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Maxed out your credit card? It’s OK. It happens. The important thing is to understand the consequences and find out what you can do to get the debt under control. The immediate impact of maxing out your card depends on your current financial situation.

Did you max out your card because you are experiencing financial difficulties? Or, did you max out your card out of convenience, to get rewards, or to finance a specific purchase that you can afford but prefer to pay for with credit?

What is a Maxed Out Credit Card?

Maxing out your credit card means spending all of the available credit. When you max out a card you can’t spend any more on that card until you have paid down the balance, including any interest owed.

Top Reasons People Max Out a Credit Card

  • Medical Emergencies
  • Emergency Car or Home Repair
  • Job Loss
  • Travel Expenses
  • Moving Expenses
  • Poor Spending Habits

If you’ve maxed out your credit card and can afford to pay down the balance, you’ll want to do that as soon as possible. If you can’t, you’ll want to follow the tips in this blog to get things under control.

What Happens When You Max Out Your Credit Card

The credit card company won’t penalize you for maxing out your credit card, but they will charge you a higher minimum payment. If finances are tight, the increase in your monthly minimum payment and the extra interest could make it difficult for you to pay your bill. 

Some credit card companies charge more in interest fees if you max out your card while also taking advantage of a special service like a balance transfer, cash advance or foreign transaction.

Impact of a Maxed Out Credit Card 

  • Pay a higher minimum payment
  • Pay more in interest
  • Possible impact to credit score
  • Difficulties taking on new debt

If you experience difficulty paying down a maxed out credit card, it can create a domino effect that can derail your finances. If you feel that a maxed out card is causing you financial distress, follow these tips.

Create a Budget and Reduce Your Spending

Once you’ve maxed out a credit line, you may realize that your new minimum payment is more than you can afford. Even if the payment is still affordable you’ll want to update your budget and make adjustments to your spending as needed. 

Don’t have a budget? Try out our budget planning spreadsheet!

Make a Repayment Plan

If you can’t pay down the credit card in a lump sum, You’ll probably want to plan on paying more than the minimum payment to get the balance down. This is especially important if your credit utilization is above 40% or the interest rate is very high.

Do Not Take on New Debt

Taking on new debt like credit cards, store cards, personal loans, mortgage payments, and car loans may not be a good idea if you are overwhelmed with your current debt. Focus instead on your repayment plan and sticking to a budget.


Taking on new debt may be OK if you are doing so to consolidate your current debt.

Explore Debt Consolidation Options

If you are struggling to manage your debt you may want to consider all of your debt consolidation options. Some options like a balance transfer or a debt consolidation loan work best if your credit is still in good shape, while working with a company like Accredited Debt Relief may be a better option for those struggling with poor credit or want to pay down their debt in 24-48 months.

Debt Consolidation Options for a Maxed Out Credit Card 

  • Balance Transfer
  • Debt Consolidation Loan
  • Working with a Debt Consolidation Company like Beyond Finance

Look for New Sources of Income

Securing new or higher-paying employment is a great way to get your debt under control. If you are happy with your current job, but still need extra income, you may want to consider a part-time job or freelance work to help you pay down your debt.

Working a few extra hours in the evenings or on the weekends, so that you can pay more than your minimum payment may help you pay down your debt faster.

Focus On Repairing Your Credit

If maxing out your credit has damaged your credit, you’ll want to think about repairing it through good spending habits. While repairing your credit is important, you should focus on having a good budget and manageable repayment plan first. Once you have these in place, it will be easier for you to practice good habits that may help you improve your credit score.

Is It Ever Ok to Max Out a Credit Card?

Though it’s not recommended, there are some scenarios in which spending the limit on your credit card may make sense. Check out this list of the 6 times it’s OK to max out your credit for more information.

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