The usual credit limit for a first credit card could be anywhere between $100 and $500, depending on which card you get. It could be as low as $100 for store credit cards, or up to $500 if your first credit card is issued by a bank or credit card company. Getting approved for a first credit can be difficult if you have little or no credit history.
If you qualify for a card, you may end up being disappointed with your starting credit limit. That’s because your credit history is one of, if not the key factor that goes into extending an applicant’s credit limit.
Here’s what you should know about your first credit card limit:
Median credit card limits: The median credit card limit is $5,394, according to TransUnion data from 2021. And according to TransUnion records (released in 2021), the average credit limit for new accounts is $4,468. But there is no exact data on the average credit card limit for people that have limited credit history.
Get a higher initial credit limit: It is possible to get a higher initial credit limit by applying for a secured credit card. In this case, the security deposit will count as credit limit. And for some cards you can put as much as $1,000, or even higher. You can also get a higher credit limit if you’re listed as an authorized user on a card with a stellar credit history.
Get a credit limit increase: Many credit card issuers review accounts regularly and raise credit limits automatically if the account is in good standing. So, in order to get a credit limit increase, make sure you use your credit card responsibly. That means paying your bill on time every month and keeping your credit utilization below 30%.
The initial credit limit that you will get depends on several factors, such as your credit score and income. So, if you have a limited credit history, it’s hard to get a high credit line. But once you start building your credit, you will have a better chance at getting a higher credit limit.
If you already have a mortgage or loan in your name you may be extended a more generous credit limit, provided you’ve managed those accounts responsibly. If you’d like to know where you stand, you can check your credit score for free, right here on WalletHub.
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