topic Re: What do you do with all your credit? in Credit Cards

What do you do with all your credit?

Anonymous — Thu, 08 Oct 2015 22:46:25 GMT

This is a completely honest question and I ask it purely out of curiosity. After our mortgage closes next week, we will have approx total of $6000 in monthly expenses. That's mortgage, car payments, student loans, utilitities, groceries, gas, child care, insurance, etc etc.

After we close, we are going to app for NFCU rewards, BofA, and a few other rewards cards. I only have 2 cards at the moment and the CL's are really low due to rebuilding.

So, just recently I PC'd by CapOne Plat to the QS1 and the last 2 months have been putting as many expenses through as I could to get the 1.5% until I hit the limit of $750, PIF and do it again.

From reading here, we have a very high chance of getting a decent limit on just the NFCU card, not to mention the others I will app for and will likely get a few. We made pretty good salary. Likely on the NFCU card, the limit will be somewhat highish compared to what I'm used to getting. I want to run all my household bills (I'm not sure about how to do the mortgage) through the cards and PIF or at least <10-20% util.

My question is this: I see folks here who have a collection of insanely high credit limits. Tallied together anywhere between 50-150k. What do you do with all that credit? Don't the cc companies lower limits after awhile if you can't at least periodically use those cards? How do you balance all of it out? I personally am going to sit down with my budget and husband and look at our rewards catagories and tell him "always use this card for gas, this one for meals, this one for groceries" lol and I'll figure out the rest lol.

Re: What do you do with all your credit?

Anonymous — Thu, 08 Oct 2015 22:49:06 GMT

Even if I only got one rewards card or a set of rewards cards with a $6000 limit, I could literally run all my bills through and PIF and I'd be making money.

Re: What do you do with all your credit?

UncleB — Thu, 08 Oct 2015 23:03:07 GMT

@Anonymous wrote:
This is a completely honest question and I ask it purely out of curiosity. After our mortgage closes next week, we will have approx total of $6000 in monthly expenses. That's mortgage, car payments, student loans, utilitities, groceries, gas, child care, insurance, etc etc.

After we close, we are going to app for NFCU rewards, BofA, and a few other rewards cards. I only have 2 cards at the moment and the CL's are really low due to rebuilding.

So, just recently I PC'd by CapOne Plat to the QS1 and the last 2 months have been putting as many expenses through as I could to get the 1.5% until I hit the limit of $750, PIF and do it again.

From reading here, we have a very high chance of getting a decent limit on just the NFCU card, not to mention the others I will app for and will likely get a few. We made pretty good salary. Likely on the NFCU card, the limit will be somewhat highish compared to what I'm used to getting. I want to run all my household bills (I'm not sure about how to do the mortgage) through the cards and PIF or at least <10-20% util.

My question is this: I see folks here who have a collection of insanely high credit limits. Tallied together anywhere between 50-150k. What do you do with all that credit? Don't the cc companies lower limits after awhile if you can't at least periodically use those cards? How do you balance all of it out? I personally am going to sit down with my budget and husband and look at our rewards catagories and tell him "always use this card for gas, this one for meals, this one for groceries" lol and I'll figure out the rest lol.

That's an excellent question!

It's really different for everybody, so I don't want to make a 'general' statement, but I can tell you what I do.

Each of my cards has a purpose; basically it has to "earn" it's place in my wallet. I do exactly what you say you're going to work out with your husband... I know what card to use for each purchase to maximize my cash rewards. Some folks collect points or 'miles', but I prefer straight "cash", it just works better for me. The points (MR points on Amex cards and UR points on Chase cards) tend to work out well for folks who travel often, or like to redeem their points for lucrative gift cards. There's no right or wrong on this part... just do what works best for you.

I am currently saving my cash rewards to get a new laptop. At my current rate, I should be on schedule to get a really nice one next summer, and that's if I don't get any new account bonuses (which is always a temptation... LOL)

As for the really 'huge' credit lines, well, that too is a 'personal perference' thing. While there are a few folks who truly have a need for giant credit lines, some folks just like to see how 'high' they can go, similar to seeing how many cards they can 'collect'. My own spending is rather modest, and my current credit lines are more than sufficient for my current needs, including allowing for 'padding' for utilization. My 'sweet spot' for credit lines is $5k on the low end, and $10k-$15k on the high end. Realistically, there's no way I would spend that much in a month, but it's helpful to have that 'pad' I mentioned above for those times I do carry a balance. Since your credit score is said to be based on overall utilization, you can use available credit on one card to make up for another card that doesn't have as much available credit, at least for scoring purposes.

