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Credit Card Percentage Calculator

Credit Utilization Ratio Formula:

\[ CUR = \left( \frac{B}{CL} \right) \times 100 \]

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1. What is Credit Utilization Ratio?

The Credit Utilization Ratio (CUR) measures how much of your available credit you're using. It's a key factor in calculating credit scores and assessing financial health.

2. How Does the Calculator Work?

The calculator uses the Credit Utilization Ratio formula:

\[ CUR = \left( \frac{B}{CL} \right) \times 100 \]

Where:

Explanation: The ratio shows what percentage of your available credit you're currently using. Lower percentages are generally better for your credit score.

3. Importance of Credit Utilization

Details: Credit utilization accounts for about 30% of your FICO score. Keeping your utilization below 30% is recommended, and below 10% is ideal for optimal credit scores.

4. Using the Calculator

Tips: Enter your current credit card balance and total credit limit in any currency (but both must be in the same unit). The calculator will show your utilization percentage.

5. Frequently Asked Questions (FAQ)

Q1: Why is credit utilization important?
A: It's a major factor in credit scoring models, showing lenders how responsibly you use credit. High utilization may suggest financial stress.

Q2: What's a good credit utilization ratio?
A: Below 30% is good, below 10% is excellent. The lower your utilization, the better it is for your credit score.

Q3: How often should I check my utilization?
A: Monthly, since credit card issuers typically report balances to credit bureaus once per month.

Q4: Does utilization include all cards?
A: Both individual card utilization and total utilization across all cards matter for your credit score.

Q5: How can I lower my utilization?
A: Pay down balances, request credit limit increases, or open new credit accounts (but avoid applying for too much new credit at once).

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