Difference between revisions of "TravelStrategies: *Before You Get Started with Credit Cards"

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=== Avoid blocking other cards you may want ===
 
=== Avoid blocking other cards you may want ===
  
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Several banks have rules that make it difficult or impossible to get their cards once you've gotten more than a few other cards (from any bank) in the past 6, 12, or 24 months. The most important of these rules is something called the "Chase 5/24" rule.  
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Once you've signed up for several cards, it becomes harder to get approved for new cards from most credit card companies.  
  
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<blockquote>
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If you think you might try collecting signup bonuses, or you simply want to get more than a few new cards for your core credit card collection, it helps to plan ahead. That way, you can make sure you won't be blocked from getting the cards that are most important to you.  
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Don't just start signing up for credit cards. Take a few minutes to understand these rules and make sure you are not blocking your ability to get other cards that you may want in the future.
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</blockquote>
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You can reduce the potential for problems by following a few simple rules:
  
 
<ul class="bulletlist">
 
<ul class="bulletlist">
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<li>'''If you aren't interested in collecting signup bonuses, it is useful, but not critical, to be strategic about which cards to get first'''. You probably aren't going to get that many new cards. If you wind up blocking yourself from getting a card you want, you probably won't need to wait too long until you'll be eligible again. But if you don't plan ahead, you can still wind up at least temporarily blocked from one of the cards you want. And by getting some hard-to-get-later cards first, you'll be in better shape if you wind up changing your mind and deciding to collect signup bonuses after all. {{Link|Signup Intro}}.</li>
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<li>'''If you are willing and able to get small business cards, always get the small business version (when it is available)'''. It usually provides essentially the same benefits as the personal card and will have less impact on your chances of getting approved for other cards later. For example, if you want the Amex Delta Gold Card for its free checked bag benefit, get the small business version rather than the personal version.</li>
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<li>'''If you know you want to collect signup bonuses, it really pays to have a solid plan'''. If you just start signing up for new cards, you'll regret it. View our detailed guides of {{Link|first signups}}.</li>
 
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<li>'''If you are willing and able to get small business cards, always get the small business version when it is available'''. It usually provides the same benefits, avoids any potential downsides from getting the card before others, and provides more flexibility for the future. For example, if you want the Amex Delta Gold Card for its free checked benefit, get the small business version rather than the personal version.
 
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<ul>
 
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<li>'''If you have any kind of small business, you are eligible to get small business cards'''. Your business doesn't need to be incorporated. Even a side business—like selling stuff online, doing odd jobs, or working on a book or website—is enough. In most cases, you don't even need to have made any money yet. You just need to apply with your social security number and provide a little information about your business. {{Link|business cards}}.</li>
 
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<li>'''Most small business cards don't show up on your personal credit report'''. Therefore, they won't be counted when banks check to see how many new cards you've gotten. In practice, this is true even for business cards you signed up from the same bank.</li>
 
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While most business cards are not listed on your personal report, some cards are—you can check [//www.doctorofcredit.com/which-business-credit-cards-report/ this list] at Doctor of Credit to see whether it will be counted or not. Currently, you don't need to worry about Chase, Amex, Citibank, Bank of America, Barclays, U.S. Bank, or Wells Fargo. Of the larger credit card companies, only Capital One and Discover report their business cards on your personal report.
 
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</ul> 
 
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<li>'''Before you start signing up for other cards, make a plan to get the Chase and Bank of America cards you really want'''. Chase has a strict rule—you can't get ANY new Chase credit cards once you've gotten 5 new credit cards in the previous 24 months. This counts the cards you get from any credit card company, not just the cards you get from Chase, and is called the "Chase 5/24" rule. Once you sign up for a handful of cards, you won't be able to get a new Chase card for at least two years. If you start collecting signup bonuses, it could be much longer. {{Link|Chase 5/24}}.</li>
 
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Bank of America has a similar rule. If you don't have a Bank of America bank account, the limit is just 3 cards in the previous 12 months. If you sign up for even a small number of new cards, you won't be able to get any Bank of America cards for at least a year. If you do have a bank account, the limit rises to 7 cards in 12 months, which provides a lot more flexibility.
 
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'''If there are any cards you want, you need to get them before you hit these limits'''. Depending on how many cards you've already gotten and how many of these cards you want, you may have fewer remaining "slots" than you need. If so, you'll need to prioritize your choices.
 