Even my high APR cards have their virtues; my Sam's Club MasterCard has an outrageous 22.9%, but it give 5% cash back for gas, 3% for travel and restaurants, so as long as you PIF you can do quite well. I also have a Care Credit account, with a breath-taking 26.99% APR (!). I recently used it for some dental work, but if I pay it off in 24 months I will pay no interest at all... which is a really good deal. It's all about knowing how to 'work' the system, so to speak!

Congratulations on your new home, and good luck (and have fun!) building your credit card portfolio!

Re: What do you do with all your credit?

Anonymous — Thu, 08 Oct 2015 23:09:59 GMT

Thank you UncleB! That's exactly what I wanted to know. Just how everyone uses theirs and manages and maximizes their benefits. Just a year back I traveled exclusively for my job but even though I spent 90% of my time on airplanes and in hotels I had to use the company AMEX so even having my own travel card back then wouldn't have really been helpful. Now I try to travel once or twice a year just to keep my status...Diamond with Hilton and Platinum with AA. I may want to add one travel card to my portfolio just for that purpose. But, like you, am more interested in cash! LOL Thanks for sharing!

Re: What do you do with all your credit?

Anonymous — Thu, 08 Oct 2015 23:10:55 GMT

@Anonymous wrote:
This is a completely honest question and I ask it purely out of curiosity. After our mortgage closes next week, we will have approx total of $6000 in monthly expenses. That's mortgage, car payments, student loans, utilitities, groceries, gas, child care, insurance, etc etc.

After we close, we are going to app for NFCU rewards, BofA, and a few other rewards cards. I only have 2 cards at the moment and the CL's are really low due to rebuilding.

So, just recently I PC'd by CapOne Plat to the QS1 and the last 2 months have been putting as many expenses through as I could to get the 1.5% until I hit the limit of $750, PIF and do it again.

From reading here, we have a very high chance of getting a decent limit on just the NFCU card, not to mention the others I will app for and will likely get a few. We made pretty good salary. Likely on the NFCU card, the limit will be somewhat highish compared to what I'm used to getting. I want to run all my household bills (I'm not sure about how to do the mortgage) through the cards and PIF or at least <10-20% util.

My question is this: I see folks here who have a collection of insanely high credit limits. Tallied together anywhere between 50-150k. What do you do with all that credit? Don't the cc companies lower limits after awhile if you can't at least periodically use those cards? How do you balance all of it out? I personally am going to sit down with my budget and husband and look at our rewards catagories and tell him "always use this card for gas, this one for meals, this one for groceries" lol and I'll figure out the rest lol.

I have about $500K in CC limits and I really don't do anything much with most of them. An issuer might cut a limit if it is unused, but that hasn't happened to me.

Unused credit can impact an issuer giving you a CLI ("You have used at most $1K of this $25K card, why should I give you more?") and other issuers extending credit ("There is a risk that you could max out your available credit, which is too high for your income, so I won't give you a card")

Store cards are more likely to reduce or close from non/insufficient use.

But the #1 rule is that you don't have to use the credit just because you have it, remember it needs to be repaid!

Re: What do you do with all your credit?

Anonymous — Thu, 08 Oct 2015 23:10:16 GMT

Asking around my friends and family now during this rebuilding, I'm only at $4500 credit, ALL of my closest only have 1-3 cards TOTAL. Limits from $2k-$30k. That's it. They think I've overdone it with 4 cards.

I think those on these forums are a credit minority with large limits and duplicate cards. Then again, this is from my small social circle.

2cents out!

Re: What do you do with all your credit?

Anonymous — Thu, 08 Oct 2015 23:12:59 GMT

@Anonymous wrote:
Asking around my friends and family now during this rebuilding, I'm only at $4500 credit, ALL of my closest only have 1-3 cards TOTAL. Limits from $2k-$30k. That's it. They think I've overdone it with 4 cards.

I think those on these forums are a credit minority with large limits and duplicate cards. Then again, this is from my small social circle.
2cents out!

LOLOLOL. Hey, my scores are similar to yours!

Re: What do you do with all your credit?

Anonymous — Thu, 08 Oct 2015 23:15:04 GMT

Longtimelurker, you said it! I'll be happy if I can grow them enough to cover all my expenses and may a little extra for an every now and again expense of a trip or something. But like I said, even if all I do is cover monthly expenses, I'm earning money with the rewards.

Re: What do you do with all your credit?

Anonymous — Thu, 08 Oct 2015 23:26:27 GMT

@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. What do you do with all that credit? Don't the cc companies lower limits after awhile if you can't at least periodically use those cards? How do you balance all of it out? I personally am going to sit down with my budget and husband and look at our rewards catagories and tell him "always use this card for gas, this one for meals, this one for groceries" lol and I'll figure out the rest lol.

