"Thousand dollar limit" — Shark Tank investor Kevin O'Leary shares insight on handling credit cards

Kevin O’Leary, well-known for his role as a Shark Tank investor, emphasizes the importance of using credit cards responsibly to build a strong credit rating. In a recent Instagram post, he shared a simple strategy for those looking to establish good credit.

“It’s good to get a credit card, put maybe a thousand dollar limit on it and then start paying off, you know, use 200 bucks a month and pay it off every month.” he said.

This advice highlights the approach he encourages to maintain a healthy credit score, which can be pivotal for borrowing money for larger purchases like a home or car.

---

Shark Tank investor Kevin O'Leary’s guide to responsible credit card use and building strong credit

The key to building credit: Start small and stay consistent

In his Instagram video posted on January 31, 2025, O’Leary underscored that one cannot "game the system" when it comes to establishing credit.

“There’s no way to gain that system. You’ve got to establish a credit rating or you can’t borrow," he explained.

For those new to credit cards, O’Leary advises using a small credit limit to avoid overwhelming oneself with debt.

“Put maybe a thousand dollar limit on it and then start paying off,” he added.

This strategy not only helps in building credit but also encourages financial discipline. By spending responsibly and making regular payments, individuals can improve their credit ratings over time without accumulating excessive debt. The Shark Tank investor also shared a personal example, advising his son on how to handle his first credit card.

"I told my son as soon as you get one, Trevor, put 50 bucks on the card and pay it off," he mentioned.

By doing this, his son has managed to build a strong credit score while keeping his usage minimal. O’Leary’s approach demonstrates that responsible credit card use is less about spending large amounts and more about managing small transactions efficiently.

---

Insights from CNBC: Kevin O’Leary’s strategy on credit cards

In a 2018 interview with CNBC Make It, Kevin O'Leary advised using at least two credit cards for added financial security.

The Shark Tank investor explained that one card should have a low limit, such as $2,000, which can be used for online purchases. This limit serves as a precautionary measure in case of online security breaches, ensuring that any potential loss is limited to a manageable amount.

“The first credit card is one that has a very low limit, let’s say $2,000,” O’Leary explained.

This approach helps protect users from fraud, as they are only exposing a smaller amount of credit to online transactions. For more significant purchases that are not made online, O’Leary suggests using a separate card, adding,

“The other card is the one you use when you actually buy things that are not online.”

Additionally, O’Leary provided advice on credit card rewards programs. He emphasized focusing on cash-back options instead of affinity points, such as those for airline miles.

"Forget about affinity points...There’s so much inflation in that. You get less and less every year for the points." he advised.

The Shark Tank investor suggested that cash-back rewards are more stable and offer better value over time, making them a more practical choice for consumers.

---

Kevin O’Leary's credit card habits

In the same CNBC interview, the Shark Tank investor shared details about his credit card usage. With frequent travel being part of his lifestyle, he carries multiple credit cards to ensure convenience and avoid foreign transaction fees.

“I look for efficiency, and having all these credit cards gives me diversity,” he said.

He referred to his use of cards in multiple currencies like Swiss francs, British pounds, and euros. O’Leary highlighted how this strategy helps him avoid the frustration of paying additional conversion fees when traveling abroad.

“My whole thing about credit cards is I don’t like fees,” O’Leary stated.

The Shark Tank investor stressed that carrying multiple credit cards allows him to navigate various currencies efficiently without being penalized for currency conversion. His financial practices demonstrate how credit cards can be used strategically to avoid extra charges while maximizing the benefits of travel and purchases.

---

Tune in to Shark Tank on ABC, Fridays at 8 PM ET, and catch all the action. Full episodes are also available to stream on Hulu!