The percentage of your available credit that you're currently using. This is the second largest component of your credit rating your credit score

For example, if you have a $1,000 credit limit and a $500 balance, your credit utilization is 50%.

This ratio makes up about 30% of your credit score, so it matters. Lower is generally better—aim for under 30%, but under 10% is even better. The beauty of utilization? Unlike payment history, it has no memory. Pay down your balances, and your utilization (and credit score) can improve within a month or two.