Top 5 Reasons to Get a New Credit Card
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When it comes to relationships between people, loyalty is considered an admirable trait. When it comes to the relationship between a consumer and a credit card, however, loyalty can be detrimental to your financial health if your needs, lifestyle, and spending patterns are no longer in sync with that card’s benefits, features, and policies.
Is there a card in your wallet that’s looking worn but giving you little back for your loyalty?
Here are the top 5 reasons to consider getting yourself a shiny new one:
1. You want more and better rewards
If your current cards don’t offer many (or any) cash back rewards or deals on travel, hotels, and car rentals, you may be bypassing significant savings. The same holds true if you have a card with rewards that doesn’t match your current spending patterns - e.g., the card offers 2% back only on purchases at hotels but you rarely travel. (As a general rule, rewards cards carry higher interest rates, so they aren’t ideal for people who carry balances. Rewards cards are a great option for people who plan to pay in full each month. If you plan to carry a balance, consider a low interest credit card instead.)
In addition, if you make $3,000 or more in purchases in the first 90 days from opening an account, you'll earn 40,000 bonus miles (worth a $400 travel statement credit) with the Barclaycard Arrival Plus.
Plus, if you make $500 in purchases in your first 3 months from account opening, you'll earn a $100 bonus with the Chase Freedom. In addition, the card has a 0% intro APR for 15 months on purchases and balance transfers. After the intro period, a variable APR of 13.99%-22.99% depending on your creditworthiness.
2. You want to save money with a 0% introductory APR
These days, it’s possible to find a credit card offering a 0% introductory APR for 12 to 18 months. Done correctly, transferring balances from your existing credit cards to a credit card with a 0% introductory APR is a great way to save money.
3. You want to improve your credit score
Because your credit score is determined, in part, by the amount of credit card debt you carry compared with your credit card limits (the “credit utilization ratio”), getting a new card can help improve your credit score in the long run. For example, if you currently have a balance of $5,000 on a card with a $7,500 credit limit, your credit utilization ratio is nearly 67%, which is considered high. By signing up for a new card, that ratio will drop.
Plus, you usually just need average credit to qualify for the Barclaycard Rewards. If you have bad credit, consider a secured credit card instead.
4. You want a lower interest rate
Chances are, the credit cards you got when you were younger, poorer, and had a less-established credit history aren’t giving you the best interest rates and credit limits. If so, it’s time to “play the field.” As long as you have a good score, apply for a card with a lower APR.
5. Your old card keeps delivering nasty “surprises”
If your old credit card changes its terms, policies, fee structures, or rewards program more often than you change your socks, it may be time to find a better match. For example, if you occasionally need cash advances, but the card keeps raising the interest rates on these transactions, you may be able to find a more suitable “partner” elsewhere.
If you’re a mature adult with a good job and a good credit score, it probably makes no sense to stick with the card you got when you were a struggling college student with no credit history. You’ll probably qualify for a new credit card with a lower APR, better rewards, and more perks. Sometimes the best way to manage your credit is to get a divorce and find a new credit card.
Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author's alone, and have not been reviewed, approved or otherwised endorsed by any card issuer. This site may be compensated through the Advertiser's affiliate programs.
Disclaimer: Discover is a paid advertiser of CreditDonkey.
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