@Anonymous wrote:
@Anonymous wrote:I was just curious as to what other peoples maximum exposure is vs their income. If you don't want to give your income just a percentage perhaps.
I'm poor so my income is about 32K per year and $21K total credit limit.
Welcome....
My answer will be non-conventional, as am I (you'll get to see that
)
IMO the phrase 'maximum exposure' is a misnomer in the way it's proposed here IF we are to be masters of our own fate.
That is the CL given by the vendor is only 'exposure' if one allows it to be....if we treated our accounts properly our 'max exposure' would be and should a number MUCH LOWER than the CL 'given' by the CCC
It's our goal 'supposedly' to push up the CL, more so to manipulate the 'range' between what we have set as our personally disciplined financial exposure limit vs 'whatever' our CL may be......
If we act in that finacially, disciplined manner the question is a moot one....meaning that a person who KNOWS that their income is 30-40k...should 'see' 100-150k in total CLs as anymore than a way for his/her debt load to comfortably fit within his/her credit profile w/o killing their credit score.
Many ppl don't grow their CLs saying 'I'll never USE that much' ...the truth is OF COURSE you shouldn't USE that much but the way the system scores you want that nuber to be WAY above what you ever would ....if not the moment you carry a balance the debt load could damage your risk rating ie your credit score.
Bottom line 30k annual income has nothing to do with:
10k debt / 25k cl = 40% utilization is WORSE than the same
10k debt / 75cl = 13% utilization
So, the CL IMO shouldn't be looked at as a max exposure....your max exposure should be a number your lifestyle and financial budgeting create for you...and you build your CLs most higher so that whatever number you decide will still keep your risk rating down!
This. I could get by honestly with just my CSR for my usual monthly spends if I didn't want to think about credit. But last month I purchased 2 new company trucks and put both of them on credit, that was honestly pretty neat, just by making a purchase I was planning on making anyway I had received almost 100k points between the three cards I used to buy them, and then paid them off, I hope to make large purchases like this at least twice a year to help grow my limits and demonstrate usage, as well as earn rewards. Before this I would never have thought of such a thing lol. Large ticket items I usually write a check for. But that was before I started playing a mild churning game and understood utilization. I now plan what card im going to use for a purchase depending on what kind of purchase it is to garner the most rewards back. Which honestly I find kinda fun, and I just like knowing I have a last resort emergency reserve if ever needed. If at 3 am on a Sunday I needed 50k for whatever reason I have it.
@tacpoly wrote:
@Anonymous wrote:...So, the CL IMO shouldn't be looked at as a max exposure....your max exposure should be a number your lifestyle and financial budgeting create for you...and you build your CLs most higher so that whatever number you decide will still keep your risk rating down!
But people should keep in mind that very high CLs in relation to income can increase risk rating as well. How many people here have we seen get repeatedly reviewed?
I'm at ~20% of income. That's enough credit for my needs and splurges while also keeping % utilization low. I don't plan to ever max my credit lines, but if it happens, I can pay it off. So at worse it will be a temporary score drop therefore unlikely to result in an adverse action.
Reviewed due to high credit limits? Thats actually pretty rare, if it happens at all. There is almost always something else, like they are carrying balances on several cards, etc.
