Card Renewal Strategy?
Dec 27, 2012, 7:23 am
#1
Original Poster
Join Date: Jan 2012
Location: Evanston, IL
Posts: 6
Card Renewal Strategy?
Hi everyone,
I got into the credit card signup game last year and have several cards coming up for renewal. I know that everyone has their own situation on these things but I was wondering what you all thought about the following questions:
1. Is it always worth it to keep a card open if there is a yearly retention bonus? For example, the US Airways card gives 10k bonus miles on card anniversary and the Chase Southwest card gives 6k. This seems to make some sense to me.
2. Does it make sense to keep cards for the perks of early boarding and discounted mileage redemptions? This seems to be the case if you actually do plan to fly the airline, right?
3. How do you go about deciding on a high fee card like the American Express Premier Rewards Gold card? I like its point multipliers on gas and groceries, how much spending do I have to do on it to make those multipliers worth the fee?
4. If I can afford the fees, should I even bother canceling? It seems like it would be good for my credit score to keep these large lines of credit open, thus giving me the best deals in the future.
I got into the credit card signup game last year and have several cards coming up for renewal. I know that everyone has their own situation on these things but I was wondering what you all thought about the following questions:
1. Is it always worth it to keep a card open if there is a yearly retention bonus? For example, the US Airways card gives 10k bonus miles on card anniversary and the Chase Southwest card gives 6k. This seems to make some sense to me.
2. Does it make sense to keep cards for the perks of early boarding and discounted mileage redemptions? This seems to be the case if you actually do plan to fly the airline, right?
3. How do you go about deciding on a high fee card like the American Express Premier Rewards Gold card? I like its point multipliers on gas and groceries, how much spending do I have to do on it to make those multipliers worth the fee?
4. If I can afford the fees, should I even bother canceling? It seems like it would be good for my credit score to keep these large lines of credit open, thus giving me the best deals in the future.
Dec 27, 2012, 11:09 am
#2
Join Date: May 2012
Location: New York
Programs: Marriott Lifetime Titanium, Hertz Pres. Circle, HHonors Diamond
Posts: 561
1. It depends on how much you value the retention bonus they are giving you. If you use US Airways often and can take advantage of the current benefits the card provides, taking the 10K (or more?) miles to stay with them may be worth it. I know some people that won't take it and they may have some luck on getting bigger retentions.
2. Again, it's up to each card member and I assume this is a card with an annual fee. If you usually board flights that are packed and have a large carry on item, it may be worth it to keep the card. Depending on how much is the miles redemption (basically how much you can save) and how often you travel with them (leisure I suppose), that should also play a role on whether it's worth it for the annual fee.
3. The AMEX PRG card comes with a $175 annual fee if I recall correctly. I don't have a specific amount of spending in mind, but depending on what you use your points for, it will vary. AMEX tend to have promotions that give bonus transfer points/miles. I think I saw one for British Airways and Hilton for 30-33% bonus.
4. Personally, even if I can afford the fees, I wouldn't keep them unless they are put to good use. Keeping them open will give you a larger line of credit but you can always open up new cards assuming you are still in the game
The main thing I look for in keeping cards with annual fees is what kind of benefits I get from keeping/using the card.
UPDATE: For point #3 above, it looks like you get an extra 15K MR points if you can spend $30K in a year. So I would say if you can put that much into the card, then it will be worth it on top of the extra points you'll be accumulating already from your purchases.
2. Again, it's up to each card member and I assume this is a card with an annual fee. If you usually board flights that are packed and have a large carry on item, it may be worth it to keep the card. Depending on how much is the miles redemption (basically how much you can save) and how often you travel with them (leisure I suppose), that should also play a role on whether it's worth it for the annual fee.
3. The AMEX PRG card comes with a $175 annual fee if I recall correctly. I don't have a specific amount of spending in mind, but depending on what you use your points for, it will vary. AMEX tend to have promotions that give bonus transfer points/miles. I think I saw one for British Airways and Hilton for 30-33% bonus.
