I am stepping off the credit card application merry-go-round — for the time being.
Here are 8 reasons why:
1. I am still holding unspent gift cards. I acquired a number of gift cards to meet the minimum spend requirements for the Chase Ink Plus rewards credit card I opened last year. These include ITunes, Starbucks, Amazon, and Trader Joes gift cards. I have about $500 of credits on these various cards that I want to spend down before incurring another minimum spend requirement.
2. I need to give my credit score a break. My credit score took a hit from numerous credit inquiries and from lowering the average age of my accounts. A hiatus from credit card applications will allow my accounts to mature and give my credit rating a chance to recover.
3. I can meet my immediate travel needs with points/miles already in hand. My family has lots of travel planned for this summer, but with 180,000 points/miles in the bank, I should be able to finance about half a dozen cross-country flights. At a recent Frequent Flyer University conference, the advice from the experts was to use your miles to protect against program devaluations.
4. There are great new offers just around the corner. It seems like there are always new bonus offers for opening rewards credit card accounts. There are more than half a dozen very attractive offers that interest me right now. I am guessing that these opportunities are not going to go away any time soon, and if they do, something new and maybe better will come along.
5. I want to be strategic in any future applications. I need time to map out a strategy consistent with my family’s travel needs over the coming year. I anticipate a lot of train travel in our future, so I would like to start collecting Amtrak points. I would love to plan a trip to Japan but that is not in our budget for now. It takes time to learn the intricacies of booking award flights and hotels with frequent flyer miles. I want to take stock of my long-term goal, and determine how many points/miles are realistically needed to finance a trip to Japan.
6. I would like to stay flexible in case a great limited time offer comes around. If a surprise offer for a large number of bonus points hits the street, I do not want to be rejected for “too many recent inquires” on my credit report.
7. I have great points earning opportunities with the cards in my wallet. I am a long-time holder of the Chase Freedom card which gives 5 times points on popular categories every quarter. The Chase Ink card pays 5 times points on routine business expenses such as monthly phone charges and the cell phone bill. These cards provide a steady stream of points without much effort.
8. I want to understand the pros and cons of various programs. When I first got into the game, I applied for cards on an ad hoc basis. As a newbie, I did not always make the smartest choices. I don’t have much flexibility on when I can travel and I prefer nonstop flights. Some programs offer easier and more plentiful redemption options. Others may be less flexible, for instance only allowing redemptions for round-trip tickets, or only offering nonrefundable tickets. Information about the pros is readily available. I’d like to better explore the cons.
For a good discussion of the potential dangers of applying for credit cards, see this post by Million Mile Secrets.
There is no doubt that applying for travel rewards credit cards can net you large bonuses that can pay for tons of free travel. By taking a breather, I can better assess the options that make the most sense for my family — which may be instructive for others.
Have you taken a break too, or are you still gung ho for big points earning opportunities?
If you have enjoyed this article, please consider signing up for regular notices of new articles by email, Twitter, or RSS feed.