How Often Should I Apply for New Credit?

I haven ’ deoxythymidine monophosphate applied for a new credit menu in about ten years and my daughter thinks I ’ thousand crazy. I have two cards that I use—one with low interest for buying boastful gorge and the other to rack up airline miles. But according to my daughter, my accredit cards “ suck. ” She thinks that I need to apply for new cards because they have fresh features and fresh rewards that my old cards can ’ t possibly have. Is that genuine or is she just buying into advertise ? How frequently should you apply for newfangled credit cards ?

Hi John ,
I have to say, the counselors and I are in truth impressed—I normally have to convince people not to apply for credit cards. thus having a conversation about not applying for cards frequently enough is rare for me, but it ’ south decidedly a question I can give you some clearness on .

Credit cards don’t expire and rates usually just get higher

credit cards don ’ metric ton come with an passing date. By and big, there is not much reason that you should have to get new cards because your cards are “ besides old ” —particularly in the case of the low-interest card that you have. The rewards card may be a little different, but we ’ ll hash out that downstairs.

first, I would recommend looking at the annual percentage rate (APR) on your low-interest rate credit batting order. If that rate is less than 15 % then it makes sense to keep that bill loose. Rates on credit cards have slowly increased over time, which means you may have a hard time finding a card with a better rate now .

Why it’s smart to keep your old accounts open and active

While new cards may have fresh features and rewards, there ’ randomness besides reason to keep using the cards you already have. Having two credit circuit board accounts in good standing that are more than ten years old is great for your credit. One component used to calculate your accredit mark is “ credit age. ” This measures the average age of your accounts. Older accounts are dear for this agent .
so, if you plan on getting a new card, it does not mean you should close these existing accounts. In fact, keeping them open and in good stand will help you maintain a good credit score. By contrast, barely closing those accounts would decrease your mark .

Before you apply for new credit, call your credit card companies

Another thing to consider—particularly on the low-interest credit card—is that there are very few features that creditors would add to their services that they wouldn ’ thymine stretch to existing customers. so even with your old cards, you ’ d be able to track your history and oversee it online. If the creditor offers on-line credit score tracking, they ’ ve credibly extended that serve to you .
I ’ five hundred recommend looking at the web site for your creditor and seeing what kinds of features and services they offer on newfangled credit cards. If you see something that you don ’ thymine have, call the creditor and ask if that ’ s something they can add to your score .
If you ’ ve been such a firm customer with an account in good stand, they ’ rhenium credibly going to offer whatever they can to keep you about so you won ’ metric ton go somewhere else. There ’ randomness nothing to lose to call your creditor and ask. If you can negotiate to enhance your existing account, that would be in your best interest.

Finding new cards with specific purposes

now, that being said, the rewards credit card may be a different topic. New rewards credit cards and reward feature sets have been created in the past ten years – and you normally can ’ t apply new rewards packages to a different rewards credit tease .
indeed, in this case, if you ’ re using the menu fair to generate rewards strategically, then you may want to explore the new cards available to see if there ’ s something better than what you have .

  • Take your time, research your options
  • Only apply for a new credit card if it has everything that you want and things you can’t get with your existing cards
  • Look for rewards that will fit a specific purpose in your life or budget, such as a card that offers cash back on groceries.
  • If you shop at a specific retailer or merchant, look at what cards they offer. For example, if you are brand-loyal to one gas station, check out the rewards they offer on their gas card.
  • Also, keep in mind that many rewards cards charge an annual fee. Be sure you will make up for that fee with the benefits you receive from using the card.

Space new credit applications out by six months

once you find a card that fits a particular motivation in your budget, make sure you can afford to add the payments into your budget. Keep in mind that you want to pay off your balances in broad every month. This helps you avoid pastime charges, which would cursorily offset any rewards that you earn .
If you find more than one card that fits a necessitate that you have, prioritize them. The poster that offers you the most rewards or perks should be the first circuit board you open. Apply for that card, then wait at least six months until you apply for the adjacent card. This will help you avoid incurring excessively many credit inquiries at once. That ’ south besides a factor used to calculate your credit seduce, so you want to quad newly recognition applications out by at least six months to avoid unintentional wrong .

Make sure to check your credit before you get started

I ’ d besides recommend before you apply, take time to review your credit reports to see what they say. even if you ’ ve been creditworthy and haven ’ thyroxine had any miss payments or problems, there ’ randomness a chance there could be something hiding in your credit report ( including mistakes and errors ) that would decrease your citation mark .
If you find anything incorrect, go through the credit repair process to correct those mistakes before you apply. This will help maximize your score so you can get the best interest rate and terms possible.

Thanks for the question and good luck !
Gary Herman
President of Consolidated Credit
Read Gary ’ s Bio

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Category : Finance

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