there aren’t any $0 balances being reported to the credit bureaus at the end of the month, your on-time payment history and length of account history will continue to work in your favor building your credit score. Of course, the most important thing is not to miss a payment and avoid racking up expensive interest. As long as you make sure to pay your bill by the due date, you’ll be fine.

Thanks for the question, Connie, and if you’re a TPG reader who’d like us to answer a question of your own, tweet us at @thepointsguy, message us on Facebook or email us at

Additional reporting by Chris Dong. 

Featured photo by My Agency/Shutterstock.

Delta SkyMiles® Platinum American Express Card

Earn 90,000 bonus miles after you spend $3,000 in purchases on your new Card in your first 3 months. Offer ends 8/3/2022.

With Status Boost™, earn 10,000 Medallion Qualification Miles (MQMs) after you spend $25,000 in purchases on your Card in a calendar year, up to two times per year getting you closer to Medallion Status. Earn 3X Miles on Delta purchases and purchases made directly with hotels, 2X Miles at restaurants and at U.S. supermarkets and earn 1X Mile on all other eligible purchases. Terms Apply.

Apply Now
More Things to Know
  • Limited Time Offer: Earn 90,000 bonus miles after you spend $3,000 in purchases on your new Card in your first 3 months. Offer ends 8/3/2022.
  • Earn up to 20,000 Medallion® Qualification Miles (MQMs) with Status Boost® per year. After you spend $25,000 in purchases on your Card in a calendar year, you can earn 10,000 MQMs up to two times per year, getting you closer to Medallion® Status. MQMs are used to determine Medallion® Status and are different than miles you earn toward flights.
  • Earn 3X Miles on Delta purchases and purchases made directly with hotels.
  • Earn 2X Miles at restaurants worldwide including takeout and delivery in the U.S., and at U.S. supermarkets.
  • Earn 1X Miles on all other eligible purchases.
  • Receive a Domestic Main Cabin round-trip companion certificate each year upon renewal of your Card. Payment of the government imposed taxes and fees of no more than $80 for roundtrip domestic flights (for itineraries with up to four flight segments) is required. Baggage charges and other restrictions apply. See terms and conditions for details.
  • Enjoy your first checked bag free on Delta flights.
  • Fee Credit for Global Entry or TSA PreCheck® after you apply through any Authorized Enrollment Provider. If approved for Global Entry, at no additional charge, you will receive access to TSA PreCheck.
  • Enjoy an exclusive rate of $39 per person per visit to enter the Delta Sky Club® for you and up to two guests when traveling on a Delta flight.
  • No Foreign Transaction Fees.
  • $250 Annual Fee.
  • Terms Apply.
  • See Rates & Fees
Regular APR
17.24%-26.24% Variable
Annual Fee
Balance Transfer Fee
Recommended Credit
Terms and restrictions apply. See rates & fees.

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.