“Sorry, the credit card is over limit.” Looks like it’s the standard sentence spoken by the cashier after failing repeatedly to swipe the credit card at the EDC machine during the transaction. When it is over limit, practically the credit card becomes ‘junk’. He can’t be used at all until the bills are paid first.
Credit card limit of debt at a time
Yes credit card limit is the upper limit of debt at a time, usually per month. Or in other words, the credit card always has the maximum number of transactions that can be used. The amount itself depends on the type of credit card, silver, gold, or platinum.
So if the limit is USD. 10 million and the accumulated transactions reach USD. 9.9 million, then if you want to swipe up to USD. 1 million, there will be two consequences. First, there are some credit cards that still allow but with a record of being subject to overlimit fees. Second, the transaction can be rejected immediately.
In short, the limit seems to be the most important sign in using a credit card. Reckless transactions to overlimit will incur more costs because of the imposition of fines.
Worse yet if the credit card is used to pay off routine bills such as PLN, PDAM, pay TV and so forth. When it’s overlimit, it’s practically going to reap problems because the bill failed to pay or incur costs.
Then is the credit card limit a fixed price? Of course not. The credit card limit is dynamic.
If you have had enough with the current limit, of course there is no problem. Another case if it is considered too small then it needs the option to increase the credit card limit from the current one.
That is, no need to worry if the credit card limit is now too small. There is still an opportunity to negotiate with the credit card issuing bank so that the limit is revised. Well, about what are the strong reasons for raising the credit card limit?
1. More and more regular bills are paid via credit card
Try to calculate how many monthly bills that must be completed each month? For example, electricity bills, PDAM, pay TV subscriptions, internet, telephone, and others. All bills that accumulate can be resolved via credit cards. Let the credit card complete all the bills.
That’s how many routine bills must be paid.
Now, if you feel more and more routine bill lists that themselves make the amount swell and can not be overcome with a credit card limit now, then it’s time to think about raising the credit card limit.
In addition, cook has a credit card only used to pay monthly bills?
2. Need a reserve fund for emergencies
This reserve or emergency fund is important. Good Lender financial planning experts have reminded that the amount of the reserve or emergency fund is worth 10 times the monthly living expenses. So when the monthly living costs reach USD 7 million per month, then ideally the emergency fund is USD 70 million.
Well, the need for emergency funds can be overcome through credit cards. The amount of the credit card limit can be adjusted to the needs of emergency funds. So there is no need for the option to sell assets such as cars, gold, or even pawn a house certificate when you need sudden money.
3.Standard life changes lives
The standard of living usually follows his income. Not the other way around!
Once income rises, it will indirectly change someone’s standard of living. If he initially paid USD 10 million and then rose to USD 15 million, his lifestyle would certainly change. When initially there was no budget for ngegym, but when salaries went up, it could be that every month there were expenses for body work.
Higher incomes are usually followed by lifestyle changes
4. As business capital
For some people, credit cards can be a business capital. For example, buying merchandise with a credit card first and then selling it again. When business is getting smoother and demanding to purchase goods in large quantities, then increasing credit card limits can be considered here.
In the context here, a large credit card limit can fall into productive debt. Of course, it will be taken into account that business results can cover credit card bills on time. If you miss it, you will have problems. In addition to being hit by high interest rates, there are also late fees.
5. Frequent traveling abroad
Shopping with a credit card when traveling is more practical than carrying cash. Cash is actually troublesome because it must first be exchanged for local currency. It’s the same with a credit card that just swipes.
In addition, credit cards also help pay off traveling expenses such as airplane tickets, accommodation, transportation, and so on. In addition, credit card holders also expect the limit to be enlarged further so that they are free to shop while traveling. It’s okay if you don’t take a credit card with you on a walk.
At least five points above can be a compelling reason to revise the existing credit card limits. Different cases if the reason is to satisfy a consumptive lifestyle. Remember, that credit card really supports consumptive life because it is an instrument for creating debt.
Or even the option to increase the limit is also not the only way to make credit cards more powerful. There are other safe ways, for example by increasing credit card balances by transferring a number of funds to a credit card.
For example, the credit card limit is USD. 15 million. While monthly transaction needs reach USD 18 million per month. Now, we can transfer USD 3 million to a credit card so that the monthly transaction is sufficient. Just keep in mind whether this method is still subject to overlimit fines. If you get fined, you should ask for the limit to be enlarged.