Short history: Cards with Chase and Citi CLD'd in 2009/10, so decent limits before finding this place, but not what you see around here. We would usually be using our Freedom for everything, but for one reason or another sometimes we switched to TY Preferred, Amazon Visa, or (most recent before finding this place) AmEx TE. AmEx was the only one with limits that were auto CLI'ing. Everything else was stuck where it was from the days of CLD. We had a few other small-ish cards for BT purposes that we cycled through DP/Slate/Discover. I was vaguely aware of Freedom's categories but didn't super pursue them (because usually we were using it for everything. It had a $6600 limit and that was usually fine for two months of stuff. (Not pay to zero, but the type of PIF that 'normal' people outside of myfico do). We also had a $15k CU CC with a good-for-us rate of 14.5% that we'd occasionally have something on and pay over time. When the CU gave us a $15k limit to pay off some other cards, I KNOW That was the biggest limit I could have comprehended.

When I found myFico: First week or so, between DH and I $15k Discover, $15k BCP, $5k A+ and $5k SM. Discover to use as BT again (they'd been courting DH), A+ for non-cat spend and you get the rest. I WAS telling DH SM for Gas, BCP for groceries, Freedom for restuarants (I think that was the cat at the time), SM at Target, etc. etc. DH is NOT that kind of guy. He tried. He really, really did. Somewhere in there I got a couple hotel cards and decided I'd rather have cash back than the A+ restricted 2+% so general spend was switched to DC (I PC'd the DP, and took a HP to get a nice limit). About that time the categories probably rotated and I had to retrain him for that. I'd try not to get mad when he'd lose the post-it and/or just use the wrong card all-together for no apparent reason (because he used the right one the previous day and the next day). He wasn't happy. I wasn't happy.

Then he got an offer for the 100k AmEx Plat. He was jealous of my Ritz card (had learned by this time not to automatically make each other an AU on everything) and I started looking into MR. I had already decided there were things that made Barclay and Citi not my favorites. I like AmEx, Discover, and Chase. Since the 5/24 rule had come up there was no CSP in our futures so I decided to switch over as much as possible to MR. I got an EDP and PRG. He's an AU on the EDP. He got the Plat. I'd not considered the EDP previously because: a) I thought I'd never make the 30 swipes just using it for groceries or maybe groceries and gas, and b) I thought the bonus was only on the special cats. Once I realized it was really 1.5 on everything with more on gas and groceries, I decided that with the probable value of MRs being what they were, I could live with 1.5MR vs. 2x Cash for most things. AND, more importantly,this meant I could lighten up with DH. If he uses EDP for everything, I'm cool with that. I'll watch the $6k grocery limit and throw some on something else if I feel I need to. I'm using a few different cards when they're more advantageous (Discover with double cash deal on Apple Pay!, trying to hit $10k on the Ritz to keep Marriott status, etc.) I pay the bills so I move around the bills that take CC as I see fit. And I'm going to stop worrying about the odd-little cards staying opened, if they get closed, so be it.

So what I did with all that credit in April is different from what I did with it in July and is different from what I do now. It's a journey. I decided that I can keep at maximizing perks as a hobby as long as it's not adversely affecting DH who isn't into it.

We're not paying interest on anything besides mortgage, student loans and a car. But I know that stuff happens and not a bad idea to have a place to put stuff is something goes south as it did in 09/10. We're still paying off our kitchen reno from summer 2014 (all at 0%) and a few odds and ends that made their way onto 0% things (taxes). So my last new card (yesterday) was with DCU to get another low interest CU card as a 'just in case' (other CU card now down at 7.5% and this one is at 8.5%).

I can't see any other needs or wants besides potentially an airline card or two down the line. But I'd venture to say I'd close at least a couple to open anything new.

Congrats on the house!

Oh, and the things that don't go on cards for us: mortgage, cars, SL, natural gas bill, and property taxes. Everything else is good to go on cards.

Re: What do you do with all your credit?

Gmood1 — Thu, 08 Oct 2015 23:47:16 GMT

I use different cards depending on what I have planned to reap the most return in cash rewards or points. Right now I'm focused on points. So we use the Venture, Barclay WEMC(mortgage) and Chase Hyatt for most daily purchases including monthly recurring expenses. I use only Penfed Cash Rewards for my monthly gas expense. Once the points are met, I'll migrate back to Amex BCP for groceries/gas in better half's vehicle and QS for daycare, cell phone, utilites, etc.