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Here's a list of the Chase and Bank of America cards you are mostly likely to want.
 
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<ul class="checklist">
 
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*'''If you can get good value from the Southwest Airlines companion pass, you'll want to get the {{Card|SWAPerformBiz|only}} and the {{Card|SWAPriority|only}}'''. If you aren't getting business cards, it will be really hard to qualify for the pass. {{Link|Companion Pass}}.
 
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*'''If you frequently travel on Amtrak, make sure to get the {{Card|Amtrak|only}}'''. It offers fantastic rewards as long as you can use your points to purchase Amtrak tickets and comes with a nice set of extra Amtrak benefits.
 
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*'''If you fly a few times per year on Alaska as part of a couple or family, you almost certainly want to get the {{Card|Alaska|only}}''' for its valuable companion certificate and free checked bag benefit. If possible, get the business version. If you want multiple certificates each year, you can probably get approved for multiple small business versions of the card. If you can't get the number of certificates you want from business cards, you might want to get the personal card as well. {{Link|Companion Certificates}}.
 
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*'''If you often fly on United get the {{Card|United|only}}'''. If you are likely to take advantage of the free checked bag benefit and you are getting business cards, get the business version. Otherwise, get the personal version, collect the signup bonus, and convert to the no-annual-fee version after the first year. You'll still get access to extra United award space and can switch back to the regular version whenever you want. {{Link|airline card}}.
 
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*'''Decide what approach you want to take for your everyday spending'''. If you want to use the "Chase Unlimited Combo", you'll need one of the '''[[Sapphire Credit Cards|Sapphire cards]]''' and one of the Chase Unlimited cards (ideally the '''{{Card|InkUnlimited|only}}''' ). If you want to take advantage of the Bank of America Platinum Honors program, get the '''{{Card|BOAPremium|only}}'''. If you're not sure, you might want to get all three, collect their signup bonuses, and decide which ones to use later. {{Link|general purpose}}.
 
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*'''Most people probably want to get the {{Card|Hyatt|only}}'''. If you frequently stay at Hyatt, the extra elite status nights might make the difference for qualifying for a higher status level. Even if you don't, it is nice to have access to the free night certificate. {{Link|Free Night Certificates}}.
 
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*'''The {{Card|Marriott|only}} is useful, but you could get the Amex card instead'''. Either one provides the same 15 elite night credits and a hotel certificate. If you don't want to pay the extra money for the premium {{Card|SPGLuxury|only}}, Amex will let you convert it to a cheaper version after one year. On the other hand, you can only have 5 Amex credit cards at any time, so if you want a Delta card and one or more Hilton cards, Chase's card becomes a better option.
 
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*'''If you are getting business cards, we recommend getting at least one of the Chase Ink cards''', so that you keep open the possibility of getting any of them at a later date. The {{Card|InkPreferred|only}} has the best signup bonus. After the first year, you can convert to a no-annual-fee card or to whatever version would be most helpful.
 
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*'''If you like hotel certificates, you probably want the {{Card|IHG|only}} as well'''. 
 
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</ul>
 
  
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<li>'''You may also want to prioritize getting the {{Card|Altitude|only}}'''. It offers a valuable 4.5% reward rate on purchases made with mobile wallets (such as Apple Pay). With a Samsung phone or watch, you can earn this mobile wallet reward rate at any location where you would "swipe" your card, even if they don't explicitly accept mobile wallet payments.</li>
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If you have any kind of small business, you are eligible to get small business cards. Your business doesn't need to be incorporated. Even a side business—like selling stuff online, doing odd jobs, or working on a book or website—is enough. In most cases, you don't even need to have made any money yet. You just need to apply with your social security number and provide a little information about your business. {{Link|Business Cards}}.
  
