reducing cc bill, is this a good idea?

[southeastastra]

i owe quite a bit on cc, would it be sensible to reduce the limit each time i pay off a certain amount? ie if I owe 9,000 when i reach 7999, reduce the limit to 8,000 etc until i reach about 4k?

If it stops you spending, then yes BUT make sure your limit is sufficient to cover any interest charges if you have to drop back to minimum payments for a couple of months just in case.

Only if you can't control your spending any other way? What will stop you taking out a new card?

Be prepared for a bit of a fight every time you want to do that though as it is not what the CC companies want to do!

I think there would be better products for you to manage your debt.

i do have another card that's 0% but the amount i could move over was limited, what other products impatient? good point doris forgot about the interest

Have a look at my credit card spreadsheet on site stuff ....
I'll bump it for you
The best thing to do is freeze the amount you repay each month ...

There are three advantages of reducing your credit limits:

• it stops you spending more on the card
• it gives you success milestones to celebrate on the way to clearing your debts (of course you can have these without reducing your limits, but they are a very real proof of the progress you are making)
• it means you are more likely to be approved for 0% or other low interest rate credit.

Apart from the hassle of making the phonecalls, there is no downside!

Are you over paying all your cards? It would be more efficient to pick one to overpay and pay the minimums on the rest. Overpay the one charging the highest rate and you will clear your debts as fast and as cheaply as possible, see snowballing.

The other products you could consider if you have a lot of debt are low interest rate loans to pay off the highest interest rate cards or low lifetime balance transfers. These are more expensive than 0% offers, but you may get approved for larger amounts.

(nb I don't make any money from any sites that I link to.)

one trouble with reducing your limit is that they will get VERY shirty if ever you need to raise it again (eg to buy something big for the house)

have a look at the spreadsheets I've posted up - put your numbers in and you'll see what a HUGE difference freezing the payment makes ....

I applied for a different card & they reduced my limit by loads! Nothing had changed & I pay my bill off every month. Had my original limit go up to £13,000 though without me ever asking & never spent anywhere near it. Now it is enough for a months worth of groceries & petrol & the cost of a foreign holiday for us if I want it. Not sure i would reduce the limit until I was sure what i needed, you get charged a LOT of money for going over your limit!