I bounce the water bill, cellphone, internet, satellite and car insurance around the other cards periodically to show some spending. I also share my credit with my step daughter. I have her on my Amex BCP and SPG with preset limits. She uses them for her monthly spend and pays the bill. Got to teach them responsibiltiy early! lol

I have cards I haven't used in several months. Again as time goes on I'll spread the love around.

I'm most definitley a cash back kind of guy. We use the cash back on BCP to take care of oil changes and tire rotation/balances on both vehicles. It's just one less expense I let the credit card companies pay me for.

Re: What do you do with all your credit?

SpiceIslander — Fri, 09 Oct 2015 00:23:37 GMT

@UncleB wrote:
That's an excellent question!

It's really different for everybody, so I don't want to make a 'general' statement, but I can tell you what I do.

Each of my cards has a purpose; basically it has to "earn" it's place in my wallet. I do exactly what you say you're going to work out with your husband... I know what card to use for each purchase to maximize my cash rewards. Some folks collect points or 'miles', but I prefer straight "cash", it just works better for me. The points (MR points on Amex cards and UR points on Chase cards) tend to work out well for folks who travel often, or like to redeem their points for lucrative gift cards. There's no right or wrong on this part... just do what works best for you.

I am currently saving my cash rewards to get a new laptop. At my current rate, I should be on schedule to get a really nice one next summer, and that's if I don't get any new account bonuses (which is always a temptation... LOL)

As for the really 'huge' credit lines, well, that too is a 'personal perference' thing. While there are a few folks who truly have a need for giant credit lines, some folks just like to see how 'high' they can go, similar to seeing how many cards they can 'collect'. My own spending is rather modest, and my current credit lines are more than sufficient for my current needs, including allowing for 'padding' for utilization. My 'sweet spot' for credit lines is $5k on the low end, and $10k-$15k on the high end. Realistically, there's no way I would spend that much in a month, but it's helpful to have that 'pad' I mentioned above for those times I do carry a balance. Since your credit score is said to be based on overall utilization, you can use available credit on one card to make up for another card that doesn't have as much available credit, at least for scoring purposes.

Even my high APR cards have their virtues; my Sam's Club MasterCard has an outrageous 22.9%, but it give 5% cash back for gas, 3% for travel and restaurants, so as long as you PIF you can do quite well. I also have a Care Credit account, with a breath-taking 26.99% APR (!). I recently used it for some dental work, but if I pay it off in 24 months I will pay no interest at all... which is a really good deal. It's all about knowing how to 'work' the system, so to speak!

Congratulations on your new home, and good luck (and have fun!) building your credit card portfolio!

A big plus to Uncle B's post. I carry a balance on 4 of my accounts and continue to pay them off without further use. I use my other cards based on the rewards. However, I actually use every single account each month. My goal is at least 1% of the limit but the reward cards get the most luv! LOL! I have more credit than I need but I'm not complaining. If they're willing to give me CLIs, I'll take them.

Congrats on your new home!

Re: What do you do with all your credit?

Anonymous — Fri, 09 Oct 2015 01:34:32 GMT

Thank you everyone who has responded!

tourtisewins....my husband wants ONE card... BofA Dodgers MC 3-2-1 rewards. For the rewards? Nope. He's a huge dodgers fan. We get that and he can pretty much spend as he wishes without me telling him anything lol. *sigh* husbands

Re: What do you do with all your credit?

Anonymous — Fri, 09 Oct 2015 02:09:10 GMT

I don't have the enormous credit limits, but I do have a few cards. The store cards I use when I can get a better discount for using them. I haven't paid "full price" for clothing and household items for a long time now. As for my other cards, I use them like extended pay debit cards. For example, before I got my credit cards, I was a cash n carry kind of a girl. But life happens. In my case, I was out of state, heading home over a holiday weekend when an 18 wheeler decided he needed to be in my lane more than I did. I ran onto the shoulder, over some road debris Atlanta seems to have in abundance and did over $700 damage to the front suspension of my car. So add that to 2 days in a hotel, and being the first of the month, my rent, power, car note, insurance, and cell phone were all due. I paid EVERYTHING and ate peanut butter sandwiches and ramen noodles for a week until I got paid again. It would have been so much better if I could have thrown even one of my bills onto the credit card, and paid it over the next week or 2. I don't want huge limits. Just a couple of 5k limits would have me set.

I still cash n carry a lot anyway. I get points from my bank, and I don't like to put spend on my cards close to the statement date or while a payment is pending. I know it's crazy, but I just can't shake that habit.

Re: What do you do with all your credit?

