CLIs: Pros and Cons

[Anonymous]

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@kdm31091 wrote:

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@Anonymous wrote:

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@RM21 wrote:
I think there are many pros when you aren't someone who has hit many internal limits of your lenders. I think once you get to that point, then things change a bit, as already mentioned.

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I am still unconvinced!, except in the very early stages of credit.   Let's say you go from $100K in total CL to $250K, without adding new cards (since we are talking about CLIs)   What are the many pros?   Yes, utilization can be reduced, but, if you can PIF anyway, you can push utilization (almost) as low as like anyway, any anyway most people don't need to maximize their score all the time.

And even if you subscribe to the "high limits cause other issuers to give high limits" meme, that would be a circular reason (I only need high limits if high limits are a good thing)

Now going from pretty unusable limits ($100 etc CLs) to better ones does make sense, as in the early stages of credit or rebuilding.   But at other points...

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I agree here. High limits are nice and all, but realistically, how much of them are you using at any given point? Certainly most people who have 150k in limits aren't using anywhere close to that. A cushion for utilization makes sense to some degree and we all want limits we can use for everyday spending, and maybe the occasional emergency, but other than that I don't see the big need/benefit for tons of huge limits.

It is a circular argument. Higher limits may beget higher limits if you subscribe to that, but then, if you have "good enough" limits, does it matter?

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And is there much of a difference between 1%, 5%, and 9% in UTL in regards to the effect on the credit score?

[irunfromcredit]

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@Anonymous wrote:

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@kdm31091 wrote:

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@Anonymous wrote:

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@RM21 wrote:
I think there are many pros when you aren't someone who has hit many internal limits of your lenders. I think once you get to that point, then things change a bit, as already mentioned.

---

I am still unconvinced!, except in the very early stages of credit.   Let's say you go from $100K in total CL to $250K, without adding new cards (since we are talking about CLIs)   What are the many pros?   Yes, utilization can be reduced, but, if you can PIF anyway, you can push utilization (almost) as low as like anyway, any anyway most people don't need to maximize their score all the time.

And even if you subscribe to the "high limits cause other issuers to give high limits" meme, that would be a circular reason (I only need high limits if high limits are a good thing)

Now going from pretty unusable limits ($100 etc CLs) to better ones does make sense, as in the early stages of credit or rebuilding.   But at other points...

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I agree here. High limits are nice and all, but realistically, how much of them are you using at any given point? Certainly most people who have 150k in limits aren't using anywhere close to that. A cushion for utilization makes sense to some degree and we all want limits we can use for everyday spending, and maybe the occasional emergency, but other than that I don't see the big need/benefit for tons of huge limits.

It is a circular argument. Higher limits may beget higher limits if you subscribe to that, but then, if you have "good enough" limits, does it matter?

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And is there much of a difference between 1%, 5%, and 9% in UTL in regards to the effect on the credit score?

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Yeah I wonder this as well.  I can say in my experience there is a difference when reported uti goes to 0.  The past 2-3 months, my scores fluctuate between 10-20 points when a balance reports versus when $0 balance reports.  

I hear anything under 9% is optimal for scoring though, I think???🤔

[kdm31091]

The other part of it is that even when your score is slightly changed due to utilization, the impact is temporary with no memory. There's no benefit to maximizing utilization month by month unless you feel it's going to make a difference for an application (and a few points are unlikely to matter much).Of course, you don't to be posting super high utilization, but other than that, manipulating it is more just something people enjoy doing vs something that is necessary IMO

[Gmood1]

Everything that I've read states 1 to 9% utilization for optimal scoring.
We can go round and round about why or should folks have certain limits. At the end of the day it's that individual's choice. There is no right or wrong. Do what works for YOU. If $2000 works for you that's fine. If $500,000 gets you by,that's fine to.