4. Personally, even if I can afford the fees, I wouldn't keep them unless they are put to good use. Keeping them open will give you a larger line of credit but you can always open up new cards assuming you are still in the game
The main thing I look for in keeping cards with annual fees is what kind of benefits I get from keeping/using the card.UPDATE: For point #3 above, it looks like you get an extra 15K MR points if you can spend $30K in a year. So I would say if you can put that much into the card, then it will be worth it on top of the extra points you'll be accumulating already from your purchases.
Last edited by gk17; Dec 27, 2012 at 12:10 pm
Dec 28, 2012, 1:34 am
#4
Join Date: Dec 2003
Location: Brooklyn, NY, United States
Programs: AA, BA, UA, Spirit, Delta, PC Plat, SPG Gold, HHonors Diamond, Club Carlson Gold, Marriott Gold
Posts: 1,735
I think the most important question is the one you didn't ask. Are you going to churn or not? If not, then you might be better off using cards for their perks, but make sure that the fees/benefits ratio works in your favor. If you intend to churn, you WILL have to close cards anyway, in which case I would recommend to close before the AF is about to hit. There are always exceptions of course. I, for example happily pay AF for US Air, CSP and Chase Priority.
Dec 28, 2012, 4:52 pm
#6
Join Date: May 2009
Location: HNL
Programs: HA, DL, UA, PC Gold, A/club Plat, HH Gold, Hyatt Pl
Posts: 1,461
1...even though US air gives miles bonus i'll probably cancel...wait a bit and reapply and get another 40k miles....it all depends on if u want to pay for the anniversary bonus
2.. regarding perks..depends how many times your going to use it...guestatmate the value of the perks and times it by times it will be used..then determine if you its valuable enough
3... i wouldn't keep the prg..just to expensive for me...unless your spending like big bucks on airfare...lets say MR pts are worth 0.5 cents per(which is really low)...so to make up that cost..u would have to book 175/0.005=35,000/3pts per dollar=$11,666 worth of airfare to make it worth while if you were just getting the 3x bonus on airfare.
4..instead of worrying about annual fees..add in a couple of no fee cards(hilton amex, chase freedom) to every AOR..that way you will build more credit history
2.. regarding perks..depends how many times your going to use it...guestatmate the value of the perks and times it by times it will be used..then determine if you its valuable enough
3... i wouldn't keep the prg..just to expensive for me...unless your spending like big bucks on airfare...lets say MR pts are worth 0.5 cents per(which is really low)...so to make up that cost..u would have to book 175/0.005=35,000/3pts per dollar=$11,666 worth of airfare to make it worth while if you were just getting the 3x bonus on airfare.
4..instead of worrying about annual fees..add in a couple of no fee cards(hilton amex, chase freedom) to every AOR..that way you will build more credit history
Dec 28, 2012, 4:54 pm
#7
Join Date: May 2009
Location: HNL
Programs: HA, DL, UA, PC Gold, A/club Plat, HH Gold, Hyatt Pl
Posts: 1,461
1...even though US air gives miles bonus i'll probably cancel...wait a bit and reapply and get another 40k miles....it all depends on if u want to pay for the anniversary bonus
2.. regarding perks..depends how many times your going to use it...guestatmate the value of the perks and times it by times it will be used..then determine if you its valuable enough
3... i wouldn't keep the prg..just to expensive for me...unless your spending like big bucks on airfare...lets say MR pts are worth 0.5 cents per(which is really low)...so to make up that cost..u would have to book 175/0.005=35,000/3pts per dollar=$11,666 worth of airfare to make it worth while if you were just getting the 3x bonus on airfare.
4..instead of worrying about annual fees..add in a couple of no fee cards(hilton amex, chase freedom) to every AOR..that way you will build more credit history
2.. regarding perks..depends how many times your going to use it...guestatmate the value of the perks and times it by times it will be used..then determine if you its valuable enough
3... i wouldn't keep the prg..just to expensive for me...unless your spending like big bucks on airfare...lets say MR pts are worth 0.5 cents per(which is really low)...so to make up that cost..u would have to book 175/0.005=35,000/3pts per dollar=$11,666 worth of airfare to make it worth while if you were just getting the 3x bonus on airfare.
4..instead of worrying about annual fees..add in a couple of no fee cards(hilton amex, chase freedom) to every AOR..that way you will build more credit history