| Once solely restricted to the wealthy, now | | | | credit score instantly. Secondly, future |
| almost any one can obtain a credit card | | | | creditors also consider your debt to income |
| including the most favored, first year | | | | ratio when deciding whether to extend |
| college students. It's no wonder then that | | | | additional credit to you. Ideally you want |
| U.S. consumer credit card debt stood at over | | | | this to be as low as possible considering you |
| $735 billion in 2003 which further breaks | | | | never know when you might need additional |
| down to approximately $12,000 per household | | | | credit. A debt to income ratio of 36% or |
| for those who elected to carry balances from | | | | less is most favorable.So what is the ideal |
| month to month. While the advertisements of | | | | balance for someone with a credit limit of |
| the Visas and MasterCards of the world | | | | $3,000? Ideally, potential creditors only |
| continue to tout the convenience and ease at | | | | like to see 25% of your total available |
| which you can shop or handle an emergency | | | | credit outstanding at any given time. So, |
| with just a swipe of the plastic, they fail | | | | with a $3,000 limit you should only carry a |
| to mention how you as a consumer should use | | | | balance of approximately $750. I'm not |
| your card including guidelines as to how much | | | | saying you can't purchase more than $750 |
| credit limit is too much and how to keep from | | | | worth of items at any one time, what I am |
| ruining your credit rating by constantly | | | | saying is that if you must make major |
| maxing out your credit card. The purpose of | | | | purchases you should commit to paying |
| this article is to provide you with some | | | | significant amounts of money each month to |
| insight in these two areas.When you apply for | | | | bring your balance back down to this more |
| a credit card, one of the first things you | | | | reasonable level before charging again.Credit |
| consider is the credit limit. Why? Because | | | | cards, when used wisely, can be one of the |
| that determines how much you can spend, and | | | | most efficient and empowering tools in your |
| the rule of thumb is the higher the limit the | | | | wallet. They give you the opportunity to |
| better. But wait a minute, just because your | | | | take advantage of deals and discounts at the |
| limit is $3,000 doesn't mean that you should | | | | drop of a dime whether you have the money or |
| keep spending until it's gone. Why? There | | | | not. Not over looking all of these |
| are two simple reasons why you should not | | | | wonderful advantages, we should really think |
| spend until your card has reached the limit. | | | | about how we use these plastic jewels keeping |
| The first reason being that the higher your | | | | in mind that it never looks favorable to |
| outstanding balance the higher your minimum | | | | future creditors to view a credit report of |
| monthly payment. Once your card reaches the | | | | an individual whose accounts are at or near |
| limit unless you start to pay a significantly | | | | max. In fact 25% of the approved credit |
| higher monthly payment to get it down, the | | | | limit is generally the rule of thumb for the |
| interest charges and over-the-limit fees will | | | | outstanding balance that you carry forward |
| begin to kick in which will cause someone who | | | | from month to month. By keeping this in mind |
| is living beyond their means to become | | | | as you go about your day-to-day purchases, |
| overwhelmed very quickly. Even worse if you | | | | you can ensure that you do not negatively |
| have more than one card that is at the limit, | | | | impact your credit score or prevent your self |
| you are playing a dangerous game because any | | | | from being able to obtain new credit.This |
| major disruption in employment or income that | | | | article has been provided courtesy of |
| you can't supplement with personal savings or | | | | Creditor Web. |
| credit insurance will negatively affect your | | | | |