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The Altitude Reserve is difficult to get once you start collecting other cards. So, if you want it, try to get it as one of your first few cards. You'll also need to open a bank account at U.S. Bank before you can get it.  
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<li>'''If you are planning to follow our recommendation to start signing up for cards just for their signup bonuses, it is really worthwhile to plan out your applications'''. Otherwise, you are likely to get blocked from many of the best offers. We provide a {{link|first signups|detailed plan}} of how to time your applications. {{Link|Signup Intro}}.</li>
  
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<li>'''You need to get any Chase business cards before you hit their 5/24 limit'''. While Chase's business cards aren't counted when calculating the number of new cards you've gotten, once you've hit Chase's limit, they won't approve you for either personal or business cards. This can be confusing. If you have already received 4 new cards in the last 24 months and you sign up for any number of new Chase business cards, your 5/24 count will still be 4 and you can still get 1 more personal card. But if you sign up for the personal card first, your count will be 5 and you won't be able to get any more business cards.</li>  
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<li>'''Prioritize getting any Chase, Bank of America, Barclays, Capital One or Barclays cards you want'''. Once you've gotten new 5 cards from any bank in the previous 24 months, Chase won't approve you for any new cards. Bank of America has a similar rule, except that it is 3 cards in the previous 12 months (for non banking customers). Most business credit cards don't count against those limits, which is part of the reason you should try to get them if you can.</li>
  
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The same is NOT true for Bank of America. You should be able to get their business cards even if you are over their limit.  
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With the other banks, there aren't fixed limits, but it just gets harder to get approved the more applications you have.  
  
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<li>'''If any Barclays, Wells Fargo, or Capital One cards are critical to you, you'll want to make sure you get these cards early'''. While they don't have a fixed rule like Chase and Bank of America, all three of these banks are less likely to approve you once you've gotten a few other cards in the past 6 or 12 months.</li>
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Because these banks, especially Chase and Bank of America, issue a lot of interesting cards, you need to get these first, before you get blocked for a year or two (or more if you are collecting signup bonuses). It is easier to get any Amex or Citibank cards you want later.
  
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<li>'''You may be able to squeeze in some cards from other banks'''. Once you figure out which Chase and BOA cards you want, you can see if you have any extra "slots". Remember, business cards won't take up a slot. For example, if you started out with 1 card in the past year, want 1 Bank of America personal card and 3 Chase personal cards, you'll have 1 extra slot. As long as you make sure to get the Bank of America card as one of your first two cards, you could get one additional card (at any time) without blocking the Chase cards you really want.</li>
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Cards you are mostly likely to want that are issued by these banks are up to two [[Southwest Credit Cards|Southwest Airlines Cards]], the {{Card|Amtrak|only}}, the {{Card|Alaska|only}}, the {{Card|United|only}}, one of the [[Sapphire Credit Cards|Chase Sapphire Cards]] and the {{Card|FreedomUnlimited|only}} or the {{Card|BOAPremium|only}}, the {{Card|Hyatt|only}}, the {{Card|Marriott|only}}, and at least one of the [[Ink Preferred Card|Chase Ink cards]].
  
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However, from a signup bonus perspective, an even better plan would be to use the extra slot to get an extra card from Bank of America or Chase and wait to get a card from another bank until later.  
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<li>'''You may also want to prioritize getting the Altitude Reserve '''. If you plan to optimize the points you earn from your spending, the {{Card|altitude|only}} can be very helpful. It provides a valuable 4.5% reward rate on purchases made with mobile wallets (such as Apple Pay), along with some other nice benefits. By taking advantage of contactless credit card terminals (and many Samsung phones), you can use a mobile wallet for many of your payments. But because it is difficult to get the Altitude Reserve, once you start collecting other cards, you need to try to get it as one of your first few cards. You'll also need to open a bank account at U.S. Bank before you can get it.</li>
 
</ul>
 
</ul>
  

Revision as of 14:52, 2 February 2021

  Credit Card Reference


There are a few things you should do before you start signing up for any new credit cards.

Avoid blocking other cards you may want

Once you've signed up for several cards, it becomes harder to get approved for new cards from most credit card companies.

If you think you might try collecting signup bonuses, or you simply want to get more than a few new cards for your core credit card collection, it helps to plan ahead. That way, you can make sure you won't be blocked from getting the cards that are most important to you.

You can reduce the potential for problems by following a few simple rules:

  • If you are willing and able to get small business cards, always get the small business version (when it is available). It usually provides essentially the same benefits as the personal card and will have less impact on your chances of getting approved for other cards later. For example, if you want the Amex Delta Gold Card for its free checked bag benefit, get the small business version rather than the personal version.

