We’ve got a big mystery to solve over here. 🕵️ Our credit card keeps getting declined and we have no idea why. The reason: whenever we check our account, it says our balance is outstanding! 🤩
Worried you’ll max out your credit cards? 🥴 Having a high enough credit limit could help ease your fears. Let’s look at how to figure out what works best for you. 👇
Here’s Five Fast Facts on credit limits:
- 💳 Where Credit’s Due - A person’s credit limit is the maximum amount they can borrow on a credit card or loan account. It’s primarily based on overall credit history, ability to pay, and income. The more credit you have and don’t use, the healthier your credit score.
- 📈 High Times - How much credit you should have all depends on your own personal financial situation and spending habits. In general, experts say you should aim for a credit limit that’s significantly above what you plan on spending each month.
- 🍦 The Sweet Spot - Credit rule of thumb: try to use between 10% and 30% of your credit limit to keep the credit score gods happy. When you use more than that, you might be seen as a risk to lenders.
- 💵 Back to Basics - If you don’t have the best relationship with credit, don’t feel like you have to shoot for the moon. To start, aim for a credit limit that’s just a little above and beyond what covers your essential needs. You can build up over time.
- 📞 Gimme Gimme More - How do you boost your credit limit? Try contacting your credit card company for a limit increase or open a brand new card or line of credit. Pro tip: when applying, check if there’s a hard or soft inquiry. A hard inquiry will likely bring down your credit score, but it’s temporary.
🔥Bottom line: Credit is a hot topic in today’s economy. No matter how high or low your limit is, try your best to stay in bounds. Working on a financial glow up in 2026? We’ve got a bunch of wealth building strategies for you. Check out this article for all the details.
Do you know your ideal credit limit?
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