[irunfromcredit]

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@kdm31091 wrote:

The other part of it is that even when your score is slightly changed due to utilization, the impact is temporary with no memory. There's no benefit to maximizing utilization month by month unless you feel it's going to make a difference for an application (and a few points are unlikely to matter much).Of course, you don't to be posting super high utilization, but other than that, manipulating it is more just something people enjoy doing vs something that is necessary IMO

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I gave up trying to "optimize" my score and just let all my balances report and just PIF.  My scores fluctuate between 740-760, and in the big scheme of things I don't think it will make a major difference, especially since I am not seeking anything significant like a mortgage right now.

[Anonymous]

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@Gmood1 wrote:
Everything that I've read states 1 to 9% utilization for optimal scoring.
We can go round and round about why or should folks have certain limits. At the end of the day it's that individual's choice. There is no right or wrong. Do what works for YOU. If $2000 works for you that's fine. If $500,000 gets you by,that's fine to.

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I get that... just wanted to figure out my long-term credit strategy by hearing the different camps.

[Gmood1]

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@Anonymous wrote:

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@Gmood1 wrote:
Everything that I've read states 1 to 9% utilization for optimal scoring.
We can go round and round about why or should folks have certain limits. At the end of the day it's that individual's choice. There is no right or wrong. Do what works for YOU. If $2000 works for you that's fine. If $500,000 gets you by,that's fine to.

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I get that... just wanted to figure out my long-term credit strategy by hearing the different camps.

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I hear ya...base your long term strategy on your goals..not on ours.😉

[Anonymous]

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@Gmood1 wrote:

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@Anonymous wrote:

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@Gmood1 wrote:
Everything that I've read states 1 to 9% utilization for optimal scoring.
We can go round and round about why or should folks have certain limits. At the end of the day it's that individual's choice. There is no right or wrong. Do what works for YOU. If $2000 works for you that's fine. If $500,000 gets you by,that's fine to.

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I get that... just wanted to figure out my long-term credit strategy by hearing the different camps.

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I hear ya...base your long term strategy on your goals..not on ours.😉

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I will probably wait it out for auto-CLIs and request CLIs on my favorite cards as I get higher income in the next few years!

[Gmood1]

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@Anonymous wrote:

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@Gmood1 wrote:

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@Anonymous wrote:

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@Gmood1 wrote:
Everything that I've read states 1 to 9% utilization for optimal scoring.
We can go round and round about why or should folks have certain limits. At the end of the day it's that individual's choice. There is no right or wrong. Do what works for YOU. If $2000 works for you that's fine. If $500,000 gets you by,that's fine to.

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I get that... just wanted to figure out my long-term credit strategy by hearing the different camps.

---

I hear ya...base your long term strategy on your goals..not on ours.😉

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I will probably wait it out for auto-CLIs and request CLIs on my favorite cards as I get higher income in the next few years!

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Sounds good! What CC's do you have?

[Anonymous]

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@Gmood1 wrote:

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@Anonymous wrote:

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@Gmood1 wrote:

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@Anonymous wrote:

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@Gmood1 wrote:
Everything that I've read states 1 to 9% utilization for optimal scoring.
We can go round and round about why or should folks have certain limits. At the end of the day it's that individual's choice. There is no right or wrong. Do what works for YOU. If $2000 works for you that's fine. If $500,000 gets you by,that's fine to.

---

I get that... just wanted to figure out my long-term credit strategy by hearing the different camps.

---

I hear ya...base your long term strategy on your goals..not on ours.😉

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I will probably wait it out for auto-CLIs and request CLIs on my favorite cards as I get higher income in the next few years!

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Sounds good! What CC's do you have?

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USAA Rate Advantage - $4.5K

USAA Preferred Cash Visa Signature - $5K

Chase Amazon - $3K

Chase Freedom - $4.5K

Chase Freedom - $4.5K

AmEx Blue Cash Everyday - $10K

Discover It - $3K

Marvel MasterCard - $3K

I got 75% of those in the last 3 weeks... haha.  I am going to garden until June 2018...my credit scores went down 40 points.