bada_bing wrote:There are several memes that are common here at MyFICO that don't make much
logical sense (at least to me).
One is the quest to grow limits beyond their utility.
A lot of the justification seems to center
around the idea - at least subconsciously - that a credit limit is an asset - something you own
that has value because it is denominated in dollars.
But you don't "own it", it is granted at the
whims of credit issuer and it doesn't have value in the strictest sense because to use it you
trade debt for the charge. A credit limit is a tool that allows you to more efficiently use the financial
power you have, it is not financial power ($$$) in itself.
Another is the idea that managing utilization monthly/weekly/daily all the time is important,
and by extension, big limits are useful to reduce utilization percentages. Utilization and a
FICO score in general is like Schrödinger's cat, in that it only matters when someone is
looking at it.
There is a difference between maintaining personal finances in good shape -
which will keep a FICO score up although that isn't the point of good personal finances - and
tweaking transient things like utilization to juice a score when there are no apps planned. A
high FICO score definitely has value but it seems strange that it is a point of vanity for some.
Of course, I'm not immune to any of my criticisms above. My lowest CL is $10K and I have a
couple at $50K. My FICO8 is 850 and I look at it a couple times a month admiringly, although
I haven't showed to any prospective lenders in over 2 years (made an application).
+1
This post is very much on point.
We, humans, get lost in the simple sauce.....
We oversimplify and obess on the BIG, fat, and easy to SEE.
Whether it's cars, houses, breast or anything we 'feel' is objective ...when really most things are subjective
based upon ones needs, likes, wants and desires....at said time and space.
Of course one can grow CL's way beyond one's reasonable utility (How many ppl NEED a gazillion dollar CL at Lowe's..outside of 'maybe', just after a new home purchase?) however the vanity and mental mind game that can be 'sold'/puffed into a client's head is priceless towards 'buying' loyalty and purchasing behaviour.
Gas efficent cars never had a chance of being the norm ...if SUV's can exist ....c'mon how many ppl NEED a sports utility vehicle let alone even KNOW what the initials even stand for (btw which SPORT are we talkin anyway) it's about BIGGER = better.
The logic of the 'why' goes out the window.....we 'chase' bigger b/c we're SUPPOSED to...
Of course this is 'to a certain degree'...the issue is WHEN is enough, enough
For many once we're 'on a track'....everything becomes THE TRACK
Think of folks that are 'pro' this or that
Most ppl in this country are at least somewhat religious but we all know folks that just can't STOP and go on and on....
Same thing with eating and being 'healthy'......who doesn't want to be healthy...but let's be honest
The guy that carries water, tuna and a calorie counter, who lectures about the ills of a freaking Big Mac is a bit MUCH
Or the 'safety' Mom who's kid will melt at the sign of DIRT on her kid's hands from the park.....
Many times the over obsession with one's exact utilization AT ALL TIMES is overkill....as the above poster alludes to
we ain't applying for mortgages EVERY month
we don't need the BEST foot forward b/c of a car loan each day we wake up
The same way MOST days in our lives we CAN eat a freaking Big Mac w/o dying (nobody is trying to fit in "that dress" EVERY month)
the point of knowing this stuff and paying 'somewhat' attention to it, is to enjoy LIFE.
And UNDERSTAND how/why not to get way out of whack but other than
a) rebuild mode
b) 1st build mode
c) active app prep mode
it's ok to 'chill out' with the CHASING
* Granted there will ALWAYS be outliers
Ppl that not only like sci fi but actually dress up as characters
Ppl that not only enjoy action moives but dress up as Wolverine
It's ok just to be a very well informed 'watcher' w/o visting the costume store folks