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More Amex No Pre Set Spending Limit Fun

Recently I wrote about how I ran up against my American Express charge card’s mysterious spending limit. Well I did it again, and after a phone call with Amex, I can shed even more light on how theses charge cards’ limits are calculated. Despite their disadvantages (including the annual fee), I am an advocate of the American Express® Premier Rewards Gold and Green cards. I think these charge cards are what plastic should be.

These cards provide only a short-term loan (one month), and do not charge interest. They allow you to consolidate expenses and worry less about cash flow, but do not allow you to get in over your head and into mountains of debt! I only wish I had gotten one of these – and only one of these – way back when instead of my once impressive collection of other credit cards.

One of the tricky things about these Amex cards, however, is that they do not give you a credit limit. They word this as a good thing: “No pre-set spending limit.” But it’s not an all good thing.

“Great!” You think. “I can put my next car on the card and earn rewards!” Maybe, if: 1.) You have provided Amex with your salary and access to your bank accounts, which of course must show you have the cash on hand to cover the car, 2.) you have had your Amex card for many, many years and have consistently charged tens of thousands of dollars a month and 3.) you have a bulletproof credit record.

Unfortunately, for the rest of us, no pre-set spending limit can be a pain in the ass. This is especially true if you get a new Amex card and think you can immediately use it for all your monthly expenses – or worse – business expenses.

Recently I had to buy a last minute airfare (over $700); on top of about $1,500 of expenses I had already charged to my Amex Card. I had a gut feeling this was going to enough to shut off my card; the last time it turned off around $1,500, but I wanted to test it anyway, so I used it at a hotel later that week, and I was right: declined.

When you think about it, somebody with my income and credit would get credit lines of between $6k and maybe even $10k, but the Amex charge card limit is under $2k? What gives? Well, for starters, Amex needs its money within the month – they aren’t looking at how much they think you can pay them off over 30 years…they are looking at what you can afford over 30 days!

The next day I paid the balance in full and then called up Amex to see what was up. I asked: “For the second time I’ve hit my spending limit while traveling for business, which is, as you can imagine, embarrassing. I was wondering if there is any way to raise this limit, or at the very least know where it is going to be so I can avoid exceeding it?”

The woman I spoke to was very nice but rather mysterious at first, giving me a line I already knew: your limit is calculated by your account history with Amex, financial resources known to them, and your overall credit history.

Then we started getting into details. A lot of it has to do with the fact I am a new customer. I’ve only had the card since October, and with the exception one month, my spending has hovered around $600 a month. She told me they use both my average spending and my high balance in future spending limits. Fair enough.

Then she brought up my credit – it is okay, nothing crazy bad on there, but I do still have all those high credit card balances I’m paying down. Yes, I know, thanks for the reminder. But that is obviously on their radar. (It also happens to be the reason I’m using this pay-in-full charge card in the first place).

Next she said, well, we don’t even have your income. That’s odd, because I swear it was a field in the card application, but anyway, I gave them my income. The only thing is, I don’t know if my income is going to help or hurt my limit. And she wouldn’t say.

Finally, she did throw this out. “While we can’t say that your limit is always going to be X or Y, you can be confident you will always have $1,000 available.” Interesting. At least it gives me a caution zone, but $1,000 is totally insufficient for my business travel. Some hotel stays alone are well over that. And, I want to stretch my limit, and it sounds like the way to do this is to make higher and higher monthly charges.

There is also the option of overpaying the balance to get a credit on the account, which would then combine the available credit line with basically a pre-paid balance to draw from. Not ideal, but still better than going into new credit card debt.

Disclaimer: This content is not provided or commissioned by American Express. Opinions expressed here are author’s alone, not those of American Express, and have not been reviewed, approved or otherwise endorsed by American Express. This site may be compensated through American Express Affiliate Program.

About David Weliver

David Weliver is the founding editor of Money Under 30. He's a cited authority on personal finance and the unique money issues we face during our first two decades as adults. He lives in Maine with his wife and two children.


  1. Let me tell you the thing they didn’t.

    Typically, your AmEx spending limit is three times your highest paid-in-full balance over the last six months. They are also pretty good about allowing you some flexibility if you call them ahead of time to inform them of pending charges (I’ve done this with $8000 business expenses without any issues).