Many credit card consumers do not think about or care about maximizing their available credit.  This is generally due to not receiving monthly credit card limit increases that have been mailed to their accounts.

Consumers may not realize how much money they are spending and unnecessarily racking up debt until their credit cards become maxed out, at which time they realize how much money they have spent and are thinking about how to make payments and how to reestablish their credit.  It’s at this time that they realize credit limit increases have been handled contrary to their wish, and may be receiving less than the actual credit limit increases that they are seeking.

Now don’t get me wrong, credit card providers are not out to lose your business.  What they want to gain is your business and it is at this time they become greedy.  Credit limit increases alert many people to wise spending and re-establishing their credit after you have established your good financial habits. Credit limit increase credit cards utilized appropriately.  However great this as an inexpensive way to re-establish your credit, credit card companies aren’t doing their best to be fair to their customers.  Beware of over-hype from credit card companies since these companies are out to gain you as a customer and will use any means necessary to get you spending, reestablishing your credit, even with their generous credit limit increases.

Here are some things to consider when you are researching credit cards:

1. What is your APR?

This is the interest you will pay on your purchases, payoffs, and transferred balances.  Do you pay the interest or do you pay only the minimum amount each month?

2.How long is your grace period?

Your grace period is the time you have to pay back appearing on your monthly statement before interest is charged. Many people do not realize that grace periods are steadily increasing and your interest charges will be much higher if you pay your accounts with less than one month’s grace period.

3.How many cards does someone need?

Most card companies, after you have applied, will send out application request forms that ask if you plan on having  additional cards or if you wish to close your accounts.  Meaning that you are planning on getting another card and need to close your account with them.

4.How does the credit card company determine your credit limit?

All credit card companies do not perform the same way of determining a credit limit. The way they determine your credit limit will vary from one creditor to the next.  Further, the limit may be determined by where you live or by your credit rating.  If you have established, maintain and have good credit, a credit card company may increase your credit limit. If you have a poor credit rating or no credit rating, and your cards are limited to your credit limit, your interest rate will go up to the maximum allowed.  Avoid asking the credit card company to increase your credit limit if you have a low score or no credit rating since you should be able to get the maximum limit raised without just increasing your score or putting additional credit on your credit report.

5.What are the finance charges?

These charges are what account for the monthly credit card payments, but you never know what the interest rate is on a credit account.  Companies can charge anywhere from 3 to 21 percent on a credit card balance.  If you happen to do not pay the balance before the due date, which will normally be the 20th, then you will pay an additional interest for one month.  If this payment is not made, the credit card company will charge interest.  Hence, make an agreement to fully pay on date or have the amount automatically deducted from your checking or savings account on the 20th of every month.

These tips, along with searching for a credit card with a lower interest rate and a rewards program that fits your spending habits, your lifestyle and your budget, will help you maximize your benefits in order to stay within your means.  Do what you can to make more money by letting the credit card companies know if your credit limit will be increased by them.  Contact your credit card company and ask for an explanation of your account.  Next time, after you receive your next credit card, look into the different rewards program and find a card that fits your lifestyle and your spending habits.