The one piece of advice I always give people when opening credit cards is to have a goal in mind. I don’t see the point in opening cards just for the points or just to have more cards, with no plan in place. I have plenty of cards, many of which I will look for retention offers/canceling once the fee comes due, but this still doesn’t stop me from looking at others. I can’t count the number of times I have had an application filled out, ready to submit and had to think back to the advice I give anyone. With all the cards out and with so many bloggers saying why you must have this card, it can be difficult not to apply for every single offer out there. There is one thing I have come to learn in the few years I have been doing this…
Whenever you see a BIG credit card offer and see countless bloggers telling you that this is the greatest thing to grace the earth, remember this…There will always be large credit card offers because banks want your business. In the past couple of weeks alone, we have seen Citi increase their Thank You Premier to 60,000 points, going incognito or calling, you could find the American Express Platinum 100,000 point bonus, Marriott had an 80,000 point offer and SPG just did their annual increase to 30,000 points, American Express. There will always be a large bonus, but I think it is important to have a goal before applying for a new card.
With so many increased offers, you might feel if you don’t have these cards, you are missing out. If you don’t stay at Hilton’s or Marriott’s odds are you didn’t need that card anyways. If you planning a trip and a Hilton or Marriott is the best property there, then you should consider it. Again, it is all about having a plan.
Think of applying for a rewards card like making meal, you wouldn’t go to the grocery store and just buy random ingredients then look for a recipe (some might!). When picking out a credit card (ingredients), you should have a goal redemption (meal) in mind and know what cards you will need for that redemption. You’ll want to know how much of a product you’ll need (points) to make your meal (redemption). Sometimes the amount of product you need, can make you look for a better option.
Sometimes the best offer is not the best offer for you at that time. For example, in a couple of months I am going to Budapest and Prague and I was looking for a reason to have the Hyatt credit card, which came with 2 free nights anywhere in the world PLUS $50 statement credit. When I looked for my options, there wasn’t a Hyatt in that area, not even close to it. So that would have been a complete waste for me! You should always to do your homework and find out what airlines fly to the area you are traveling too. Also, which hotels you can stay at in the area and the estimated cost in points. If you have questions, I am more than happy to send you in a direction that works best for you :-).
I’ve seen countless times where someone will say, “Hey I have so many (fill in a rewards program) points, but I can’t use them because there are no (fill in a reason).” I have gotten better at selecting the cards that work for us, but that doesn’t mean I don’t stray and want to apply for others. This is a perfect example, I was totally prepared to fill out 2 Hyatt applications and Hilton application, here was my problem. I had no redemption in mind. I would have 4 free nights anywhere in the world plus 75,000 Hilton points! All of which would be a complete waste for me. I had no plan to use them.
I’m sure I am not the only person to get carried away and think of all the awesome things I can do with my points. I see awesome pictures and post about the trip someone just took and how they got there. When I read different blogs, I realize that I am different from them because my job isn’t one I can just call in sick, take a day off at the last minute, or take months off at a time.
I also realize I don’t put much emphasis on the hotel stay, because we are in the hotel just to sleep, not hang out in an upgraded suite. I make my plans well in advance and I apply for credit cards the same way. At the same time, I don’t manufacture spend and have no intention to start either. So most of my points come from real spending or credit card bonuses. That means it can take me a little longer to earn more points, so maximizing my rewards is important to me.
Besides having a goal in mind before applying for a new card, some of the other rules I make for myself and I’ll gladly tell others. If I receive a hotel credit card, I better receive a free night every year I renew my card with that bank. With so many cards out there, I fail to see any reason to hold a hotel card and pay a fee that does not give me a “free night.” I usually prefer a certificate instead of points because all programs, inevitably are going to devalue. If there is no free night, I do not want the card. Plain and simple.
Airlines cards, I don’t keep many of these because I am not loyal to one airline. I usually fly the airline that gives me the best value, while also costing me less points for my trip. I will gladly redeem for a lower value, if it means redeeming less points. For people who check bags, that could be a very important perk, since it could save you money. Having a companion pass where you either pay a reduced fee or have a free ticket could be extremely useful for some. I would always figure out who flies from the airports closest to you. If you live in Miami, then having the Southwest Companion Pass is useless since Southwest doesn’t fly to or from Miami.
I think the best cards are flexible bank point cards, like Ultimate Rewards, Membership Rewards and Thank You Points. I think SPG is overrated, but for many they think this is the best reward program. These keep your points a little more sheltered from devaluation and allow flexibility. This is where I keep most of my points, because not only am I a little safer for devaluations, I have so many more options!
It is easy to get carried away and apply for cards for big bonuses, especially when there are many people telling you what these points can do for you. I wouldn’t worry about missing out on a particular offer now, because odds are in your favor a large offer is just around the corner. If you work backwards and have a goal in mind there is no reason you can’t plan a trip and pay close to nothing for it. Always remember, the best redemption is the one that works best for you.
What are your rule when applying for a rewards credit card? Ever apply for a card and realize you had no use for the points?