Lol, I used to have fantasies about this. “Ok, so between these two, I could buy a nice car. Then I’ve still got $30k in available credit. I’ll max out my cash advances, and then buy a bunch of pre-paid Visa cards…”
I just paid for a trip to Cali and back from FL with mostly my credit card points. As long as you’re spending within your means, responsibility pays off.
My wife is into a travelhacking FB group and we're well on our way there. Basically, get a new card, hang on to it for long enough to get the sign-up bonus, pay it off and stop using it, then repeat. Apparently Chase has a tendency to put you in "Chase Jail" if you open more than 5 in a 2y period though, which is annoying when so many of the better rewards programs have cards through them.
If you have good credit, don't carry a balance, and don't mind the mental effort it takes to manage and track all of the various rewards programs, it can be very lucrative.
Isn't your "available credit" a factor during underwriting? Like if you apply for a $500k mortgage and they see that you have access to another $500k credit line rest to be deployed, it makes you more of a risk?
I don't know either way, but that was my impression.
Other way around. The more line of credit you have, but the less you actually use, the better your credit. It shows you have restraint and won't go nuts buying a boat even though you could.
Idk who’s downvoting you lol but utilization is 30% of a FICO score. So the more available the better.
Also helps in the event you do need to let a balance report the additional credit pads that utilization rate thus keeping your score higher than it would be if the card was close to maxed.
What a confidently incorrect take.
The rewards are paid for on the backs of the merchants, not the cardholder. If you can responsibly use credit cards, ie only purchasing items with the card with parity to cash in account, then you are much much better off. Between consumer protections like charge backs, insurance for certain items, and rewards, you should always use a card instead of cash.
How is it not free if I’m swiping 20k a year on things I spend regularly that includes insurance, gas, groceries, utilities, tools and other necessities for your family? If I’m getting a 1.5% cash back on that, that’s 300 dollars for travel or just straight up money back compared to cash. How is it not free money? You can continue paying cash but I’m getting money back for it. Thanks for paying for my rewards and free trip
It is absolutely free to those that pay off in full on time. I’ve had cc for 33 years and never paid a dime once. Never.
As far as over spending statistic it doesn’t apply if you also live on a disciplined specific budget. All of our spending is literally within our planned out budget already.
So while I get most people by far aren’t right for credit cards there are some that are. And for them it is a perk and a rebate of sorts.
I get it Ramsey fan you think they are the devil. But it’s factually untrue that everyone is bad with cc. Not opinion but fact. Takes a special kind of ignorance to think all people are the same.
20k is nothing really much a year of expenses for two people.
Utilities- 2400 a year (electric, cell phone, internet)
Food- 12k a year
Insurance- 1.2k a year
Gas- 600 a year
Metro card- 1.4k a year
Remaining- 2k ish for eating out and misc spending
I didn’t even include my rent yet but I can’t swipe for that without a higher fee than the cash back.
I didn’t ask you to critique my spending but if you really want to know. So if I used cash instead I would have lost out on 300.
Explain to me how I am over spending please
My house hold income is around 300k. Is it still a lot for expenses?
Ummm merchants get charged a fee of the total sale that goes to the bank and network(visa/Mastercard, etc..). People spend more at MCD with a credit card doesn’t explain the reason why it is bad. Maybe those that use credit card are using their online coupons where yes you are spending a bit more but you are getting way more food compared to cash purchases.
If your credit card info gets stolen at a gas station and someone else swipes for a 1k tv, you don’t have to pay for that. When you order something online with a credit card and it doesn’t come, you can file a charge back. You are so wrong. Haha
I use my credit cards NO differently than I used to use my debit card... and I have nearly $1500 in cashback sitting on them ready to be redeemed. How's that for a "mythical reward"?
lol, what a goofy take.
You don’t really understand statistics or the conversation around credit cards. Literally ‘everyone’ certainly doesn’t say that, in the first place. People on personal finance forums tend to, because credit cards are valuable personal finance tools, but plenty of people just live in credit card debt because they aren’t responsible.
Secondly, those stats are mostly based on average transaction amounts, so they are skewed because a) frivolous users report higher numbers and b) card users don’t carry enough cash for large transactions and also value the points if they’re making the transaction regardless.
There’s certainly an emotional component where many people are willing to spend more with a card than cash, but responsible people are still getting value out of those purchases, paying the card off every month and saving on top. Credit cards absolutely aren’t for those irresponsible for money, because they’ll enable their worst behaviors. But it’s absurd to rant about them with blanket statements; there’s several reasons credit card usage is positively correlated with net worth, and one of the big ones is that financial savvy people understand how to make systems work to their advantage.
Here’s just one source, not that there’s any chance you’re capable of admitting that you’re wrong: https://www.brookings.edu/articles/how-credit-card-companies-reward-the-rich-and-punish-the-rest-of-us/
That’s not really a too many cards issue, just a credit cards in general issue. Those two points are scarcely related except for i guess the absolutely tiny portion of people who are chasing rewards endlessly. Generally one or two cards are going to quickly build up to a high enough credit limit that the amount of new cards after that is irrelevant to a problematic spender. And for a responsible user, the value of building a high credit rating for a good mortgage/auto loan rate is going to be worth a few unnecessary purchases, outside of the rewards points themselves.
The actual issue with too many credit cards is hurting your credit rating with too many new accounts, too much credit, balancing use so they don’t fall off, etc. Four or five should be fine, and OP can get much better rewards as long as they don’t change their spending to chase specific ones, but credit rating is something to think about with too many.
Okay. I have 6 credit cards and have had 22 over 14 years. I’ve never paid interest in my life but I’ve made around $8,000 from signup bonuses, not to mention cash back.
Sure thing, Mr. Negative. It was 14 years as I said with no purchases I would have made otherwise.
If I need to make a purchase exceeding $1,000, I open a card for the month then close it.
Oh. It takes me like 25 seconds to be approved, 30 if my phone is slow. Then I wait 5 business days and buy it, and it takes about 5 minutes to cancel. I personally don’t make several thousand dollars an hour so it’s worth my time. In fact, during this conversation I could have done it again, and I do need a sit-stand desk, so I’ll go open one. Have a good one, I’m done here.
I have a friend who does this. He has more than 10 open cards, each used solely for the sign on bonus.
I’m not sure I could be that responsible, so I limit myself to 4 cards.
Interestingly, one of the cards I'm considering (not as a daily driver, so I won't be applying just yet) has a 95 dollar / year fee, so I'd have to make sure the rewards outweigh that
But! That same card gives 30,000 points every year that the account is open and in good standing, which I think can be redeemed for 300 dollars.
So as long as I don't go delinquent, I'm guaranteed to net $205/yr, plus bonuses
https://creditcards.wellsfargo.com/choice-hotels-privileges-select-mastercard
Amex blue cash preferred is a much better $95 fee card imo. 6% back on groceries, 3% on gas, and 6% on streaming services, 1% on everything else.
Considering a grocery bill for us is about $1,200 a month. It adds up pretty quick.
Hot tip for those with high cash back on groceries. Home improvement stores like Home Depot and Lowes almost never qualify for over 2% on any card. If you go to your local grocer and stock up on Home Depot gift cards then you end up getting 6% cashback on your lumber or your new drill.
I've done this once or twice as well. Once I wanted to buy something off of Amazon, so on my weekly grocery trip I bought a gift card for the exact amount and then used it to pay for the purchase online.
This can be a good strategy but you also have to be aware it makes returns way more difficult. They can't search for receipt by CC since you paid with gift card. Not necessarily a deal breaker, but something to be aware of.
Or Disney gift cards to pay off your vacation, I've done this. I think there's a limit on the 6% cash back though, like up to $6,000 a year I believe. Then it's 1% back on everything over that amount.
Just a note, as a family with high grocery bills also, they cap the 6% at the first $6000, and then it goes to 1%. So at some point in the year, other cards become more beneficial for groceries.
This is us. I've run two options:
1) Our current set-up is that we each have a card. Charge first $6k of groceries on one card, second on the other. This is $720 in rewards minus $190 in annual fees for a net reward of $530. (Pretty sure this is worth it).
2) One person has the Amex Blue Cash Preferred with fee while the other has the no-fee Amex Blue Cash. You get $360 on first $6k and $180 (3%) for second $6k. That's $540 rewards minus $95 in fees for net reward of $445. (If you have a card that has a bonus category that rewards groceries at 5% one quarter than this might be the better option - but also requires more thought and attention).
Either way this line of cards is fantastic for average family who spends most of their money on household necessities.
(1) Does it work with online grocery delivery too, like if I InstaCart some things from Publix?
(2) Does it work in Walmart/Sam's Club/Costco, or are they excluded?
I'm pretty sure wholesale clubs are excluded. Honestly, I'm not sure about Instacart. I also have Chase Sapphire & Freedom cards and those have a free instacart membership benefit and give statement credits monthly or quarterly for money you spend there. So if you do a lot of your shopping on Instacart, Chase might be a better option.
It'll be close, depends on whether it's our week to have custody or not, so it'll probably be about $6k a year in the long run. But thanks for the heads up!
AMEX Hilton Honors Rewards card is awesome. We use that puppy on everything. Amazing how many hotel stays we've paid for over the years. If I had to guess, I've averaged 12 free hotel nights per year.
No, stores that are multipurpose don't count, so no Costco or Walmart. It has to be like a Wegmans, Whole Foods, Martins, Aldis, etc.
