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I handle my credit like this:

  1. Pay for everything possible with 0% APR accounts.
  2. Put at least an identical amount into an interest-bearing account.
  3. Pay off the card when I want to maximize my credit score.

The benefit of this is that I'm able to achieve better interest than any credit card would yield in rewards, so it's the optimal way to make the best use of credit cards, where interest is concerned.

The drawback comes from the lack of immediacy in credit score updates. For example, I've seen my credit score go up 120 points over one month, using this technique.

I'm very unimpressed with the inability of the system to accurately judge creditworthiness when employing this strategy. Is there something that can be done, to eliminate associated score volatility?

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    I don't understand what the question here is. Do you think there's a problem with how the score is being calculated? Commented May 20, 2022 at 19:35
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    Just because you have the money to pay your debt doesn't mean it's not a debt before you actually pay it.
    – chepner
    Commented May 20, 2022 at 20:30
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    @Jessy Until you complete step 3, you owe the creditor money - how is that "not actually debt"? Having money in a regular savings account doesn't prove that you'll actually use it to repay the creditor - you could take out ten $100 debts and show each lender $100 in your bank account, which would be meaningless to them. An escrow account might be a way to prove that you have money specifically earmarked to pay the debt, but I'm not aware of credit card escrow services. Commented May 20, 2022 at 20:32
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    Voting to close. This reads more like a rant than a question. Clearly you understand how credit scoring works, you just don't like it.
    – littleadv
    Commented May 20, 2022 at 20:54
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    “The system” was never designed to be intelligent. I’m not sure why you would expect it to be intelligent, it doesn’t even know your income or assets. It’s a pretty low-IQ system.
    – quid
    Commented May 20, 2022 at 22:40

1 Answer 1

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Probably not.
Credit scores are calculated based on statistical behavior, and people that run up an increasing amount every month on their credit cards statistically are a bad risk - your behavior is the outlier; typically, people run up their totals because they are spending more than the can afford.
Consider that nobody is looking at your profile / overall behavior to calculate your credit score; only an algorithm calculates certain key performance values, and those are the basis for the credit score calculation.

There are several other good strategies for optimizing your personal situation, that are 'uncommon' enough so that the statistical interpretation is 'bad risk', and not 'clever guy'.

Just live with the result; any credit score over 740 is in practice equally good, and trying to squeeze it towards 850 is useless self-satisfaction. If you are at risk of touching 750 on the down swings, plan large activities (like buying a house or a car) for two month after you paid everything off.

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  • Do you know if there's somewhere to file a bug report? I have no idea who maintains the algorithms.
    – Jessy
    Commented May 21, 2022 at 16:20
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    Every company has their own algorithm, there are dozens of variants. Also, it is no bug - it is a statistical calculation, and there are always outliers. A six-sided die rolls an average of 3.5, but every time you roll, you get a different number than 3.5, that's the nature of statistics.
    – Aganju
    Commented May 21, 2022 at 16:48
  • The bug is in the design, not the implementation. Somebody has to be informing the implementers, and surely they'd like to be provided with better information at the further expense of our privacy. None of these people can have thought of everything—they have some kind of bug reporting and fixing system, but it's possible that it's completely internal, with no external input possible. Which seems like it should be illegal, to me, given the ramifications of credit scores to citizenry.
    – Jessy
    Commented May 21, 2022 at 17:10

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