But having a higher credit limit can also provide you greater flexibility financially, improve your credit score, and gear you up for emergencies if you use it wisely. Here’s a smart way to ask for a higher credit limit.
Understanding credit limit
Before asking for an increase, you need to know:
- Your current credit limit.
- Your average monthly spending.
- Your credit utilisation ratio of what you actually use of your credit.
You will usually find this on your card issuer’s monthly statement, website, or mobile app.
Why consider a higher credit limit?
Having a higher credit limit comes with several advantages:
Things to avoid
- Don’t ask for too many requests: It can be viewed unfavourably. And even then don’t overdo it, still try to stay under 30% of the limit.
- Overspending: When you increase your limit don’t do so just to be able to overspend, it should be a premeditated act not an emotionally driven one.
How to request to increase your credit limit?
To request an increase to your limit you can:
In conclusion, if managed prudently, a higher credit limit might enhance your credit situations and strengthen your financial situation. But it takes discipline, budgeting and common sense. Remembering requesting more credit limits is about managing credit, not about spending more.
Disclaimer: Mint has a tie-up with fin-techs for providing credit, you will need to share your information if you apply. These tie-ups do not influence our editorial content. This article only intends to educate and spread awareness about credit needs like loans, credit cards and credit score. Mint does not promote or encourage taking credit as it comes with a set of risks such as high interest rates, hidden charges, etc. We advise investors to discuss with certified experts before taking any credit.