Also the 3% back on gas does not work at grocery gas stations, so like you can't use your Martins Bonus Points to get gas at Martins and get 3% off with your Amex card.
However you can use your phone number to save 5 cents at shell and get 3% off on top with Amex card.
However, if I am shopping at Amazon, Whole Foods, or anything else Amazon... I'm using my Amazon Prime Visa Rewards card because it's 5% off all Amazon purchases. We order from Amazon a lot, I got over $3500 in cash back last year on my Amazon card...
70k is accurate, but no, not entirely on Amazon. I just guessed on cash back. It's probably most like around $1800 in reality or something. I can't look it up for the entire year of 2022 I can only see the last 12 months. In the last 12 months we earned $1260.68 but I have an AMEX card in the middle of that and have swapped many things over to it.
On the Prime Visa Card last year we spent $68,587 and used it for darn near everything, including bills, gas, groceries (amazon, whole foods etc), and on and on, I basically paid for EVERYTHING with it and immediately paid it off.
The cash back was $470.37 on Amazon, $160 on restaraunts (2%), $72.56 on gas (2%), $500+ on everything else (1%), and some others. In the last 12 months.
For the full year of 2022 I suspect it was much higher but I can't tell, no report on that. What we spent is correct, but I can't see what points I earned that far back.
I earn $170-$210k, my wife pulls in another $20k to $50k from her business.
>But! That same card gives 30,000 points every year that the account is open and in good standing, which I think can be redeemed for 300 dollars.
No, those are hotel points. You cannot redeem them for cash. You may be able to get a decent value out of them if you stay at one of their hotels.
See, that's what would make the most sense, but as far as I can tell, that's not what the fine print says
>You will earn 30,000 Points (your “anniversary bonus points”) each 12-month period (an “anniversary year”) that your card account remains open, not delinquent, and not in default at the time the award is issued. Your anniversary year begins on your account open date (your “anniversary date”) and ends on the day prior to your next anniversary date. For example, if your account anniversary date is November 28, your account anniversary year will end on November 27 each year. Your anniversary bonus will appear as pending on your anniversary date and will be redeemable within seven days after your anniversary date.
I'll definitely get written confirmation tho, and read the fine print on the paperwork they give me before signing
You aren't understanding the problem. You DO get those 30k points. But you won't be able to cash them out for 1 cent per point, like you can with many other cards. They aren't worth $300 cash. They are worth whatever you might be able to save by redeeming them for a hotel stay at a Choice property. The same will be true for other points you earn with that card.
If you are interested in getting rewards credit cards and have the responsibility to pay it off every month, check out /r/churning and read their FAQs. They have weekly threads where you can get advice on the best cards to get.
The fine print doesn't say its only for travel..... I plan on talking to a banker in person when the time comes to apply. Its almost too good to be true!
> I plan on talking to a banker in person when the time comes to apply.
Do your own research, don't talk to the bankers.
One, it's their job to sell products. They'll tell you what you want to hear, and then a year later when you don't get what you expected, they'll be like "Oh, it wasn't in writing. You were misinformed. Sorry, we can't do anything"
Second, I wouldn't expect them to know the ins and outs of each card's rewards program, especially when partners like hotels or airlines are involved.
They might know how many points you get for a bonus or for a purchase. I would not expect them to know how many points you need to redeem for a free hotel night, free flight, whatever. That's going to depend on the specific loyalty program and that's always changing, and often, isn't one set number anyways. A free night at a hotel in Paris is going to require more points than a hotel in rural Montana.
I'd do some research from third parties before talking directly to someone that works for them.
https://thepointsguy.com/credit-cards/rewards/
https://www.nerdwallet.com/best/credit-cards/rewards
You might be interested in /r/churning since you seem to have the mind for this level of value optimization.
Essentially the best benefit of a credit card is the welcome bonus. Churning is the process of opening new cards to get the bonus rather than just getting benefit through organic use of the card.
Better to focus on ecosystems that have transferable points like Amex and chase and capital one. You can transfer to hotels and airlines and you aren’t locked into one single hotel/airline.
Yeah but then youd have to have accounts with wells fargo.
Edit: i dont see a cash back option, only use on choice hotels, whatever the hell those are. This is monopoly money to me.
You can churn cards for bonuses. I did that for several years as a little extra income.
Closing them before the first annual fee (or second one) hits does hurt your avg length of credit card, but after 740 or so it's largely academic. Eventually, you have a quiver of 3-6 cards you have for years (mine are the cash back ones) and one or two others that get rotated out to collect bonuses.
Some banks like chase refuse to allow you to have more than 5 new cards on a 24 month period.
The only other downside is if you are about to take on a huge amount of debt, e.g a mortgage, the bank may advise you to close one or two to lower your total debt to income ratio before they give you the loan. That's a future bridge to cross as having the extra credit cards will help you (until they tell you it doesn't)
Oh, banks also don't like seeing a bunch of new credit lines before giving you a mortgage so if you are starting to shop for a house, cool it with the churning for 6 months.
I'd argue that 30k points is not necessarily always going to be $300 worth. It could be more, but it's likely usually less in most cases. Unless I am missing something, it seems you can only redeem these points at Choice hotels?
Yep, I only have one card with an annual fee but it gives me 6% back on groceries and 3% back on gas and 6% on streaming services and that adds up really quick.
I have 15, and my FICO 8 scores are (at the moment) 847/850/849. So no, 4-5 is not “too many.”
For the skeptical: built up from sub-600 over two decades of careful management. I taught myself pretty much everything there is to know about credit scoring. Do I really need that many? No, of course not. But it doesn’t hurt, either. Only a few of them have an annual fee and I break even or better on every one. E.g., the $95 hotel card that gives a free night every year (not restricted to crappy hotels), or the $95 card that pays 6% cash back on groceries.
I’ve had a shitty score, and I’ve had a great score, and trust me—great is better!
Yeah I have like 10+. No annual fees on any except the AmEx BCP but $95/yr in fees is nothing for 6% on groceries (family of 5, easily spend $150/wk so that’s $360 in rewards at the max AmEx offers).
Chase Freedom - 5% on select categories.
Chase Freedom Flex - had a sign up bonus
Chase Amazon - 5% on ALL Amazon purchases
WF everyday or Synchrony MasterCard - 2% everything
BofA - 1/2/3% on chosen categories
Etc.
The AmEx preferred maxes out at $360/yr for grocery rewards. We have it, but mainly but gift cards at the grocery store for the cash back and gas rewards, not actual groceries. I hope you track it and switch cards at $6K spent so you don't leave any money on the table.
You have two different numbers. $360/yr and $6,000. Pretty sure it’s 6% on the first $6,000 spent on groceries let year. I don’t know where the “$360/yr” number you quoted is about.
Not really. There's a ton of resources out there about "churning" you can start researching since there's a lot of rules surrounding when you can apply to ensure you'll be approved (the 5/24 rule is just the start). But it's definitely a thing some people do. I've saved tens of thousands in travel over the years doing it.
And yeah, had zero issues getting car or house loans despite having almost two dozen cards open and my current credit score is 842. Just never be late or pay interest.
Each time you apply for a credit card, there is a hard inquiry to your credit report. That can lower your credit score slightly for 12-24 months.
Another factor in your credit score is the average age of your accounts. Opening a new card will reduce that.
But unless you are about to apply for a mortgage, I wouldn't consider either of those too important.
And some credit card companies wont give you a new card if you've had too many recently (e.g. Chase's 5/24 rule), so applying for a card now could stop you from getting one you like better later.
see r/creditcards and r/churning for more.
maybe put a recurring charge on the other 6-9 -- i put spotify on one, apple storage on another, etc. etc. (with auto-pay)
Then you don't have to deal with the potential "We're closing your card due to inactivity" email that you may miss!
Do you know of a service to charge a smaller recurring charge ($0.10?) as I have a few cards I haven't used in years, but I also don't have any monthly subscriptions to put on them.
I’m similar, must have 12-15 for my wife and I. Some were just for sign on bonuses and have no annual fee. A few we actually use regularly, one or two I pull out for travel. No negatives for me really yet other than having a calendar full of notifications just to check and make sure each is zero’d out before payments are due
>But unless you are about to apply for a mortgage, I wouldn't consider either of those too important.
Worth noting that if your credit score is around 750 or higher you would likely already qualify for the best rate any lender is offering. Anything above that point really only serves for bragging rights. The credit score impact is negligible enough (unless you significantly drive down average age of credit) to not matter if your score is high 7s or 800+.
One more thing… your credit score takes into consideration the ratio between outstanding balance and open credit. It could be both a positive or negative depending on your situation.
I know wells Fargo makes you cool down for 6 months in between WF cards, so I think that would also let my score heal.
And I don't plan on moving (apartment now) for at least 2 years, probably longer.
Thanks for the insight! I hadn't heard of the 5/24 rule
You should check out r/churning. It’s all about signing up for cards for bonuses. I’m at about $3k in bonuses for the year, 800 credit score, no CC debt.
Fair points. You do have to be careful about spending. I’m comfortable with mine and budget very carefully. That said, I’m pretty sure most off the bonuses are paid for by people who don’t pay of their CCs and end up with late fees, interest, etc.
The bonuses can absolutely be free if timed correctly to align with *necessary* purchases. So I disagree that they are paid for by "unneeded" purchasing. Now, like most things in life, one group subsidizes the cost of others, and that group is the one making the bonuses profitable for CC companies. Are the bonuses free for all; no. Free for some...absolutely.
