There are hundreds, if not thousands, of credit cards available: some trash, some mid, and some great. There's a good chance that if you've had the same credit card(s) for years, it could be time to consider getting a new one. Here are five reasons to consider getting a new credit card.
Your Credit Score is Better
When your credit is trash, your credit card options are more limited than seemingly every SNKRS app release ever. That's just how the game goes. For most people, their first credit card is a secured card. Secured credit cards are great for building and repairing credit, but once you've reached a certain score (at least mid- to high-600s), it's time to leave JV and head on up to the varsity squad.
Look for cards that offer more lucrative perks, lower interest rates, and lower fees. Secured cards have one purpose and one purpose only: helping you build credit. Outside of that, they slick kinda trash. Use them for that credit boost, then get up outta there.
You Want Better Rewards
The two main reasons to use your credit card are emergencies and earning rewards. An emergency is pretty straightforward, but the rewards are definitely a reason to be using your credit card.
There are certain expenses, like bills, that you spend money on each month regardless of what's going on. If you're going to be spending that money regardless, you might as well get something for it—cash back, airline points, hotel rewards, a pat on the back, something.
Let's say you pay $100 monthly for both your phone and internet bill. In a year, you would've spent $2,400 on those bills. Even with 1% cash back, that's $24 you could've earned by using a credit card instead of your debit card. And though $24 may not seem like much, it's $24 more than you would've had otherwise. And that's on the low side, by the time you add in groceries, gas, and everything in between, there's no telling how much free money you're missing out on.
You Want a Higher Credit Limit
Generally, to get a credit limit increase, you need to either request it from your credit card company or wait until they do it automatically. However, some credit cards have a max credit limit they offer to customers, no matter how much they make or how good their credit is.
If you find yourself in that situation, it's time to gon' 'head and grab another card. Even if you don't use it, having a higher credit limit can do for your credit score what a fresh haircut can do to a Black man's confidence. It's all about decreasing your credit utilization.
If you have a $1,000 credit limit and spend $500, your credit utilization is 50%. If your credit limit increases to $5,000, your credit utilization becomes 10%. You always want to keep this number before 30%.
Your Annual Fee Isn't Worth It
Credit card fees range from freer than Willy to higher than ya older cousin on Thanksgiving. If you're paying more for your annual credit card fee than you're receiving from the benefits, you're hustlin' backwards. Your perks should always outweigh the annual fee.
Imagine you have a credit card with a $100 annual fee that offers 1% cashback. You would need to spend at least $10,000 on the card each year to make up for the $100 you paid to have the card.
If $10,000 doesn't sound doable, look at the other benefits the card offers and decide if it's worth the price. If you won't spend $10,000, but the card offers perks like free hotel stays or TSA Precheck or Global Entry reimbursement, it will probably pay for itself.
You Want the Welcome Offer
Many credit cards offer bonuses for folks who open an account and spend a specific amount within a certain timeframe (typically three months). If you were planning to spend the minimum required in that timeframe anyway, you might as well get the extra bonuses.
For example, let's say a credit card offers 50,000 airline points for folks who spend $5,000 within three months of opening an account. If you usually spend $2,000 a month on your card, you know you'll probably meet the $5,000 minimum in three months.
If you know you have a larger expense coming up—say, a home renovation or car repair—and you were planning to use your credit card, it may make sense to get the new card and get those "free" airline points or rewards.
You shouldn't get a credit card just for the welcome offer, but you should damn sure consider it if it's money you were already going to spend. This doesn't mean do this every few months, because that's unnecessary, but if it's been a while since you got a new card and you don't have to change your current spending habits to make the minimum, consider it.