What do you do with all your credit?

[Anonymous]

Ain't that the truth Baller!

[UncleB]

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@Anonymous wrote:
Ooooh that's an interesting situation, having as much credit and annual income. I have a LONG way to go to get there. Which is a good thing. People who use credit responsibly get more credit than people who don't so it goes without saying that those with huge credit limits USUALLY don't charge them up to the max (barring a major event like poster said about car accident).

I like the idea of the UTIL cushion and I love the idea of someday my credit limits matching my income level. Although initially I'll be happy to just cover expenses. Lol it's the 9th of the month and I've already earned $12 in rewards on my QS1. Now I need to pay it and charge it up again (it's due the 28th so I may have 3 cycles before its time to pay it each month). To me, that's free money. Its earnings I don't have to pay taxes on as long as I PIF lol. But what if it was $100, $200 a month? That's where I want to get to.

What are you guys seeing as average cash back (or miles equivalent) per month?

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I'm getting around $50 per month... which is a lot less than some folks, but for my modest spending level I'm not complaining. 

Plus, it's literally free money! 

Taken at once it doesn't go very far, but over time it does add up... I'm almost going to be 'sad' when the day comes I actually spend it!  LOL

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@baller4life wrote:
My limits just sit pretty on my reports. Nice util padding. I maximize rewards whenever I can. But, truth be told, I'll never come close to using all of my limits. However, it's comforting to know I have the credit available just in case I do need it. From experience, when you need credit you can't get it. So, best to already have it on deck!

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+1

Truer words have never been spoken!  If there was ever a Credit-101, this should be taught on the very first day!   <drops mic>

(I also learned the hard way...)

[takeshi74]

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@Anonymous wrote:

My question is this: I see folks here who have a collection of insanely high credit limits. Tallied together anywhere between 50-150k. 

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High and insanely high are very subjective.  My total is outside your range and it's right where I want it to be and not high or insanely high.  Spend, budgets, and other factors vary from person to person so you can't assume that $X has the same impact in all cases.

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@Anonymous wrote:

What do you do with all that credit?

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We don't do anything with most of it other than ensure that my reported revolving utilization is around 8% without having to micromanage.  That's just where it ends up with our limits and spend.  If you understand the scoring and risk impact of revolving utilization you'll see that you don't want to use most of your available revolving credit -- at least, not for extended periods.  Short term high utilization generally isn't an issue but prolonged high utilization (and/or other issues with one's credit profile) can lead to adverse action.

Every once in a while cards may get used for major purchases.  We placed a kitchen remodel on one.  We just recently went to Japan and most of the expenses went on a couple of cards.  However, for the most part we just run our spend through the cards to maximize rewards on our spend.

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@Anonymous wrote:

Don't the cc companies lower limits after awhile if you can't at least periodically use those cards?

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Creditors are not all identical. Some lower limits with little to no usage. Some do not.  Some close out cards due to inactivity, some do not.  Do not assume that all creditors are identical.  Be aware of the specifics of each of your creditors.

[Anonymous]

Takeshi74, thanks for the sage advice. Unfortunately I understand the scoring models all too well (now). I only have two cc's and last month I let both report a balance (I usually only let one report a balance of <10%). $34 on a CL of $500 and $50 on a CL of $750. My score dropped 10 pts on TU and EQ. I was actually a little shocked it was that much. Paid the one off and it reports today so hopefully in the next few days I'll see those points Come back.

So you're right if I had higher limits then I wouldn't need to concern myself with small balances reporting tanking my score .

[Anonymous]

Also no creditor is going to come out and say "we regularly balance chase or AA or close your card if you don't charge it" so knowing your creditors would be quite hard unless you learn from experience. This site is certainly helpful to try to learn from others' anecdotal stories but at the end of the day every profile is different.

How do you suggest one can "be aware of the specifics of each of your creditors" without experiencing as you go along? Thanks!

