Simple question about CLIs...

[Anonymous]

I'm new to this forum, and while I have been sporadically using credit cards for several years, I've never truly taken advantage of them (I.e. Simple ones with extremely sad rewards....waiting for CSP to be approved)! And so in a sense, don't really understand them like many here do (I just pretty much know to pay off in full every month and pay on time!)

that being said.... Why do people get SO excited when they get huge CLIs?  Like 15k plus?  Is everyone here that rich or am I missing something?!  Is can't solely be because it improves credit score...

[red259]

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@Anonymous wrote:

I'm new to this forum, and while I have been sporadically using credit cards for several years, I've never truly taken advantage of them (I.e. Simple ones with extremely sad rewards....waiting for CSP to be approved)! And so in a sense, don't really understand them like many here do (I just pretty much know to pay off in full every month and pay on time!)

that being said.... Why do people get SO excited when they get huge CLIs?  Like 15k plus?  Is everyone here that rich or am I missing something?!  Is can't solely be because it improves credit score...

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Well it helps with credit scores. It gives you more credit so that if you let balances report the impact on your score is not as significant. Some people like high credit lines, because they feel it shows they accomplished something in their credit journey. If you started off and all you could get was a $500 credit line and then two years later you are getting 15-20k credit lines that is a nice validation. Most people on here with high credit lines like that are not using them all up. 

[Anonymous]

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@Anonymous wrote:

I'm new to this forum, and while I have been sporadically using credit cards for several years, I've never truly taken advantage of them (I.e. Simple ones with extremely sad rewards....waiting for CSP to be approved)! And so in a sense, don't really understand them like many here do (I just pretty much know to pay off in full every month and pay on time!)

that being said.... Why do people get SO excited when they get huge CLIs?  Like 15k plus?  Is everyone here that rich or am I missing something?!  Is can't solely be because it improves credit score...

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Well for some people it can be just about credit scores.  While most of us here tend to over obsess with our daily scores they are indeed important.  They affect your ability to get mortgages, car loans , etc and the cost of those loans if approved.

Additionally a larger CL gives you more flexibility if you decide to make a large purchase and want to use your credit card to do so.  Having a large CL on one card tends to encourage other credit card issuers to give you the same or higher because you have shown your ability to manage a card with a high CL.

[Anonymous]

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@Anonymous wrote:

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@Anonymous wrote:

I'm new to this forum, and while I have been sporadically using credit cards for several years, I've never truly taken advantage of them (I.e. Simple ones with extremely sad rewards....waiting for CSP to be approved)! And so in a sense, don't really understand them like many here do (I just pretty much know to pay off in full every month and pay on time!)

that being said.... Why do people get SO excited when they get huge CLIs?  Like 15k plus?  Is everyone here that rich or am I missing something?!  Is can't solely be because it improves credit score...

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Well for some people it can be just about credit scores.  While most of us here tend to over obsess with our daily scores they are indeed important.  They affect your ability to get mortgages, car loans , etc and the cost of those loans if approved.

Additionally a larger CL gives you more flexibility if you decide to make a large purchase and want to use your credit card to do so.  Having a large CL on one card tends to encourage other credit card issuers to give you the same or higher because you have shown your ability to manage a card with a high CL.

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+1 agree

[Anonymous]

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@Anonymous wrote:

I'm new to this forum, and while I have been sporadically using credit cards for several years, I've never truly taken advantage of them (I.e. Simple ones with extremely sad rewards....waiting for CSP to be approved)! And so in a sense, don't really understand them like many here do (I just pretty much know to pay off in full every month and pay on time!)

that being said.... Why do people get SO excited when they get huge CLIs?  Like 15k plus?  Is everyone here that rich or am I missing something?!  Is can't solely be because it improves credit score...

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Actually, for me, it's kind of like keeping score. How high will they go?  I have absolutely no intention of running them up even to 30%. I usually run less than 3% and frequently under 1%. I PIF almost all of the time.

[Anonymous]

The dirty little secret of the credit industry is that you're really not supposed to use anywhere close to credit limit you're given. So if you get a card with a $5k credit limit, that's effectively a $1500 credit limit.

[Anonymous]

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@Anonymous wrote:

The dirty little secret of the credit industry is that you're really not supposed to use anywhere close to credit limit you're given. So if you get a card with a $5k credit limit, that's effectively a $1500 credit limit.

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You can use it close to your CL.  just don't carry a balance close to your CL and make minimum payments for long.

[Anonymous]

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@Anonymous wrote:

The dirty little secret of the credit industry is that you're really not supposed to use anywhere close to credit limit you're given. So if you get a card with a $5k credit limit, that's effectively a $1500 credit limit.

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+1 for this, thats what i do with my CC. 

[revvystoke]

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@Anonymous wrote:

I'm new to this forum, and while I have been sporadically using credit cards for several years, I've never truly taken advantage of them (I.e. Simple ones with extremely sad rewards....waiting for CSP to be approved)! And so in a sense, don't really understand them like many here do (I just pretty much know to pay off in full every month and pay on time!)

that being said.... Why do people get SO excited when they get huge CLIs?  Like 15k plus?  Is everyone here that rich or am I missing something?!  Is can't solely be because it improves credit score...

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They come in handy for unexpected expenses. I had a 15k+ tax bill I had to pay at the beginning of the month after filing. Put it on my business Amex (hidden from personal reports), and just paid it off.