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value of having high credit limits and other reasons

fritscher
Regular Contributor

value of having high credit limits and other reasons

Hi

i am relatively new here..I do see that many people like to keep increasing their credit limits on their cards..I am wanted to do that too but i know I would never use those high limits..Is the reason why to have low util for the most part or do many of you actually charge 15000 a month and pay off?  also in order to get about 15000 do you have to have very high income.? just some thoughs..I have the urge to do cli on my current cards just to see if that will make my credit scores go up more etc

thank you for feedback

Message 1 of 24
23 REPLIES 23
SouthJamaica
Super Contributor

Re: value of having high credit limits and other reasons


@fritscher wrote:

Hi

i am relatively new here..I do see that many people like to keep increasing their credit limits on their cards..I am wanted to do that too but i know I would never use those high limits..Is the reason why to have low util for the most part or do many of you actually charge 15000 a month and pay off?  also in order to get about 15000 do you have to have very high income.? just some thoughs..I have the urge to do cli on my current cards just to see if that will make my credit scores go up more etc

thank you for feedback


Yes, it makes it easier to keep your utilization percentage low.


Total revolving limits 677500 (584500 reporting) FICO 8: EQ 758 TU 777 EX 749

Message 2 of 24
CreditContractor
Established Contributor

Re: value of having high credit limits and other reasons

Generally speaking, if you have had great credit your whole life you should have high limit credit cards by the time you are middle aged. 

Message 3 of 24
SeveredFinger
Frequent Contributor

Re: value of having high credit limits and other reasons

Spot on for me as well.  Making up for lost time, never having learned those lessons earlier in life. 

For me it's about keeping util low and scores high, and having an available reserve in case something goes wrong, unexpected repairs, etc.

 

Also, I follow auctions sometimes, and I've missed a few really lucrative deals because I couldn't swing $1500 or so on a temporary basis, when the deals would have netted me $3-4K on the turnaround.  Now I don't miss those deals.

Message 4 of 24
mjb59463
Regular Contributor

Re: value of having high credit limits and other reasons

 

Between my cards, I have more credit than I would ever feel comfortable using even 20% of. On the chance I would need to carry a balance for a short while now, my higher limits would definitely help cushion the UTIL blow. 

 

But in my case, higher limits have been a double-edged sword. In the past, I used credit irresponsbly simply because it was available to me, and landed myself in a world of hurt with CC debt. I've since learned from that mistake, and managed to get out without any late payments, AA from lenders or derogs. That was pure luck, and I never want to be back there again. 

 

 

I've never requested a CLI, all of mine have been automatically done on the lenders side. That's the way I plan to let it proceed from here on out. 

Scores: 790 TU (Barclay), 780 EX (Fico8), 790 EQ

Chase Freedom Unlimited (6k), CSP (20k), Amex Delta Platinum (13.5k), Amex Marriott Bonvoy (16k), Barclay Apple (12.5k), USBank Flexperks Travel Rewards (12k), Wells Fargo Visa Signature (10k), Citi Double Cash (8k), Amex Gold, Amex Platinum, Amex BBP (15k) Marriott Bonvoy Boundless (15k)
Message 5 of 24
Anonymous
Not applicable

Re: value of having high credit limits and other reasons

To answer your question OP, do you have to have a high income to obtain high limit cards my answer would be NO. 

 

There are plenty of forum members here that have single credit lines that are 50% of their income or even higher, as well as others that have combined total credit limits that are several times their reported income... say 2-3X.  There are a few outliers with credit limits that total 4-5X their income.

Message 6 of 24
TheVig
Regular Contributor

Re: value of having high credit limits and other reasons

Higher limits, beget higher limits.
Message 7 of 24
Chris679
Established Contributor

Re: value of having high credit limits and other reasons


@fritscher wrote:

Hi

i am relatively new here..I do see that many people like to keep increasing their credit limits on their cards..I am wanted to do that too but i know I would never use those high limits..Is the reason why to have low util for the most part or do many of you actually charge 15000 a month and pay off?  also in order to get about 15000 do you have to have very high income.? just some thoughs..I have the urge to do cli on my current cards just to see if that will make my credit scores go up more etc

thank you for feedback


Some reasons to have high credit limits (in no particular order):

 

Help pad utilization

Asking for CLI is fun and some do that rather than apply for new cards (scratch the itch so to speak)

Vanity

Actually need the higher limit to make larger purchases or to not have to make multiple payments per month

It is my opinion that higher limits can lead to higher SL for other new accounts

Larger purchase power or cash advance in case of emergency 

Message 8 of 24
Backwoods
Senior Contributor

Re: value of having high credit limits and other reasons

Income sometimes brings high credit limits also having other high limit cards. . My DW is listed as the owner of our business.  The business does very well.   One of our cards is the Biz Spark card (reports on her credit)  with over a $10K limit. What we have found is several banks have tried to match her credit limits or better them.  That being said new cards after our Spark  always come in over $10K for her and she gets $5K credit increases like candy without asking. I am at the point of locking her purse inthe office safe.   We really dont want  any more CLI on her cards.   I on the other hand am the "office person."  All my limits are more normal.  I fight tooth and nail for cli. DW %  use because of the total limit remains very low typically 1- 2 %. This drives score even higher and gets her even bigger limits. For our zip code our income and net worth are both above average.  We do PIF every month so unless I want a home makeover the cl don't help us.  

Message 9 of 24
newhis
Valued Contributor

Re: value of having high credit limits and other reasons


@fritscher wrote:

Hi

i am relatively new here..I do see that many people like to keep increasing their credit limits on their cards..I am wanted to do that too but i know I would never use those high limits..Is the reason why to have low util for the most part or do many of you actually charge 15000 a month and pay off?  also in order to get about 15000 do you have to have very high income.? just some thoughs..I have the urge to do cli on my current cards just to see if that will make my credit scores go up more etc

thank you for feedback


Not at all. My Discover card is over 60% my reported income. I have 3 Chase cards that total 55% reported income.

 

I'll say it is not hard, but it takes time, to get a 15,000 card with 30,000 income. Easier and faster if your income is higher.

 

Higher limits will not increase your score unless they help your util. There are people with few cards and low limits with high score just by paying down the card and letting report a small balance.

Message 10 of 24
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