    • If you have any kind of small business, you are eligible to get small business cards. Your business doesn't need to be incorporated. Even a side business—like selling stuff online, doing odd jobs, or working on a book or website—is enough. In most cases, you don't even need to have made any money yet. You just need to apply with your social security number and provide a little information about your business. Unlock Extra Reward Points with Business Credit Cards.

  • If you are planning to follow our recommendation to start signing up for cards just for their signup bonuses, it is really worthwhile to plan out your applications. Otherwise, you are likely to get blocked from many of the best offers. We provide a detailed plan of how to time your applications. Credit Card Signup Bonuses: The Easiest Path to Free Airplane Tickets and Hotel Nights.
  • Prioritize getting any Chase, Bank of America, Barclays, Capital One or Barclays cards you want. Once you've gotten new 5 cards from any bank in the previous 24 months, Chase won't approve you for any new cards. Bank of America has a similar rule, except that it is 3 cards in the previous 12 months (for non banking customers). Most business credit cards don't count against those limits, which is part of the reason you should try to get them if you can.

    • With the other banks, there aren't fixed limits, but it just gets harder to get approved the more applications you have.

    Because these banks, especially Chase and Bank of America, issue a lot of interesting cards, you need to get these first, before you get blocked for a year or two (or more if you are collecting signup bonuses). It is easier to get any Amex or Citibank cards you want later.

    Cards you are mostly likely to want that are issued by these banks are up to two Southwest Airlines Cards, the Amtrak Credit Card, the Alaska Airlines Credit Card, the United Explorer Credit Card, one of the Chase Sapphire Cards and the Freedom Unlimited Card or the BOA Premium Rewards Card, the Hyatt Credit Card, the Marriott Bonvoy Boundless Card, and at least one of the Chase Ink cards.

  • You may also want to prioritize getting the Altitude Reserve . If you plan to optimize the points you earn from your spending, the Altitude Reserve Card can be very helpful. It provides a valuable 4.5% reward rate on purchases made with mobile wallets (such as Apple Pay), along with some other nice benefits. By taking advantage of contactless credit card terminals (and many Samsung phones), you can use a mobile wallet for many of your payments. But because it is difficult to get the Altitude Reserve, once you start collecting other cards, you need to try to get it as one of your first few cards. You'll also need to open a bank account at U.S. Bank before you can get it.

Get set up

  • Sign up for Credit Karma and possibly some other credit-monitoring tools. As you start signing up for new credit cards, you will want to keep an eye on your credit score.

    • While several different methods to check your score, we recommend signing up for Credit Karma. Its free, provides relatively detailed information, and is updated at least weekly. For some other options, see Monitor Your Credit Score to Make Sure Everything is On Track.

    CreditKarma.png
  • Register for Award Wallet (if you haven't already). Award Wallet is a free tool that keeps track of all your loyalty accounts and information. We are big fans of signing up for every hotel and car rental loyalty program (and a handful of frequent flyer programs), and AwardWallet is an indispensable tool to help us deal with all our different accounts. Use AwardWallet to Easily Manage Your Loyalty Program Information.

    • If you sign up for a hotel or airline credit card, you'll need to enter your corresponding loyalty account information and the easiest way to retrieve it is with AwardWallet. If you start collecting signup bonuses, you'll eventually wind up signing up for a card that is associated with a program that you haven't joined yet. The credit card company will set up a new account for you, and you can store that information in it as well.

    AwardWalletDevices.jpg
  • Consider opening a Bank of America and/or a U.S. Bank savings account. If you don't have a bank account, Bank of America usually won't approve a new credit card application once you've gotten at least 3 cards, from any bank, in the last 12 months. Once you start signing up for even a small number of cards, you'll no longer be able to get any Bank of America cards that you may want. And if you are collecting signup bonuses, you won't be able to take advantage of any of Bank of America's lucrative offers. If you have a bank account, the limit increases to 7 cards in the last 12 months. This provides a lot more flexibility.

    • If you don't have a bank account, it is hard to get approved for U.S. Bank's valuable Altitude Reserve Card.

    You can avoid fees on these savings accounts by maintaining a balance of $500 at Bank of America or $300 at U.S. Bank.

TravelStrategies:*Before You Get Started with Credit Cards/Main


CreditCard.jpg
Credit Cards 101
OpeningEnvelope.jpg
Step-by-Step Guide: After You Receive Your New Card
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Step-by-Step Guide: Getting Rid of a Credit Card

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