MO’ CREDIT

I received a letter from my bank in the mail a few days ago. The letter was informing me that my bank was willing to increase the credit limit on Visa card by $2,500 which would bring that number to five-figures. I didn’t request an increase so my bank is doing this on its own.

This isn’t the first time they’ve just randomly decided to give me a credit increase. Banks really don’t do things for you unless it ultimately makes more money for them. Since I pay off my Visa bill completely every month (and have done so since about 2005), my bank makes no money off me. I don’t pay any interest at all. I believe this credit increase is another ploy to change my spending habits so that I get into a situation where I start carrying a Visa balance from month to month. Perhaps with a higher limit I might start thinking about a bigger vacation or more expensive purchases.

Of course, there is one actual benefit to having a higher limit and that’s the peace of mind knowing you can afford to handle a significant financial emergency if one were to happen. I’ve also heard this might be beneficial to your credit score if you don’t change your spending habits. Essentially, you have more credit at your disposal but since you’re spending the same amount, that looks better on your credit report.

The onus is on me to agree to this increase but I think I’ll probably go ahead with it. As long as I don’t go on a crazy shopping spree, this is beneficial to me in the long run.

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