Is a 2,500 Credit Limit Good? (2024)

FAQs

Is a $2500 credit limit good? ›

Chip Lupo, Credit Card Writer

a $2,500 credit limit is good if you have fair, limited or bad credit, as cards in those categories have low minimum limits.

You should use less than 30% of a $2,500 credit card limit each month in order to avoid damage to your credit score. Having a balance of $750 or less when your monthly statement closes will show that you are responsible about keeping your credit utilization low.

If you're just starting out, a good credit limit for your first card might be around $1,000. If you have built up a solid credit history, a steady income and a good credit score, your credit limit may increase to $5,000 or $10,000 or more — plenty of credit to ensure you can purchase big ticket items.

What is a good credit utilization ratio? The Consumer Financial Protection Bureau (CFPB) recommends keeping your credit utilization ratio below 30%. So, if your only line of credit is a credit card with a $2,000 limit, that would mean keeping your balance below $600.

In 2022, Generation Z (ages 18-25) averaged a total credit limit of $11,290 across all credit accounts, far lowest among the five generations presented. Baby Boomers top the list with a $40,318 total credit limit on average.

If you can pay $100 a month, it might take you 25 months to pay off the debt. If the card has the same APR but an annual fee of $100, it might take 29 months. And if you can pay $300 a month for a 20% APR card with a $100 annual fee, it might take you 8 months to pay off $2,000.

It is far easier to get a $2,500 personal loan with bad credit than it is to get one for a larger amount. Usually, you'll need a credit score that's around 550 to 650 to qualify, though you should expect to pay higher interest rates with a credit score this low.

To maintain a healthy credit score, it's important to keep your credit utilization rate (CUR) low. The general rule of thumb has been that you don't want your CUR to exceed 30%, but increasingly financial experts are recommending that you don't want to go above 10% if you really want an excellent credit score.

To figure out your DTI, simply divide your total monthly debt by your gross monthly income—the lower your percentage, the better. Many lenders prefer a DTI below 36%. A lower DTI paired with solid income could unlock a higher credit limit.

The average credit limit in the U.S. was $29,855 at the end of the third quarter of 2023. It ranged from an average of $12,899 for Generation Z to $41,906 for baby boomers. At Experian, one of our priorities is consumer credit and finance education.

What is a normal credit score limit? ›

CIBIL scores can range anywhere between 300 and 900, with 900 denoting maximum creditworthiness. A CIBIL score of 750 or above in your credit report is ideal. It will aid in qualifying you for personal loans and credit cards.

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Average credit limits

Because many consumers apply for store cards as their first credit card, your first credit limit is generally going to be on the low end. Though Equifax notes these retail cards averaging between $2,000 to $2,500, credit limits can be much less than that — in some cases below $1,000.

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Many credit experts say you should keep your credit utilization ratio — the percentage of your total credit that you use — below 30% to maintain a good or excellent credit score.

Generally, a high credit card limit is considered to be $5,000 or more, and you will likely need good or excellent credit, along with a solid income, to get a limit of $25,000 or higher.