Your credit limit isn’t a guideline or a suggestion. It’s an absolute amount that you shouldn’t exceed. In fact, you shouldn’t be anywhere close to that amount.
But what if you are bumping up against your credit limit? This is a state of affairs that’s commonly called having a “maxed out credit card.”
When Is a Credit Card Maxed Out?
A maxed out credit card is when you’ve reached – or even tried to exceed – your credit limit. An example explains this pretty quickly.
Let’s say you have a $3,000 credit limit on your credit card. And your balance is $3,000. That’s maxing out your credit card. If you aren’t careful and miss a payment, your finance charges could push your balance beyond $3,000, which also creates new headaches, like fees. So, at the very least make your minimum payment and make it on time.
Listen, gazing at the balance of your maxed out credit card for the first time can be a terrible shock. I know because I’ve experienced that moment. It isn’t pretty.
But I survived…