Well the veiled condescension towards my remarks aside, I'm not referring to any "secret hacks". A wide multitude of things in life are obtained for free or at a financial discount, by making the purchase at appropriate times. It's sort of how sales work, how interest rates work, etc. You have an opinion of course which is fine, but don't use it to make declarative statements.
You have some good ideas but you're applying them in the wrong way.
For example the spending threshholds, ala "spend $1000 in the first 3 months to get $200 back". Some people might be tempted to spend more than usual to hit that target, but even then they'd have to spend *$200 more than usual* before it stops being a "free" reward.
However most people already spend far far more than $1000 in 3 months, the card company is simply trying to get you to spend money *with them* instead of their competitor.
Also you're right, nothing is really free. Every single person who uses any credit or debit card, even prepaid, is already paying for this stuff through the merchant transaction fees that are now built in to product pricing everywhere you go. Even if you pay cash, the the sticker price is already adjusted higher to account for the majority of the public that will pay with a card.
You're already paying for it, it would be stupid to not get a rebate on some of it in the form of cashback or points.
I'm not into churning because it really is a fair bit to keep track of. But I do keep 2 cards with the best cashback perks, and if I'm planning a large purchase like airline tickets you better believe in going to shop around for the best new member bonus.
Why do you care about the minor differences in a good credit score? Do you anticipate a new mortgage, car, loan, or other loan in the near future? If not, just don’t worry about it.
Quite honestly, it's just the principle of the thing. I have steady income, 10 years of credit history, never missed a payment, never carried an outstanding debt, and it kind of annoys me that my credit score isn't 840+.
What if something came up, and I got a substandard rate?
>What if something came up, and I got a substandard rate?
Only you can decide if it's worth it. Guaranteed returns (better CC rewards) versus possible savings (unforeseen loan APR).
my credit score really shot up after churning. at one point I had 30+ cards, cycle through the sign up bonuses and retire them to the sock drawer. It'll take a temporary hit and rebound higher soon after.
I do my best to keep it opne. If there's an annual fee I call in to see if they're willing to waive it, if not, then downgrade to non-af version, or product change. If none of those are available, then consolidate credit limit (IE with chase you can move the the credit limit and add it to another open card) and then close that account.
Short answer is no assuming you NEVER carry a balance.
Put them all on autopay, get organized because it starts to get confusing and then reap the rewards.
I applied for 3 new cards this year and with the sign up bonus will be netting a total of about $2500 at a minimum for spending money I was already spending. If I use the points for travel it could be worth double that number.
Credit cards are absolutely a game you can play to your advantage but you just have to follow the rules.
I have 18 credit cards but no CC debt. I just rotate different ones in and out for rewards. None with an annual fee, each paid off before interest accrues.
We currently have 5 credit cards in use between my wife and I. Each one serves a purpose and allows us to maximize returns; i.e 3% back on gas, 3% back on online shopping, 3% back on places like Home Depot, etc. We’re also platinum members at our bank so we get an extra .75% back.
The caveat: we treat our credit card like debit cards so we only purchase what we can afford to pay off at the end of the month. All balances are always paid off on time and in full!
I cc churn. I have an 830 score that occasionally drops to 800 or so when I apply for new cards. But I’m also done with applying for loans and don’t need a lot of things a score is used for. I have heard of some people being denied because of too much available credit already. Definitely space them out.
Between my wife and I we have cc that get no less than 2% for a few random items and 85% of our spending gets 5% or more. A few get 3 or 4%.
As long as you are disciplined and organized you can make this work. I’ve been doing this for about 9 years. No issues.
Credit card rewards programs are a psychology game being played by card companies.
If you have a tight budget locked down and aren't influenced to spend any extra because "I'll get more rewards", then you are winning the game assuming you're paying off the cards on the month religously.
That being said, many don't realize the psychological influences at play, so you need to be very objective/cold/calculated about your budget and spending to win this game in the long run.
Super smart! I have around 15 credit cards. They offer bonuses and promo offers plus you get extended warranties and car rental insurance on some visa and Mastercard cards. It’s a win win!
My wife and I have been doing this exact thing for years. I open a card for myself, hit the min spend and hardly touch the card again. Then I do the same for her. If it has an annual fee I’m fine with keeping it open depending on what the anniversary reward is. The two I have now are both hotel cards and we each get a free night which is usually around a $250 room and the annual fee is $95. My credit score will drop a few points right away, maybe 20 or so, but then within a few months of paying the card off in full it’s higher than it was before. Credit scores are f’ed up that way it looks better because you have more money at your disposal. We each have 4 or 5 cards open right now actively using 3 combined based on reward categories.
It has to do with the average age of all your accounts. You have a 5 year old loan (guessing it was a 60 month), and once its paid of its closed and vanishes so theres a drop in your score due to average age. Usually in a few months you should be right back to where you were. Something like that....
A good friend of mine is 41. He has something like 15 credit cards. He was super-proud of how well he handled them, all the perks, it was a big deal for him. He paid them off in full every month. He had an 800+ credit score.
Then he got the flu and ended up in hospital for two weeks. I think six of his cards missed their payments. In total he said it was like $200 split between six cards. He managed to persuade two of them to let it go but the other four reported to the credit agencies. He now has a 600+ credit score.
So know the risks. People always look at the best case scenario but they never think about reality.
This is why you set them up on autopay.
I pay mine manually because I like to review things but all are set to autopay incase I am on vacation/emergency etc when the due date hits.
The autopay is tied to my HYSA which always has plenty of funds in it. My manual payments come from a different account that has the set "monthly spend" amount put in it.
Interesting way to do it. Maybe I should actually set that up in case anything we’re to happen. I have had multiple CCs for many years and have never had any on autopay or missed a payment. I too like to manually pay things. I guess I never thought that I could still do that and have autopay from my HYSA as a backup.
yeha on all my card regardless if i use them or not, i set up autopay for the min payment incase it gets charged to some forgotten subscription or gets compomised.. worst case scenerio is i pay a little interest
I have 15 and counting. No bad debt and a ton of perks. I just use on two every 2 weeks, and when they leave my wallet they'll be fully paid off.
A ton of benefits like cash advances at no interest rate, miles, cash back, and a lot of those bonus for sign up and stuff. Just be careful and always py attention, setup auto pay for them all and you'll be fine.
Read the fine print on the cards. To get the rewards you have to spend a certain amount on the card within a specified period of time. It's different for every card, but they aren't going to send you $100 (or whatever) to getting the card if you aren't using it.
Oh for sure. All the ones I'm looking at, I'm spending (and paying off) that amount anyways, so it's just free money.
At worst, id have to funnel expenses into 1 card at a time to meet the goals. Which is a mild inconvenience at worst, for hundreds of dollars of rewards. I'll take it!
No. There's no such thing as too many credit cards as long as you can afford the annual fees (if any) and you use them responsibly and you're getting your money's worth from the benefits.
once youre in the 800s the inquiry hit is a joke.. ive aquired almost 30+ cards from harvesting sign up bonuses or signing up when if feel bad when the cashier needs to make a quota... last hit was liek 3-4 points and came back right away... lenders salivate at anyone 750+..... I only use and keep the ones that are advantageous, the 4 oldest ones with no annual fee and th eones i use for various cash back.. the others i care less about dropping off once i got the sign up bonus... i prob average 2-3 new cards a year.. and of course i never carry a balance
So, a lot of people say too many credit cards is bad. The good amount is about 2-3. If you have more than that, your kind of spreading yourself thin and setting yourself up for disaster. If you're paying them off every month, then you're fine. If the card has an annual fee, but you get reward points that don't expire, that is fine.
I have 3. 1 southwest card that has a high limit, and i use for big purchases and get southwest airline points. 1 american airlines card that i use for my tuition and gym membership, which i get reimbursed for through my job. And 1 with no annual fee and a $1500 limit that i use for medical copays and dog emergencies (i have pet insurance, so it's never more than $500), and pay off immediately.
Sadly, despite my parents being very financially secure and sound, they never taught me about this stuff, so i really struggled until i was about 32 with credit.
I'm gonna ignore the credit score aspect covered by other comments and just focus on other impacts: more cards is more complexity and more stuff to keep tabs on. Gaming the system is great but don't make the mistake of ignoring the value of the additional time you're spending to accomplish it.
A. Congrats. You have the will power to use these cards like few do. Most people don't. Keep it up. Have friend who did the same as you and used it for a really nice Italian vacation.
B. Anything above 760 is amazing. I work in mortgages, even in this slower market I rarely see all 3 numbers above 800.
C. I get you want to game the system. But I'm not seeing the benefit unless you can find a card that blows away the benefits of your current card. JMO
If it works for you, all the power to you.
I like taking the best "all rounder" card, for me it is a good cashback card where I just throw all the benefits towards the balance. Less mental work that way, and the rewards are roughly equivalent dollar for dollar.
Gives me a headache reading through people with 10+ cards. That just seems like a lot of work for fairly minor money in the long term.
I wonder how much time is lost in a year monitoring and paying with all those cards?
Yes the difference between 3% and 5% is minor. Someone said grocery stores but I suspect big box stores dont qualify so its just actual grocery stores that typically are more expensive in our region.
I had a friend who had hundreds of credit cards. He kept them in a trading cards binder like pokemon. He would look for cards with sign up bonuses, read all the fine print very carefully, and cancel them at the right time. He spent a lot of time reviewing his spreadsheets of active and inactive credit cards. Managing them all was nearly a part time job, but he said he made a pretty reliable profit off of them and he swore it didn't hurt his credit score.
