(Editor’s note: this interview was the fifth of six installments that ran during the week of August 18-22, 2008. To get the most from it, be sure to read my introduction article, which can be found here.)CM: Trevor, feel free to tell my readers a little something about yourself.My name is Trevor. I’m a 27-year-old male residing in the Twin Cities, MN. Along with family, I own and manage an established marketing company. Although I enjoy traveling for business and pleasure, I look forward to coming back home to enjoy everything Minnesota and its seasons have to offer. In the summer you’ll find me with friends on the lakes boating/sailing, waterskiing and swimming. During the winter I’ll be snowboarding and downhill skiing. Other favorite hobbies include painting, drawing, tennis and biking.CM: Trevor, what are your FICO scores?My scores range from 768 to 799.CM: When did you get your first credit card?While I was still in high school, my parents added me as an authorized user on a few of their cards – American Express, MasterCard and Visa. I continued use those cards exclusively through the first couple years of college. Then one day while in a Barnes & Noble, I spotted a credit application for the store’s MasterCard offered by MBNA. I decided to apply and was approved. It was the beginning of my credit independence.CM: How many credit cards do you have (all types)?I currently have 43 open cards, both personal and business. This includes a mix of Visa, MasterCard, American Express and Discover.CM: How did you learn about credit? Who taught you about credit?Before I was given the authorized user status by my parents, they drilled financial responsibility into my head. They taught me how to make money work to my best advantage. But they also warned me that if I don’t make wise decisions, I could lose money and give someone else that advantage.My real “credit” education began in early ’04, when I stumbled upon Creditboards. There I began reading and absorbing valuable information. It didn’t take me long to discover I had been a victim of believing popular myths such as “too much credit is bad” and “it’s ok to close old accounts” to avoid keeping too many cards.CM: What advice would you give to someone just starting out in credit?Don’t make the mistake of applying for several store cards before obtaining a solid base of bank cards. Store-only cards often do not pay you back in terms of rewards and benefits given by major bank cards. You should plan long term for your credit profile. Obtain at least one of each first – Visa, MasterCard, AMEX and Discover, and then build up from there. Potential lenders will appreciate the diversity and regard you as a consumer with a handle on your credit rather than viewing you as an impulsive credit applicant.Don’t carry a balance unless you have no other resources to pay in full. Even the enticing 0% offers are often risky to your credit when current lenders are reviewing your account. Many people are often misled into thinking carrying a balance and paying interest to a lender will bring credit line increases faster and more prolifically. This is not true. Lenders will grant credit line increases to customers they view as responsible and those they deem having the resources to pay back the loans. Carrying a balance is a red flag that the customer may not have the means to meet their obligations. Using the card frequently and paying back in full is the best recipe for increasesCM: If you knew then what you know now, what would you have done differently in your credit life — if anything?I would not have closed my Target Visa and a couple other cards that I obtained early on and thought I had outgrown. As I previously indicated, I believed the old credit myths before finding CreditBoards. Fortunately, I quickly learned that I was on the wrong path with my credit and didn’t close more cards. So, I began my plan of obtaining additional cards with rewards best suited for my needs.CM: What habits have allowed you to maintain such high scores? What do you think the most important thing you do is?I use my cards heavily for both personal and some business expenses. And although my utilization room includes a nice cushion, FICO does not like to see many accounts reporting at one time. So, I never allow more than 6 cards to report a balance each month. I’ve compiled my card activity into an Excel workbook. Each card has its own page, and they are all linked with highlighted due dates for each in a summary. I transfer payments early to the lender for several cards to avoid having too many balances at the cutoff dates. This way I can ensure that 6 or fewer cards will report to the bureaus at all times.I’ve never engaged in the infamous “app-o-ramas.” This involves applying for many cards in one day to eliminate any of these new accounts reporting before other lenders take notice of this activity. The problem is that eventually the new accounts do start reporting and cause FICO scores to take a sudden tumble. Many lenders now have a system in place that flags a customer’s reports for suspicious activity. And, this sudden ramp up of cards does not go unnoticed during a routine account review. So, I apply for cards gradually, which prevents scores from dropping too many points at once. This method allows the scores to recover before within a couple months and before I apply again. My goal is to eliminate as many red flags as possible, and at the same time build my card profile at a slow, cautious pace.CM: If you have a lot of credit cards, tell us why you feel the need for all of them. If you have relatively few cards, why haven’t you decided to get more?Each card serves a purpose in my profile. Basically, I keep them working for me. They grant me rewards on various categories of purchases, and perks such as lounge access, concierge service and buyer protections. No one card gives the bonus rewards in every category, and each program has a limit to how many points may be earned within a time period. I often surpass these limits quickly. In order to continue earning the bonuses on purchases, I need additional cards with similar reward structures. This does involve tracking of spending and revolving cards within the wallet. But the effort is well worth it for me. Due to my heavy charge usage, I also need high credit limits and vast utilization room, so FICO will not punish my scores.CM: What is your favorite credit card? Why?I always find this question a tough one because my favored card depends on my charge needs for the day. However, there are two cards that for the most part that never leave my wallet — American Express Platinum and Merrill + Visa.The American Express Platinum grants me membership rewards on every purchase. The more points I earn, the more valuable the rewards and perks. I also receive complimentary airline lounge access and concierge/event perks. Of course there is an annual fee for this card, however my usage throughout the year overrides that expense. My Merrill+ Visa is accepted everywhere. It’s also my highest limit and lowest annual percentage rate card to date. The purchase points transfer into excellent rewards, and extra benefits are granted as the point total rolls over into a higher tier levelCM: Have you ever been late on a credit card payment? If not, how do you stay on top of your bills?I’ve never been late on a payment. I use an Excel workbook to record card activity and it is set up to track due dates. I pay either before the statement cuts or shortly after. That gives plenty of time before the actual due date.CM: Why do you think people run into trouble with credit cards?I believe most people don’t understand the importance of good credit and how it affects them directly. Many people are surprised when I tell them FICO is watching them and credit carelessness such as late payments are lethal to a good score. Late or slow payment plans have the potential to damage your credit; paying on time and in full will keep your credit on top.CM: When did you first become aware of FICO scoring? Did you ever think that you wanted to reach a certain goal with your scores? In other words, did you always want to have an 800+ score?I first pulled my credit reports after obtaining a few cards. It was pure curiosity at the time. To date, I’ve not been motivated enough to pursue an 800+ score. My overall profile is young in age and the desire to apply for additional cards is stronger than seeing the 800 on my reports. I’ll get there, eventually.CM: What does having a high score represent to you? What does it do for you? Would you be just as happy if your score was 720? How about 680?I like to keep my score at 760 and above. This is high enough to be approved for any type of credit I desire and still have room to allow for score dips due to inquiries and/or new accounts. When my Equifax score dropped to 750 this spring, I got nervous and put a halt on applications for a longer time period than my usual pattern.CM: Any parting words for my readers? Some words of wisdom that you care to share?I can’t stress enough the importance of diversity in a credit card profile. One should have a card with at least one credit union and a healthy mix of several banks. The recent bank mergers, buyouts and closures will likely have at least some effect on card profiles and these activities are rarely good for the customer. It is also beneficial that current and potential lenders see their competition on a report. A growing bank will attempt to lure their good customers’ business away from this competition with higher limits and incentive offers for card usage. Simply put, diversity is power for the consumer.It is up to the consumer to build and maintain an excellent profile. This does take some time and effort but once established it becomes routine. The satisfaction and rewards are immeasurable.CM: Thanks, Trevor, for taking time out of your schedule to answer these questions.
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