[jbsea]

BMHILL,

good question....  Well my go to card is my amex prg so it does not even show a limit.  My  second card is nfcu which I use if they don't take amex.  DW likes her discover card so she uses that and the amex ed card.  but really all the other cards just sit get SD.  They are there to pad utl.  We did use the venture to by furniture this month with the plan it would take us two months to pay back, which made me get the slate so we would not have to pay interest (i always believe that if you pay interest then you lost the rewards) so that and more credit.  But overall we use 4 cc and run about $5000 a month total on them.  Since joining this form i've become overly obsessive about my credit and I look at everything as soon as I wake up.  Sometimes I do think it would be much easier with only one or two cards but I also like knowing if we really needed credit we have it.  I know that if you need it, it is probably to late to get it.  So I guess part of it is just piece of mind. 

[Anonymous]

Speaking of UTIL: I never knew how it worked until I found this place. Whenever I'd taken a BT, I'd always worked out what I could take with the fee (if there was one) to get right up to the limit. I'm sure I'd gone to 99% of cards 8-10 times. And we definitely maxed our two HD cards with the kitchen reno. 100%. 

Now I know that, while having the low interest CU cards in the wings is nice, I'd like the limits on THOSE to be even higher so that if I do BT to them, the util won't kill me. 

I recently did a BT to Slate. When I got the card, I BT'd up to the $3500 limit. This time, I moved limits around with Chase to get the CL to $10k and only BT'd $4k. I'm teachable. 

[Anonymous]

Jbsea, to your point about being obsessed with credit, I thought I would only need this forum until my mortgage but because I didn't credit build (with cards ) beforehand and knew NOTHING about rewards , now I have new goals after mortgage closes. But I think I will stop paying for score updates. Once I app spree after next week I'm going to cancel my subscription and just keep free services. Since I'll be gardening awhile, I really don't want to become obsessed with scoring Anymore. Because there will be nothing to app for. I believe some of the credit cards I will have come with free ficos anyway and I'll utilize that for occasional monitoring. in 6 months my credit profile will looks a world different anyway (it kind of annoys me when I see people's responses to other posters and they act like they were born with 800+ scores and they are so patronizing...MAYBE some have always used their credit perfectly but IMO that's a unicorn). So I really appreciate yours and others responses to this thread and not being condescending lol.

[Anonymous]

BOA Better balance:  7500 limit-  I place a 42 dollar internet bill on it monthly. 

BOA Cash Rewards:  5000 limit-  I put my netflix on this to keep it active.  Other than that it has no use I can beat it with other cards. 

Cap 1 Quicksilver:  10,000 limit-  I get 2% with Discover it so I just buy something small with this every once in a while to keep it active. 

Sallie Mae:  5,000 limit-  Gas+Groceries+Amazon when one of my 5% cards doesn't have it.  This gets the majority of my spend.

Discover It-  14000 limit-  Discover Deals general spend (for double cash back) and 5% categories

Chase Freedom-  3000 limit-  5% categories that Discover It doesn't have. 

AARP Rewards-  4500 limit-  Dining at places that I don't get a gift card in advance for. 

Amex Blue Cash Everyday 10000 limit-  Is beat by everything I have so I just use it every once in a while to keep it active.   

For the most part Discover It and Sallie Mae get the most work.  I use cards that give me the best rewards for what I'm buying.  I have 59,000 in available credit and probably only spend around 1100 on credit cards each month.  So I guess for the most part you could say I don't do anything with most of my credit. 

Big thing to keep in mind is to just spend on what you want/need.  Do not "chase" rewards simply because you have a good rate of return.  10% is a great deal on discover it, but it will cost you if you buy a bunch of stuff you would not have bought simply to "get" the reward.  The way I think of rewards is not as money "earned" but as money saved.  As in I saved 10 dollars by using my Discover It for the 100 on Amazon, not that I "made" 10 bucks by spending that 100. 

[Open123]

Ah, I actually use quite a bit of it.  On any given month, I'd say my Utility ranges from 20% - 40% of the aggregate, but mostly in a few cards.  However, if I'm getting ready to app for a few cards, I'll pay before the due date, and have about 5% Utility reporting on a single card.