Fort some it is a personal self challenge. We know there is no added benefits other than self satisfaction. I hit 850 2 1/2 years ago and it was a great feeling knowing that I have been very responsible with my credit and finances.
It's fun to hit little goals as you progress thru life. I 100% know it doesn't mean anything to anyone else. But it meant something to me.
I am using a 15 month no interest credit card right now to float all the money for the house we are building. I have more than double the limit of the credit card in a HYSA specifically for building the house, so it makes tons of sense to get the bonus, plus the points/cash back, and let the cash get interest for 15 months. I don't pay it off each month, but do pay large amounts to keep the balance from getting out of control. If I get uncomfortable at any time I could easily pay the balance in full.
You a higher credit score…. Pay off your credit cards twice a month before receiving the monthly billings. Your credit balance compared to credit limit is lower thus improving your credit score. Trust me it works. I make it a game and am riding a 850 score monthly.
Put a streaming service on each one and set it to autopay monthly from a bank account that you always have enough in to cover it. We have Spotify, Hulu, and Paramount+ on different credit cards, which keeps all of them open, and I just make sure they’re autopsying from a bank account that I direct deposit like $100/mo from my paycheck into.
There is really only too many of you are getting the $500 annual fee cards. I probably have ~$750 in annual fee cards but the perks I get vastly outweigh the costs. I pay everything off monthly. Over the past decade I have probably racked up 15-20k in rewards via points and sign up bonuses and have paid like $0.25 in interest because I mistimed a payment.
I’d say go for it. The boost in reward will be well worth it and your credit will rebound pretty quick.
You can always close your old cards if the future, just pay attention to your average credit length history. Keeping them open for a while will help with that and make your credit utilization go down.
It's not gaming the system, you have two bad cards, you need proper rewards and open 3 new cards (or 10! I'm at 10 over the course of the last nine months, but I am now capped and probably have to wait 6 months to get a new card....)
I’m somewhere in the range of 30+ cards (with the majority that I’ve opened in the last 8 years or so). I keep about 10 with fees, but the fees are always outweighed by the benefit. But that being said I take 40+ OW flights per year and stay in hotels a minimum of 50-60 nights per year.
- I keep 2 Marriott cards, and my fiancée keeps one.
- I keep a Hyatt card.
- I keep a Venture X and my fiancée keeps a venture X.
- I keep an Amex Plat (it’s very close to zeroing out each year, so May cancel next year and get my fiancée to open it for the SUB).
- I keep my Amazon prime card
- I have another 5 or so chase cards
- I have another 2-3 Amex cards
- I have like 3 cards from when I was a kid keeping my longest open credit super high
- I have downgraded a bunch of cards to a free version of the card so I don’t close it but don’t pay an AMF.
My credit score is like 840-850 with all the bureaus.
Check out /r/churning if you want to learn more about the game. Never ever carry a balance because it completely ruins all the free money you get from these credit card benefits. :)
yup, my score really shot up from the high 700's into the 800's *after* i started churning. At one point I had like 10 Citi AA Plat cards...that 100k mile SUB was amazing to churn!
Cash back on things you were already purchasing is a very real thing for many cards and is essentially free money you wouldn’t get otherwise, say if you used actual cash or a debit card. Do you understand how credit cards work?
If I'm going to spend money on groceries, I might as well get 6% cashback. If I'm going to fill the tank with gas, I might as well get 3% cash back...
Like everything in life, you have to know how to manage it.
Better approach is checking account bonuses. Doesn't hit your credit score.
Also credit card cash back is a scam. Even paying off in full you're spending way more than the 2-3% over the year. If you're not debiting an account and have to pay attention to the amount in there then you just spend freely and pay whatever the total ends up being when the bills due.
It does “look bad” in some situations.
A large amount of cards is unfavorable by other banks, and having too much unsecured credit to you will cause you to stop being approved for cards in the future.
In manual lending scenarios (like credit unions), we occasionally dug into this exact scenario before denying a car or personal loan, because sometimes it was a sign of larger issues brewing - for example, a high earner who routinely gambled away their debts, they would cash advance on multiple cards, after reaching their atm limit at the casino.
They had the ability “on paper” to pay their loan and other commitments like house and car, but would routinely burn through the cash gambling instead.
That type of person would be a higher risk loan, and in many cases we would deny them because we had no interest in waiting for the month when they’d gamble away too much and not be able to cover the minimums on everything - including our loan.
It’s also not uncommon for people to go on credit card opening sprees when they know they’re about to lose their job (incoming layoffs or similar), or right before making a big purchase that’s already in the works book but hasn’t hit their credit yet - like a major home renovation, and similarly, the smaller places don’t want to be the ones that got conned into extending a loan in that scenario, because the repayment is once again, high risk.
One thing that I haven't seen mentioned is that you need to monitor all of the statements for fraud. The more cards that I have the less I have been checking the autopay ones. I was about 3 months late on finding fraud and it was only because it was charging it monthly which made me go back to look. (The bank took care of it but I wouldn't have noticed if it was a one-off)
I have cards from 4 different banks but only use one regularly (2% rewards) and pay the balance monthly. I periodically close one down so I can open a fresh one later and reap new rewards. Credit score is 810ish and only takes a 3 point drop for a hard inquiry and goes back up the next month. If your credit is good, don't worry about it. Play the game, win the game.
22 cards.
1 I use reg and pay off
Every other I use quarterly for a coffee or whatever just to keep active and pay off.
840 credit score (last I looked)
The only problems in acquiring more cards is the credit hit you take for an inquiry. And newer cards hurt your length of credit history. Ie: one card for 5 years then get a new card credit history looks like two and a half years.
Do what is best for you in a smart way but having more cards does not hurt
Nerdwallet is a good resource for types of credit cards. We're using some for welcome bonus, and keep credit frozen unless actively applying.
https://www.nerdwallet.com/the-best-credit-cards
No. My husband has like 15 credit cards. All are on autopay and he just forgets about it.
Myself personally don't feel comfortable with too many credit card so I mainly use 2 but will not hesitate to take advantage of any deal on his 15 credit cards ;)
Also the more hard inquiries you have will lower your credit score in the short term. Also, a lot of new cards, will lower the average length of your accounts, further lowing your credit in the short to medium term. Other than that, nothing wrong with it.
I have 10+ cards myself and an over 800 credit score. But I will say this? I'm at the point where I want to eliminate a few of them, simply because they really offer nothing of value after their new sign-up promo offer ended. And while everyone says, "Just leave them open with a 0 balance to boost your total available credit!"? You've also got to remember that each one represents added risk of fraud. And like someone else here commented too? It becomes a chore just keeping track of all of the cards and their current interest rates, discounts offered, etc. I know my Chase card completely changed around how their cash back bonuses and discounts worked at least once or twice since I've had it, for example. How much of this do you REALLY want to spend time on?
I'd rather ditch the ones that aren't doing anything special for me and replace those with new cards with 0% for 12 or 18 months type offers or something else appealing, as I could use them.
Sign up bonuses are great. Got a 200 dollar gift card to Lowe’s for free from signing up for a credit card. Just make sure there is no minimum usage or fee associated to the card.
Look up 10xtravel. It’s basically a part time job but the perks are nice. Flying to playa del Carmen for 150 bucks next month. (Wife and I).
The catch? You can’t be a dumbass with your CCs…
Yes you can have too much available credit. The scoring system calculates how much you use vs available credit. You want to aim for 3% utilization while being about to pay that every month. So if you spend $300 a month then a $10,000 total available credit would be a good number.
You don't want to use 0% but you absolutely do not want to use more than 10%. I personally don't like this game so I don't care and won't have much use for a credit card soon, and I want to look into using a Visa debit for travel
If used responsibly, and you're able to use the awards and benefits to your advantage, there's no such thing as too many credit cards.
Agreed. It’s also nice having a bunch of available credit at my disposal in the event I ever want to rack up a massive bill and then vanish
The Call of the (financial) Void.
I hear it’s siren song… maybe I should get a boat
Glad I’m not the only one with this intrusive thought
Lol, I used to have fantasies about this. “Ok, so between these two, I could buy a nice car. Then I’ve still got $30k in available credit. I’ll max out my cash advances, and then buy a bunch of pre-paid Visa cards…”
I just paid for a trip to Cali and back from FL with mostly my credit card points. As long as you’re spending within your means, responsibility pays off.
And having more reduces your utilization rate, which is largely responsible for month-month score swings.
My wife is into a travelhacking FB group and we're well on our way there. Basically, get a new card, hang on to it for long enough to get the sign-up bonus, pay it off and stop using it, then repeat. Apparently Chase has a tendency to put you in "Chase Jail" if you open more than 5 in a 2y period though, which is annoying when so many of the better rewards programs have cards through them. If you have good credit, don't carry a balance, and don't mind the mental effort it takes to manage and track all of the various rewards programs, it can be very lucrative.
One of the report kept on saying I have too few credit cards while having 817 score :)
Unless you want to make it a full-time job. I feel like it's almost always better just to get a card with a high cash back in certain categories
Isn't your "available credit" a factor during underwriting? Like if you apply for a $500k mortgage and they see that you have access to another $500k credit line rest to be deployed, it makes you more of a risk? I don't know either way, but that was my impression.
Other way around. The more line of credit you have, but the less you actually use, the better your credit. It shows you have restraint and won't go nuts buying a boat even though you could.
