TCL in relation to income.

[mitchblue]

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@austinguy907 wrote:

The average person around here usually hits about 2.5X annual income in comparison to the general public.  There are some that go to the extreme and have TCL's between 500K-1M and there are others that like to keep things on the skinny and cap out at 30-50K.  Depends on your thoughts on credit though.

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What do you consider the average perso? 2.5 for the average person, that's not what I see on here..

[mitchblue]

I've turned down CLI before, I never went 3X with AMex, much lower, and when I closed my CSP I didn't transfer any to my Freedom Unlimited.. I also don't ask for CLI any longer.. I have more than enough and I hope I never exceed 100k. And I might try to lower to 80K..

[Anonymous]

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@digitek wrote:
I am of the small time camp, and try to keep mine low. Even requested a CL Decrease on my CSR. I am pretty conservative, I don't even like credit, just something I have to do. Can't imagine ever needing to borrow $400k at 20%!

My total CL is about 1/3rd of my income.

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@Anonymous do realize that being in the PIF club means you would never be borrowing 400k @ 20%, right? The only effect purposely handicapping your limits does is restrict your ability to make a large amount of purchases before paying the balance, given that you are in the PIF club. I'm not really sure how that is a helpful thing. 

[Anonymous]

I believe nearly anyone could afford one regardless of income.  Most affordable brand going.

[fltireguy]

🤣🤣🤣🤣

I coulda pissed in my pants from that one !!

[digitek]

Hi wandering,

I guess I should have said that I'm a mere mortal and could never charge more than $10k and PIF that month unless I was planning on it, and in the very small chance that I ever need to do that I could just request a CLI I guess, but still can't really see my self charging that much in a month.

The reason I keep the limits low is because I don't need it, I don't have to worry about insane CL's effecting my chance for credit in the future, and I don't even want to be tempted to carry that much debt with such an insane interest rate. It's a personal thing I guess, I do realize that I'm kind of handicapping myself 😁

[austinguy907]

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@mitchblue wrote:

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@austinguy907 wrote:

The average person around here usually hits about 2.5X annual income in comparison to the general public.  There are some that go to the extreme and have TCL's between 500K-1M and there are others that like to keep things on the skinny and cap out at 30-50K.  Depends on your thoughts on credit though.

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What do you consider the average perso? 2.5 for the average person, that's not what I see on here..

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When I say average I take into account that most of us that have grown/repaired our files to 750+ scores.  When starting out most are in the 5-20K range TCL and then go up from there.  I think some of the systems in place when considering new apps will cap most at 2.5X their reported income when applying in comparison to their other accounts.  Some are known to be a bit more stingy and responsible like a couple of CU's and Chase that do a quick DTI when assigning a SL or evaluating someone for a CLI.  

There's always an extreme on either end of the spectrum to $250 CL up to a Million plus depending on how long someone's been playing the game.  When you figure out the rules and have the tactics you can pick up around here anything is possible when it comes to getting credit. Once you get to a certain point it's not hard to pick up $50K in additional CL's in a weekend app for a couple of cards.  

I guess if you look in other sub forums other than the 3 CC forums you can find some other numbers that are higher or lower depending on the classification of info being reported.  The numbers I've been seeing though are strictly revolving credit and not taking into account auto/home/biz lines.

[austinguy907]

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@digitek wrote:
Hi wandering,

I guess I should have said that I'm a mere mortal and could never charge more than $10k and PIF that month unless I was planning on it, and in the very small chance that I ever need to do that I could just request a CLI I guess, but still can't really see my self charging that much in a month.

The reason I keep the limits low is because I don't need it, I don't have to worry about insane CL's effecting my chance for credit in the future, and I don't even want to be tempted to carry that much debt with such an insane interest rate. It's a personal thing I guess, I do realize that I'm kind of handicapping myself 😁

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I can see some flaws in this approach but, if you don't own real estate it could be fine.

Having available credit is a positive and useful scenario if something comes up like a roof replacement (10K+) or HVAC goes out ($5-10K+).  Having the ability to use a current card with a low fixed APR of say 5% is kind of nice instead of pulling 10K out of thin air to cover the expense.  If you own you can also delay some payments with the CC float like paying your property taxes ($5-10K) and using the CC leverage to delay it coming out of your checking account right away.

We never plan for huge expenses in a given month but, being able to soften the blow with a good CL on your CC helps while you figure out where you ultimately want to put it or pick up a new CC with 0% that's got a decent SL that won't impact your ability to maintain your scores in the process.

I guess everything all comes down to perspective.  I like knowing I have options if a disaster hit and I needed to rent a car for a month along with a hotel and not have to worry about the expenses throwing off my ratios / scores.  Sure there's insurance but, delays due to large impact areas could be detrimental and you can always go for reimbursement within 30 days for the incurred expenses due to the loss. 

[taekwon]

I agree, always plan for the unforeseen/unexpected. It will be a lot less stressful if/when it does happen.

[Revelate]

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@Anonymous wrote:

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@digitek wrote:
I am of the small time camp, and try to keep mine low. Even requested a CL Decrease on my CSR. I am pretty conservative, I don't even like credit, just something I have to do. Can't imagine ever needing to borrow $400k at 20%!

My total CL is about 1/3rd of my income.

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@Anonymous do realize that being in the PIF club means you would never be borrowing 400k @ 20%, right? The only effect purposely handicapping your limits does is restrict your ability to make a large amount of purchases before paying the balance, given that you are in the PIF club. I'm not really sure how that is a helpful thing. 

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How large a purchase are we talking about?  Generally speaking most large purchases I can think of rarely go on a credit card from an optimal financing perspective?