OmarGB9 — Fri, 09 Oct 2015 02:53:10 GMT

For the most part I watch my limits just sit pretty lol. I have pretty much my yearly income in credit, and it's kind of crazy. There's no way I could pay down that much money if I ran them up. Also as other have stated, it's nice to have that UTIL cushion in case you need to carry a balance from time to time.

Re: What do you do with all your credit?

mitchblue — Fri, 09 Oct 2015 03:09:09 GMT

@OmarGB9 wrote:
For the most part I watch my limits just sit pretty lol. I have pretty much my yearly income in credit, and it's kind of crazy. There's no way I could pay down that much money if I ran them up. Also as other have stated, it's nice to have that UTIL cushion in case you need to carry a balance from time to time.

Similar. Ironically my pay, after taxes, is the exact number of my CL. I use all my cards, except the Green, and they all have their purpose. They're all in my wallet,except the Green. 6% or 1.5% is better than 0%. Thank you, credit.

Re: What do you do with all your credit?

Anonymous — Fri, 09 Oct 2015 03:22:01 GMT

Truthfully I dont need this much credit and I'll be letting two Amex cards go next week. Im about $3k under my annual income at the moment and only three - four cards are used regularly but they all served a purpose at one point or another so I dont regret any of the cards I currently have. But Im not into hanging on to what doesnt get used either. You have to keep in mind some people have high incomes and high monthly spend so larger limits might be necessary for them. Although I would have been fine with limits around $5k for general spend Im glad I have a couple higher limit cards bc I have a fairly large purchase (for me) coming up and in this case I needed a higher limit card. I think its unlikely Citi would have been comfortable granting me a $15k credit line if the rest of my cards were all under $5k at the time. Not saying it would have been impossible I just think its easier for a lender to grant a higher limit if they see you can handle it.

Re: What do you do with all your credit?

NRB525 — Fri, 09 Oct 2015 05:12:03 GMT

Up until mid-2014 I was working with 11 cards plus 2 closed cards, most of those paying down balances from back in the day.

As I've reached a tipping point in reducing balances, improving scores and thus being able to apply for new cards, the new cards all have some sort of sign up bonus, and some sort of earnings, and usually some direct link to a Frequent Flyer or Hotel Loyalty points program I am trying to maintain and build.

The legacy cards that I still have open are still important for their history and the relationship with each bank, and each bank is willing to keep giving me more cards, because of that good direct history, as well as their push to market the rewards cards that have annual fees.

I will have to close a few of these eventually, or downgrade to minimize/avoid annual fees, but for now I'm just enjoying the benefits of having the ability to app for cards I want, and getting instapprovals that seem to get better with each application.

As the overall balances go down, and the number of cards with spend requirements keep refreshing, several of the cards are having difficulty getting more than single digit dollar value charges in a month, but with how new they are, I don't expect any issues yet.

Re: What do you do with all your credit?

Anonymous — Fri, 09 Oct 2015 12:02:04 GMT

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?

Re: What do you do with all your credit?

deltatee — Fri, 09 Oct 2015 12:05:38 GMT

Interesting conversation, thanks for starting it @bmhill.

i am not someone who collects credit cards. I prefer to keep the number of cards to 4 or 5 so the cards have the chance to age and stick with me for a long time. As part of my long term hopes for each card I get, I have a pretty strict no AF rule. Even though your spending might support an AF card one year, spending patterns chang, and I don't want to be stuck with n AF that isn't earning its keep. I made that mistake with the Chase Mileage Plus card.

Basically, I run most of my spending through cards because it saves me from having to balance my checking account and worry about pending bills and large holds placed on the account as temp authorizations (like hotels). Also, I used to use my debit card for my spending until someone tried to buy thousands of dollars of fraudulent purchases with my account info. This shut down my bank account for a couple weeks while getting everything resolved. In my experience, credit cards have better fraud protection and are easier to dispute.,

so with that in mind, I use QS as my general spend card, and I supplement my spending with the higher categories on SM and Discover. As for my Amex, I only use it at Costco, I am not particularly upset by the new Costco arrangement and hope citi takes over and provides some decent rewards. Finally, my Amazon Visa is my oldest card, and always has 0% BT offers on it, so I use it for BTs mostly. Finally, I use Red Debit at Target and Kohls for the great offers you get there. I like having right around $10k on each card because some months it isn't hard to put nearly $1k on the card and with mid-cycle reporting, it is nice to not have to worry about a high utilization hit.

i don't have a desire to amass a massive ceedit limit but just enough that I can report a balance without taking a huge hit and can carry a balance if necessary without maxing myself out.

edit: autocorrect typos

Re: What do you do with all your credit?

baller4life — Fri, 09 Oct 2015 12:23:36 GMT

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!