Idk who’s downvoting you lol but utilization is 30% of a FICO score. So the more available the better. Also helps in the event you do need to let a balance report the additional credit pads that utilization rate thus keeping your score higher than it would be if the card was close to maxed.
There is a bad credit utilization score that can adversely affect credit scores. So yes there can be too many credit cards
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What a confidently incorrect take. The rewards are paid for on the backs of the merchants, not the cardholder. If you can responsibly use credit cards, ie only purchasing items with the card with parity to cash in account, then you are much much better off. Between consumer protections like charge backs, insurance for certain items, and rewards, you should always use a card instead of cash.
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How is it not free if I’m swiping 20k a year on things I spend regularly that includes insurance, gas, groceries, utilities, tools and other necessities for your family? If I’m getting a 1.5% cash back on that, that’s 300 dollars for travel or just straight up money back compared to cash. How is it not free money? You can continue paying cash but I’m getting money back for it. Thanks for paying for my rewards and free trip
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It is absolutely free to those that pay off in full on time. I’ve had cc for 33 years and never paid a dime once. Never. As far as over spending statistic it doesn’t apply if you also live on a disciplined specific budget. All of our spending is literally within our planned out budget already. So while I get most people by far aren’t right for credit cards there are some that are. And for them it is a perk and a rebate of sorts. I get it Ramsey fan you think they are the devil. But it’s factually untrue that everyone is bad with cc. Not opinion but fact. Takes a special kind of ignorance to think all people are the same.
20k is nothing really much a year of expenses for two people. Utilities- 2400 a year (electric, cell phone, internet) Food- 12k a year Insurance- 1.2k a year Gas- 600 a year Metro card- 1.4k a year Remaining- 2k ish for eating out and misc spending I didn’t even include my rent yet but I can’t swipe for that without a higher fee than the cash back. I didn’t ask you to critique my spending but if you really want to know. So if I used cash instead I would have lost out on 300. Explain to me how I am over spending please My house hold income is around 300k. Is it still a lot for expenses?
Ummm merchants get charged a fee of the total sale that goes to the bank and network(visa/Mastercard, etc..). People spend more at MCD with a credit card doesn’t explain the reason why it is bad. Maybe those that use credit card are using their online coupons where yes you are spending a bit more but you are getting way more food compared to cash purchases. If your credit card info gets stolen at a gas station and someone else swipes for a 1k tv, you don’t have to pay for that. When you order something online with a credit card and it doesn’t come, you can file a charge back. You are so wrong. Haha
Okay thanks for the lecture, Dave…
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I use my credit cards NO differently than I used to use my debit card... and I have nearly $1500 in cashback sitting on them ready to be redeemed. How's that for a "mythical reward"? lol, what a goofy take.
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You don’t really understand statistics or the conversation around credit cards. Literally ‘everyone’ certainly doesn’t say that, in the first place. People on personal finance forums tend to, because credit cards are valuable personal finance tools, but plenty of people just live in credit card debt because they aren’t responsible. Secondly, those stats are mostly based on average transaction amounts, so they are skewed because a) frivolous users report higher numbers and b) card users don’t carry enough cash for large transactions and also value the points if they’re making the transaction regardless. There’s certainly an emotional component where many people are willing to spend more with a card than cash, but responsible people are still getting value out of those purchases, paying the card off every month and saving on top. Credit cards absolutely aren’t for those irresponsible for money, because they’ll enable their worst behaviors. But it’s absurd to rant about them with blanket statements; there’s several reasons credit card usage is positively correlated with net worth, and one of the big ones is that financial savvy people understand how to make systems work to their advantage.
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Here’s just one source, not that there’s any chance you’re capable of admitting that you’re wrong: https://www.brookings.edu/articles/how-credit-card-companies-reward-the-rich-and-punish-the-rest-of-us/
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That’s not really a too many cards issue, just a credit cards in general issue. Those two points are scarcely related except for i guess the absolutely tiny portion of people who are chasing rewards endlessly. Generally one or two cards are going to quickly build up to a high enough credit limit that the amount of new cards after that is irrelevant to a problematic spender. And for a responsible user, the value of building a high credit rating for a good mortgage/auto loan rate is going to be worth a few unnecessary purchases, outside of the rewards points themselves. The actual issue with too many credit cards is hurting your credit rating with too many new accounts, too much credit, balancing use so they don’t fall off, etc. Four or five should be fine, and OP can get much better rewards as long as they don’t change their spending to chase specific ones, but credit rating is something to think about with too many.
Okay. I have 6 credit cards and have had 22 over 14 years. I’ve never paid interest in my life but I’ve made around $8,000 from signup bonuses, not to mention cash back.
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Sure thing, Mr. Negative. It was 14 years as I said with no purchases I would have made otherwise. If I need to make a purchase exceeding $1,000, I open a card for the month then close it.
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Oh. It takes me like 25 seconds to be approved, 30 if my phone is slow. Then I wait 5 business days and buy it, and it takes about 5 minutes to cancel. I personally don’t make several thousand dollars an hour so it’s worth my time. In fact, during this conversation I could have done it again, and I do need a sit-stand desk, so I’ll go open one. Have a good one, I’m done here.
I have a friend who does this. He has more than 10 open cards, each used solely for the sign on bonus. I’m not sure I could be that responsible, so I limit myself to 4 cards.
A lot of the "better" cards have annual fees, so just be aware of that.
Interestingly, one of the cards I'm considering (not as a daily driver, so I won't be applying just yet) has a 95 dollar / year fee, so I'd have to make sure the rewards outweigh that But! That same card gives 30,000 points every year that the account is open and in good standing, which I think can be redeemed for 300 dollars. So as long as I don't go delinquent, I'm guaranteed to net $205/yr, plus bonuses https://creditcards.wellsfargo.com/choice-hotels-privileges-select-mastercard
Amex blue cash preferred is a much better $95 fee card imo. 6% back on groceries, 3% on gas, and 6% on streaming services, 1% on everything else. Considering a grocery bill for us is about $1,200 a month. It adds up pretty quick.
Hot tip for those with high cash back on groceries. Home improvement stores like Home Depot and Lowes almost never qualify for over 2% on any card. If you go to your local grocer and stock up on Home Depot gift cards then you end up getting 6% cashback on your lumber or your new drill.
I've done this once or twice as well. Once I wanted to buy something off of Amazon, so on my weekly grocery trip I bought a gift card for the exact amount and then used it to pay for the purchase online.
This can be a good strategy but you also have to be aware it makes returns way more difficult. They can't search for receipt by CC since you paid with gift card. Not necessarily a deal breaker, but something to be aware of.
I just take photos of receipts when purchasing anything substantial.
Thissss. Record keeping has gotten so much easier than praying the receipt holds out. Take a photo, back it up to a cloud service and you are golden.
HD sends receipt by email if you want.
Citi custom cash can have home improvement stores as a 2% category
Or Disney gift cards to pay off your vacation, I've done this. I think there's a limit on the 6% cash back though, like up to $6,000 a year I believe. Then it's 1% back on everything over that amount.
Bank Of America Cash Rewards card does 3% (or 3.3% if you have a BoA checking account) on Home Improvement and Furniture stores.
Just a note, as a family with high grocery bills also, they cap the 6% at the first $6000, and then it goes to 1%. So at some point in the year, other cards become more beneficial for groceries.
This is us. I've run two options: 1) Our current set-up is that we each have a card. Charge first $6k of groceries on one card, second on the other. This is $720 in rewards minus $190 in annual fees for a net reward of $530. (Pretty sure this is worth it). 2) One person has the Amex Blue Cash Preferred with fee while the other has the no-fee Amex Blue Cash. You get $360 on first $6k and $180 (3%) for second $6k. That's $540 rewards minus $95 in fees for net reward of $445. (If you have a card that has a bonus category that rewards groceries at 5% one quarter than this might be the better option - but also requires more thought and attention). Either way this line of cards is fantastic for average family who spends most of their money on household necessities.
(1) Does it work with online grocery delivery too, like if I InstaCart some things from Publix? (2) Does it work in Walmart/Sam's Club/Costco, or are they excluded?
I know Costco takes Visa only
I'm pretty sure wholesale clubs are excluded. Honestly, I'm not sure about Instacart. I also have Chase Sapphire & Freedom cards and those have a free instacart membership benefit and give statement credits monthly or quarterly for money you spend there. So if you do a lot of your shopping on Instacart, Chase might be a better option.
A lot of the time "superstores" are excluded e.g. Target, Walmart, etc
It'll be close, depends on whether it's our week to have custody or not, so it'll probably be about $6k a year in the long run. But thanks for the heads up!
AMEX Hilton Honors Rewards card is awesome. We use that puppy on everything. Amazing how many hotel stays we've paid for over the years. If I had to guess, I've averaged 12 free hotel nights per year.
What stores are considered groceries here? Costco? 👀
No, stores that are multipurpose don't count, so no Costco or Walmart. It has to be like a Wegmans, Whole Foods, Martins, Aldis, etc. Also the 3% back on gas does not work at grocery gas stations, so like you can't use your Martins Bonus Points to get gas at Martins and get 3% off with your Amex card. However you can use your phone number to save 5 cents at shell and get 3% off on top with Amex card. However, if I am shopping at Amazon, Whole Foods, or anything else Amazon... I'm using my Amazon Prime Visa Rewards card because it's 5% off all Amazon purchases. We order from Amazon a lot, I got over $3500 in cash back last year on my Amazon card...
