Is it a good thing that Amex increased my spending limit?

Question

I am 20 years old, and I have a couple different credit cards. I only use one of them, the Amex. My Amex credit card has a limit of over $18,000. I won't use half of this, though. American Express has automatically increased my spending limit, without my asking, 2 or 3 times within the last year. Is this a good thing? Does this mean I have good credit? I always pay on time, more than the minimum due.

I'm just curious why they did this without my request.

Answer 1

It means that you have an excellent record with them.

Answer 2

they should not do it without your authority. it's a good thing for them as they get more interest the more you spend.

Answer 3

They aren't increasing your limit because you are doing something right. They are increasing it because they want you to spend up to that limit so you will pay them back. The further you are in debt, the happier they are. They know that if you owe them money you will have to pay it back with interest. I suggest only having one credit card until you understand there is no real reason to have a credit card to begin with. Worried about building credit? You can build credit by paying your bills off ontime and not a credit card bill. Why spend the cash you don't really have?

Answer 4

it probably shows you have a good (or at least not a bad) credit limit and so Amex want you to borrow more from them  (and pay them more interest).  Just be careful you don't accidentally upgrade to a card that pays a larger annual fee (especially if you don't even intend to ever use the credit!)

Answer 5

Some credit card companies will check your credit quarterly or sometimes at other different intervals of time. Sometimes every couple years months and so on. If your credit is good they will increase your credit limit, consequently if it's bad they might lower it. Sometimes they give credit limit increases if you have been using good payment habits. None the less a higher credit limit looks better on your credit report. To see why and how they are checking your credit or doing limit reviews you can check the terms and agreements when you signed up for your credit card, or call customer service listed on the back of your card and find out how and when they do their credit limit reviews.

Answer 6

Yes it is a good thing. It means that you have a positive history with the company. Often they will automatically up your limit.