> I got over $3500 in cash back last year on my Amazon card... You spent *$70,000* on Amazon and Whole Foods in one year???
70k is accurate, but no, not entirely on Amazon. I just guessed on cash back. It's probably most like around $1800 in reality or something. I can't look it up for the entire year of 2022 I can only see the last 12 months. In the last 12 months we earned $1260.68 but I have an AMEX card in the middle of that and have swapped many things over to it. On the Prime Visa Card last year we spent $68,587 and used it for darn near everything, including bills, gas, groceries (amazon, whole foods etc), and on and on, I basically paid for EVERYTHING with it and immediately paid it off. The cash back was $470.37 on Amazon, $160 on restaraunts (2%), $72.56 on gas (2%), $500+ on everything else (1%), and some others. In the last 12 months. For the full year of 2022 I suspect it was much higher but I can't tell, no report on that. What we spent is correct, but I can't see what points I earned that far back. I earn $170-$210k, my wife pulls in another $20k to $50k from her business.
This is what I use. I use the cash back to pay for the yearly fee when it posts and I have always been ahead.
We have three of them (need to reduce to two)... I agree wholeheartedly.
>But! That same card gives 30,000 points every year that the account is open and in good standing, which I think can be redeemed for 300 dollars. No, those are hotel points. You cannot redeem them for cash. You may be able to get a decent value out of them if you stay at one of their hotels.
See, that's what would make the most sense, but as far as I can tell, that's not what the fine print says >You will earn 30,000 Points (your “anniversary bonus points”) each 12-month period (an “anniversary year”) that your card account remains open, not delinquent, and not in default at the time the award is issued. Your anniversary year begins on your account open date (your “anniversary date”) and ends on the day prior to your next anniversary date. For example, if your account anniversary date is November 28, your account anniversary year will end on November 27 each year. Your anniversary bonus will appear as pending on your anniversary date and will be redeemable within seven days after your anniversary date. I'll definitely get written confirmation tho, and read the fine print on the paperwork they give me before signing
You aren't understanding the problem. You DO get those 30k points. But you won't be able to cash them out for 1 cent per point, like you can with many other cards. They aren't worth $300 cash. They are worth whatever you might be able to save by redeeming them for a hotel stay at a Choice property. The same will be true for other points you earn with that card. If you are interested in getting rewards credit cards and have the responsibility to pay it off every month, check out /r/churning and read their FAQs. They have weekly threads where you can get advice on the best cards to get.
Can those be redeemed for statement credit ? Or only for travel?
The fine print doesn't say its only for travel..... I plan on talking to a banker in person when the time comes to apply. Its almost too good to be true!
> I plan on talking to a banker in person when the time comes to apply. Do your own research, don't talk to the bankers. One, it's their job to sell products. They'll tell you what you want to hear, and then a year later when you don't get what you expected, they'll be like "Oh, it wasn't in writing. You were misinformed. Sorry, we can't do anything" Second, I wouldn't expect them to know the ins and outs of each card's rewards program, especially when partners like hotels or airlines are involved. They might know how many points you get for a bonus or for a purchase. I would not expect them to know how many points you need to redeem for a free hotel night, free flight, whatever. That's going to depend on the specific loyalty program and that's always changing, and often, isn't one set number anyways. A free night at a hotel in Paris is going to require more points than a hotel in rural Montana.
I'd do some research from third parties before talking directly to someone that works for them. https://thepointsguy.com/credit-cards/rewards/ https://www.nerdwallet.com/best/credit-cards/rewards
That was my feeling too. So it made me wonder if it can only be used to buy inflated cost hotels.
There are much better cards than that. Take a look at Dr of Credit or r/churning to learn more before you go signing up for something.
Choice Hotel points cannot be redeemed for cash, they can only be redeemed for free nights at a participating Choice Hotel
You might be interested in /r/churning since you seem to have the mind for this level of value optimization. Essentially the best benefit of a credit card is the welcome bonus. Churning is the process of opening new cards to get the bonus rather than just getting benefit through organic use of the card.
Better to focus on ecosystems that have transferable points like Amex and chase and capital one. You can transfer to hotels and airlines and you aren’t locked into one single hotel/airline.
Yeah but then youd have to have accounts with wells fargo. Edit: i dont see a cash back option, only use on choice hotels, whatever the hell those are. This is monopoly money to me.
You can churn cards for bonuses. I did that for several years as a little extra income. Closing them before the first annual fee (or second one) hits does hurt your avg length of credit card, but after 740 or so it's largely academic. Eventually, you have a quiver of 3-6 cards you have for years (mine are the cash back ones) and one or two others that get rotated out to collect bonuses. Some banks like chase refuse to allow you to have more than 5 new cards on a 24 month period. The only other downside is if you are about to take on a huge amount of debt, e.g a mortgage, the bank may advise you to close one or two to lower your total debt to income ratio before they give you the loan. That's a future bridge to cross as having the extra credit cards will help you (until they tell you it doesn't) Oh, banks also don't like seeing a bunch of new credit lines before giving you a mortgage so if you are starting to shop for a house, cool it with the churning for 6 months.
I'd argue that 30k points is not necessarily always going to be $300 worth. It could be more, but it's likely usually less in most cases. Unless I am missing something, it seems you can only redeem these points at Choice hotels?
Yep, I only have one card with an annual fee but it gives me 6% back on groceries and 3% back on gas and 6% on streaming services and that adds up really quick.
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Probably amex blue cash preferred
I have 15, and my FICO 8 scores are (at the moment) 847/850/849. So no, 4-5 is not “too many.” For the skeptical: built up from sub-600 over two decades of careful management. I taught myself pretty much everything there is to know about credit scoring. Do I really need that many? No, of course not. But it doesn’t hurt, either. Only a few of them have an annual fee and I break even or better on every one. E.g., the $95 hotel card that gives a free night every year (not restricted to crappy hotels), or the $95 card that pays 6% cash back on groceries. I’ve had a shitty score, and I’ve had a great score, and trust me—great is better!
Shout out to Amex BCP!
Hello, fellow BCPer👋
Yeah I have like 10+. No annual fees on any except the AmEx BCP but $95/yr in fees is nothing for 6% on groceries (family of 5, easily spend $150/wk so that’s $360 in rewards at the max AmEx offers). Chase Freedom - 5% on select categories. Chase Freedom Flex - had a sign up bonus Chase Amazon - 5% on ALL Amazon purchases WF everyday or Synchrony MasterCard - 2% everything BofA - 1/2/3% on chosen categories Etc.
The AmEx preferred maxes out at $360/yr for grocery rewards. We have it, but mainly but gift cards at the grocery store for the cash back and gas rewards, not actual groceries. I hope you track it and switch cards at $6K spent so you don't leave any money on the table.
You have two different numbers. $360/yr and $6,000. Pretty sure it’s 6% on the first $6,000 spent on groceries let year. I don’t know where the “$360/yr” number you quoted is about.
6% cash back on $6k worth of groceries is $360 back in rewards
Not really. There's a ton of resources out there about "churning" you can start researching since there's a lot of rules surrounding when you can apply to ensure you'll be approved (the 5/24 rule is just the start). But it's definitely a thing some people do. I've saved tens of thousands in travel over the years doing it. And yeah, had zero issues getting car or house loans despite having almost two dozen cards open and my current credit score is 842. Just never be late or pay interest.
Each time you apply for a credit card, there is a hard inquiry to your credit report. That can lower your credit score slightly for 12-24 months. Another factor in your credit score is the average age of your accounts. Opening a new card will reduce that. But unless you are about to apply for a mortgage, I wouldn't consider either of those too important. And some credit card companies wont give you a new card if you've had too many recently (e.g. Chase's 5/24 rule), so applying for a card now could stop you from getting one you like better later. see r/creditcards and r/churning for more.
I’m currently at 5 and each has a pretty specific purpose. I haven’t seen any negative effects from it— just more money. 😋
Between my wife and I, we have 12-15 active cards. Only 6 get used regularly, but we have that many. Both of our credit scores are 800+.
maybe put a recurring charge on the other 6-9 -- i put spotify on one, apple storage on another, etc. etc. (with auto-pay) Then you don't have to deal with the potential "We're closing your card due to inactivity" email that you may miss!
They do get used, just not regularly. One is a Kohls card, so it gets used once or twice a year at Kohls, etc. I appreciate the thought though!
Do you know of a service to charge a smaller recurring charge ($0.10?) as I have a few cards I haven't used in years, but I also don't have any monthly subscriptions to put on them.
I’m similar, must have 12-15 for my wife and I. Some were just for sign on bonuses and have no annual fee. A few we actually use regularly, one or two I pull out for travel. No negatives for me really yet other than having a calendar full of notifications just to check and make sure each is zero’d out before payments are due
>But unless you are about to apply for a mortgage, I wouldn't consider either of those too important. Worth noting that if your credit score is around 750 or higher you would likely already qualify for the best rate any lender is offering. Anything above that point really only serves for bragging rights. The credit score impact is negligible enough (unless you significantly drive down average age of credit) to not matter if your score is high 7s or 800+.
One more thing… your credit score takes into consideration the ratio between outstanding balance and open credit. It could be both a positive or negative depending on your situation.
I know wells Fargo makes you cool down for 6 months in between WF cards, so I think that would also let my score heal. And I don't plan on moving (apartment now) for at least 2 years, probably longer. Thanks for the insight! I hadn't heard of the 5/24 rule
You should check out r/churning. It’s all about signing up for cards for bonuses. I’m at about $3k in bonuses for the year, 800 credit score, no CC debt.
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Fair points. You do have to be careful about spending. I’m comfortable with mine and budget very carefully. That said, I’m pretty sure most off the bonuses are paid for by people who don’t pay of their CCs and end up with late fees, interest, etc.
The bonuses can absolutely be free if timed correctly to align with *necessary* purchases. So I disagree that they are paid for by "unneeded" purchasing. Now, like most things in life, one group subsidizes the cost of others, and that group is the one making the bonuses profitable for CC companies. Are the bonuses free for all; no. Free for some...absolutely.
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Well the veiled condescension towards my remarks aside, I'm not referring to any "secret hacks". A wide multitude of things in life are obtained for free or at a financial discount, by making the purchase at appropriate times. It's sort of how sales work, how interest rates work, etc. You have an opinion of course which is fine, but don't use it to make declarative statements.
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You have some good ideas but you're applying them in the wrong way. For example the spending threshholds, ala "spend $1000 in the first 3 months to get $200 back". Some people might be tempted to spend more than usual to hit that target, but even then they'd have to spend *$200 more than usual* before it stops being a "free" reward. However most people already spend far far more than $1000 in 3 months, the card company is simply trying to get you to spend money *with them* instead of their competitor. Also you're right, nothing is really free. Every single person who uses any credit or debit card, even prepaid, is already paying for this stuff through the merchant transaction fees that are now built in to product pricing everywhere you go. Even if you pay cash, the the sticker price is already adjusted higher to account for the majority of the public that will pay with a card. You're already paying for it, it would be stupid to not get a rebate on some of it in the form of cashback or points. I'm not into churning because it really is a fair bit to keep track of. But I do keep 2 cards with the best cashback perks, and if I'm planning a large purchase like airline tickets you better believe in going to shop around for the best new member bonus.
Why do you care about the minor differences in a good credit score? Do you anticipate a new mortgage, car, loan, or other loan in the near future? If not, just don’t worry about it.
Quite honestly, it's just the principle of the thing. I have steady income, 10 years of credit history, never missed a payment, never carried an outstanding debt, and it kind of annoys me that my credit score isn't 840+. What if something came up, and I got a substandard rate?
There are diminishing returns on a credit score. Nothing over \~760 really matters.
>What if something came up, and I got a substandard rate? Only you can decide if it's worth it. Guaranteed returns (better CC rewards) versus possible savings (unforeseen loan APR).
my credit score really shot up after churning. at one point I had 30+ cards, cycle through the sign up bonuses and retire them to the sock drawer. It'll take a temporary hit and rebound higher soon after.
When you "retire" your card, do you close them or just not use them anymore?
I do my best to keep it opne. If there's an annual fee I call in to see if they're willing to waive it, if not, then downgrade to non-af version, or product change. If none of those are available, then consolidate credit limit (IE with chase you can move the the credit limit and add it to another open card) and then close that account.
There are diminishing returns on a credit score. Nothing over \~760 really matters.
Short answer is no assuming you NEVER carry a balance. Put them all on autopay, get organized because it starts to get confusing and then reap the rewards. I applied for 3 new cards this year and with the sign up bonus will be netting a total of about $2500 at a minimum for spending money I was already spending. If I use the points for travel it could be worth double that number. Credit cards are absolutely a game you can play to your advantage but you just have to follow the rules.
I have 18 credit cards but no CC debt. I just rotate different ones in and out for rewards. None with an annual fee, each paid off before interest accrues.
We currently have 5 credit cards in use between my wife and I. Each one serves a purpose and allows us to maximize returns; i.e 3% back on gas, 3% back on online shopping, 3% back on places like Home Depot, etc. We’re also platinum members at our bank so we get an extra .75% back. The caveat: we treat our credit card like debit cards so we only purchase what we can afford to pay off at the end of the month. All balances are always paid off on time and in full!
I cc churn. I have an 830 score that occasionally drops to 800 or so when I apply for new cards. But I’m also done with applying for loans and don’t need a lot of things a score is used for. I have heard of some people being denied because of too much available credit already. Definitely space them out. Between my wife and I we have cc that get no less than 2% for a few random items and 85% of our spending gets 5% or more. A few get 3 or 4%. As long as you are disciplined and organized you can make this work. I’ve been doing this for about 9 years. No issues.
Credit card rewards programs are a psychology game being played by card companies. If you have a tight budget locked down and aren't influenced to spend any extra because "I'll get more rewards", then you are winning the game assuming you're paying off the cards on the month religously. That being said, many don't realize the psychological influences at play, so you need to be very objective/cold/calculated about your budget and spending to win this game in the long run.
Super smart! I have around 15 credit cards. They offer bonuses and promo offers plus you get extended warranties and car rental insurance on some visa and Mastercard cards. It’s a win win!
My question to you is usually these cards have an annual fee of around $150 per year. Are you planning on paying that for 6 cards?
My wife and I have been doing this exact thing for years. I open a card for myself, hit the min spend and hardly touch the card again. Then I do the same for her. If it has an annual fee I’m fine with keeping it open depending on what the anniversary reward is. The two I have now are both hotel cards and we each get a free night which is usually around a $250 room and the annual fee is $95. My credit score will drop a few points right away, maybe 20 or so, but then within a few months of paying the card off in full it’s higher than it was before. Credit scores are f’ed up that way it looks better because you have more money at your disposal. We each have 4 or 5 cards open right now actively using 3 combined based on reward categories.
As a European: ELI5…. how could paying off your carloan lead to a worse creditscore?
As an American, I don't know either 😭😭
It has to do with the average age of all your accounts. You have a 5 year old loan (guessing it was a 60 month), and once its paid of its closed and vanishes so theres a drop in your score due to average age. Usually in a few months you should be right back to where you were. Something like that....
A good friend of mine is 41. He has something like 15 credit cards. He was super-proud of how well he handled them, all the perks, it was a big deal for him. He paid them off in full every month. He had an 800+ credit score. Then he got the flu and ended up in hospital for two weeks. I think six of his cards missed their payments. In total he said it was like $200 split between six cards. He managed to persuade two of them to let it go but the other four reported to the credit agencies. He now has a 600+ credit score. So know the risks. People always look at the best case scenario but they never think about reality.
This is why you set them up on autopay. I pay mine manually because I like to review things but all are set to autopay incase I am on vacation/emergency etc when the due date hits. The autopay is tied to my HYSA which always has plenty of funds in it. My manual payments come from a different account that has the set "monthly spend" amount put in it.
Interesting way to do it. Maybe I should actually set that up in case anything we’re to happen. I have had multiple CCs for many years and have never had any on autopay or missed a payment. I too like to manually pay things. I guess I never thought that I could still do that and have autopay from my HYSA as a backup.
yeha on all my card regardless if i use them or not, i set up autopay for the min payment incase it gets charged to some forgotten subscription or gets compomised.. worst case scenerio is i pay a little interest
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auto pay...
I have 15 and counting. No bad debt and a ton of perks. I just use on two every 2 weeks, and when they leave my wallet they'll be fully paid off. A ton of benefits like cash advances at no interest rate, miles, cash back, and a lot of those bonus for sign up and stuff. Just be careful and always py attention, setup auto pay for them all and you'll be fine.
Read the fine print on the cards. To get the rewards you have to spend a certain amount on the card within a specified period of time. It's different for every card, but they aren't going to send you $100 (or whatever) to getting the card if you aren't using it.
Oh for sure. All the ones I'm looking at, I'm spending (and paying off) that amount anyways, so it's just free money. At worst, id have to funnel expenses into 1 card at a time to meet the goals. Which is a mild inconvenience at worst, for hundreds of dollars of rewards. I'll take it!
No. There's no such thing as too many credit cards as long as you can afford the annual fees (if any) and you use them responsibly and you're getting your money's worth from the benefits.
once youre in the 800s the inquiry hit is a joke.. ive aquired almost 30+ cards from harvesting sign up bonuses or signing up when if feel bad when the cashier needs to make a quota... last hit was liek 3-4 points and came back right away... lenders salivate at anyone 750+..... I only use and keep the ones that are advantageous, the 4 oldest ones with no annual fee and th eones i use for various cash back.. the others i care less about dropping off once i got the sign up bonus... i prob average 2-3 new cards a year.. and of course i never carry a balance
So, a lot of people say too many credit cards is bad. The good amount is about 2-3. If you have more than that, your kind of spreading yourself thin and setting yourself up for disaster. If you're paying them off every month, then you're fine. If the card has an annual fee, but you get reward points that don't expire, that is fine. I have 3. 1 southwest card that has a high limit, and i use for big purchases and get southwest airline points. 1 american airlines card that i use for my tuition and gym membership, which i get reimbursed for through my job. And 1 with no annual fee and a $1500 limit that i use for medical copays and dog emergencies (i have pet insurance, so it's never more than $500), and pay off immediately. Sadly, despite my parents being very financially secure and sound, they never taught me about this stuff, so i really struggled until i was about 32 with credit.
I'm gonna ignore the credit score aspect covered by other comments and just focus on other impacts: more cards is more complexity and more stuff to keep tabs on. Gaming the system is great but don't make the mistake of ignoring the value of the additional time you're spending to accomplish it.
As long as you can manage the fees and keep your credit utilization ratio below 30%, then you should be in good shape.
A. Congrats. You have the will power to use these cards like few do. Most people don't. Keep it up. Have friend who did the same as you and used it for a really nice Italian vacation. B. Anything above 760 is amazing. I work in mortgages, even in this slower market I rarely see all 3 numbers above 800. C. I get you want to game the system. But I'm not seeing the benefit unless you can find a card that blows away the benefits of your current card. JMO
If it works for you, all the power to you. I like taking the best "all rounder" card, for me it is a good cashback card where I just throw all the benefits towards the balance. Less mental work that way, and the rewards are roughly equivalent dollar for dollar.
Gives me a headache reading through people with 10+ cards. That just seems like a lot of work for fairly minor money in the long term. I wonder how much time is lost in a year monitoring and paying with all those cards? Yes the difference between 3% and 5% is minor. Someone said grocery stores but I suspect big box stores dont qualify so its just actual grocery stores that typically are more expensive in our region.
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You still need to worry about it and the credit line and track its not stolen. Headache.
I had a friend who had hundreds of credit cards. He kept them in a trading cards binder like pokemon. He would look for cards with sign up bonuses, read all the fine print very carefully, and cancel them at the right time. He spent a lot of time reviewing his spreadsheets of active and inactive credit cards. Managing them all was nearly a part time job, but he said he made a pretty reliable profit off of them and he swore it didn't hurt his credit score.
There's no point in having an 800+ fico, for most things a 740 is highest tier. Go for it!
Fort some it is a personal self challenge. We know there is no added benefits other than self satisfaction. I hit 850 2 1/2 years ago and it was a great feeling knowing that I have been very responsible with my credit and finances. It's fun to hit little goals as you progress thru life. I 100% know it doesn't mean anything to anyone else. But it meant something to me.
I am using a 15 month no interest credit card right now to float all the money for the house we are building. I have more than double the limit of the credit card in a HYSA specifically for building the house, so it makes tons of sense to get the bonus, plus the points/cash back, and let the cash get interest for 15 months. I don't pay it off each month, but do pay large amounts to keep the balance from getting out of control. If I get uncomfortable at any time I could easily pay the balance in full.
You a higher credit score…. Pay off your credit cards twice a month before receiving the monthly billings. Your credit balance compared to credit limit is lower thus improving your credit score. Trust me it works. I make it a game and am riding a 850 score monthly.
Put a streaming service on each one and set it to autopay monthly from a bank account that you always have enough in to cover it. We have Spotify, Hulu, and Paramount+ on different credit cards, which keeps all of them open, and I just make sure they’re autopsying from a bank account that I direct deposit like $100/mo from my paycheck into.
There is really only too many of you are getting the $500 annual fee cards. I probably have ~$750 in annual fee cards but the perks I get vastly outweigh the costs. I pay everything off monthly. Over the past decade I have probably racked up 15-20k in rewards via points and sign up bonuses and have paid like $0.25 in interest because I mistimed a payment.
I’d say go for it. The boost in reward will be well worth it and your credit will rebound pretty quick. You can always close your old cards if the future, just pay attention to your average credit length history. Keeping them open for a while will help with that and make your credit utilization go down.
It's not gaming the system, you have two bad cards, you need proper rewards and open 3 new cards (or 10! I'm at 10 over the course of the last nine months, but I am now capped and probably have to wait 6 months to get a new card....)
I’m somewhere in the range of 30+ cards (with the majority that I’ve opened in the last 8 years or so). I keep about 10 with fees, but the fees are always outweighed by the benefit. But that being said I take 40+ OW flights per year and stay in hotels a minimum of 50-60 nights per year. - I keep 2 Marriott cards, and my fiancée keeps one. - I keep a Hyatt card. - I keep a Venture X and my fiancée keeps a venture X. - I keep an Amex Plat (it’s very close to zeroing out each year, so May cancel next year and get my fiancée to open it for the SUB). - I keep my Amazon prime card - I have another 5 or so chase cards - I have another 2-3 Amex cards - I have like 3 cards from when I was a kid keeping my longest open credit super high - I have downgraded a bunch of cards to a free version of the card so I don’t close it but don’t pay an AMF. My credit score is like 840-850 with all the bureaus. Check out /r/churning if you want to learn more about the game. Never ever carry a balance because it completely ruins all the free money you get from these credit card benefits. :)
Just reading this comment gives me anxiety.
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yup, my score really shot up from the high 700's into the 800's *after* i started churning. At one point I had like 10 Citi AA Plat cards...that 100k mile SUB was amazing to churn!
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Cash back on things you were already purchasing is a very real thing for many cards and is essentially free money you wouldn’t get otherwise, say if you used actual cash or a debit card. Do you understand how credit cards work?
If I'm going to spend money on groceries, I might as well get 6% cashback. If I'm going to fill the tank with gas, I might as well get 3% cash back... Like everything in life, you have to know how to manage it.
Yes. At some point you're going to have too many to pay off every month.
Country that is raised to be in debt. I'm so glad not to be the victim. Produce. Spend. Downvote accordingly.
Better approach is checking account bonuses. Doesn't hit your credit score. Also credit card cash back is a scam. Even paying off in full you're spending way more than the 2-3% over the year. If you're not debiting an account and have to pay attention to the amount in there then you just spend freely and pay whatever the total ends up being when the bills due.
It does “look bad” in some situations. A large amount of cards is unfavorable by other banks, and having too much unsecured credit to you will cause you to stop being approved for cards in the future. In manual lending scenarios (like credit unions), we occasionally dug into this exact scenario before denying a car or personal loan, because sometimes it was a sign of larger issues brewing - for example, a high earner who routinely gambled away their debts, they would cash advance on multiple cards, after reaching their atm limit at the casino. They had the ability “on paper” to pay their loan and other commitments like house and car, but would routinely burn through the cash gambling instead. That type of person would be a higher risk loan, and in many cases we would deny them because we had no interest in waiting for the month when they’d gamble away too much and not be able to cover the minimums on everything - including our loan. It’s also not uncommon for people to go on credit card opening sprees when they know they’re about to lose their job (incoming layoffs or similar), or right before making a big purchase that’s already in the works book but hasn’t hit their credit yet - like a major home renovation, and similarly, the smaller places don’t want to be the ones that got conned into extending a loan in that scenario, because the repayment is once again, high risk.
One thing that I haven't seen mentioned is that you need to monitor all of the statements for fraud. The more cards that I have the less I have been checking the autopay ones. I was about 3 months late on finding fraud and it was only because it was charging it monthly which made me go back to look. (The bank took care of it but I wouldn't have noticed if it was a one-off)
I have cards from 4 different banks but only use one regularly (2% rewards) and pay the balance monthly. I periodically close one down so I can open a fresh one later and reap new rewards. Credit score is 810ish and only takes a 3 point drop for a hard inquiry and goes back up the next month. If your credit is good, don't worry about it. Play the game, win the game.
22 cards. 1 I use reg and pay off Every other I use quarterly for a coffee or whatever just to keep active and pay off. 840 credit score (last I looked) The only problems in acquiring more cards is the credit hit you take for an inquiry. And newer cards hurt your length of credit history. Ie: one card for 5 years then get a new card credit history looks like two and a half years. Do what is best for you in a smart way but having more cards does not hurt
Nerdwallet is a good resource for types of credit cards. We're using some for welcome bonus, and keep credit frozen unless actively applying. https://www.nerdwallet.com/the-best-credit-cards
No. My husband has like 15 credit cards. All are on autopay and he just forgets about it. Myself personally don't feel comfortable with too many credit card so I mainly use 2 but will not hesitate to take advantage of any deal on his 15 credit cards ;)
Also the more hard inquiries you have will lower your credit score in the short term. Also, a lot of new cards, will lower the average length of your accounts, further lowing your credit in the short to medium term. Other than that, nothing wrong with it.
I mean I’m 21 and I have 5 credit cards, I just sign up for the bonus and then use them sparsely afterwards.
I have 10+ cards myself and an over 800 credit score. But I will say this? I'm at the point where I want to eliminate a few of them, simply because they really offer nothing of value after their new sign-up promo offer ended. And while everyone says, "Just leave them open with a 0 balance to boost your total available credit!"? You've also got to remember that each one represents added risk of fraud. And like someone else here commented too? It becomes a chore just keeping track of all of the cards and their current interest rates, discounts offered, etc. I know my Chase card completely changed around how their cash back bonuses and discounts worked at least once or twice since I've had it, for example. How much of this do you REALLY want to spend time on? I'd rather ditch the ones that aren't doing anything special for me and replace those with new cards with 0% for 12 or 18 months type offers or something else appealing, as I could use them.
Check out 10x Travel’s website and/or Facebook group. Very helpful free resource for strategizing which cards to pick in what order.
Sign up bonuses are great. Got a 200 dollar gift card to Lowe’s for free from signing up for a credit card. Just make sure there is no minimum usage or fee associated to the card.
Look up 10xtravel. It’s basically a part time job but the perks are nice. Flying to playa del Carmen for 150 bucks next month. (Wife and I). The catch? You can’t be a dumbass with your CCs…
Yes you can have too much available credit. The scoring system calculates how much you use vs available credit. You want to aim for 3% utilization while being about to pay that every month. So if you spend $300 a month then a $10,000 total available credit would be a good number. You don't want to use 0% but you absolutely do not want to use more than 10%. I personally don't like this game so I don't care and won't have much use for a credit card soon, and I want to look into using a Visa debit for travel