Sometimes I get questions that are out of my league. In the past, I’ve just sort of ignored these, but I’d like to try to answer more of them. To do this, I’m going to start asking for tips from some of the experts I’ve met through GRS.
For example, my good friend Mac from Get Fit Slowly (where I may eventually write again some day), came to me this week with a question about credit cards. In fact, it’s a question I get surprisingly often: He wants to know how to find the best credit card for his needs. To find out, I tapped a couple of the experts in my professional network.
First, let’s look at Mac’s situation:
My wife and I are long-time users of the Alaska Airlines Platinum Credit Card. We use this card to earn frequent-flier miles, and since we primarily fly up and down the West Coast to visit family with our children, Alaska seemed like the way to go. The card also has a few other perks:
- One frequent-flier mile for every dollar spent.
- Two frequent-flier miles for every dollar spent on alaska airline flights.
- One companion ticket each year (buy one full-price ticket, get a second for $99).
I have no idea what the interest rate is because we pay off the card every month without fail. Neither of us likes to carry cash, so we basically use this card for everything we can. (We even use it for small purchases like morning coffees and video rentals.)
Recently, I’ve been unhappy with some changes they’ve made to the card benefits. So, I’m looking into switching cards and was wondering if you could offer some advice. I’m looking for a rewards based card for folks who pay off their balance each month. Our rewards would be used for travel, so I’d like the best travel rewards primarily, but I’m not opposed to other rewards programs such as merchandise rewards, etc.
A few of the cards I’ve looked at but haven’t pulled the trigger on are the American Express Platinum Card and the Chase Sapphire Card. I’m not sure which of these to choose from or if there are better options out there. What are your thoughts?
My thoughts are that looking at credit card offers makes my mind numb. I’d rather go to the dentist!
As most of you know, I carry just one credit card (a Capital One No-Hassle Cash Rewards card), and sometimes I think I should get rid of even that. But I really do like getting one percent cash back on the things I buy, so I’ve kept the card. (And I use it — a lot.)
If I were to start looking for a new card, I’d start by checking two sites: Index Credit Cards and Card Ratings. There are other credit-card sites out there, but these are the two I know best. Both have huge lists of cards that you can sort through to find the one that fits your needs.
In fact, because I know so little about this subject, I contacted both sites to ask if they could give feedback on Mac’s predicament. Here’s what Curtis Arnold from Card Ratings had to say:
Many of our readers share Mac’s frustration. I personally have never been a big fan of airline reward cards, but particularly in this tough credit environment; my personal mantra is that cash is king.
I would challenge Mac to take a look at our recent press release regarding the best credit cards of 2009. There are a couple of cash rebate credit cards that give you 2% cash back on every purchase and several cards that give you 5% back on certain types of purchase. If you do the math and compare the rebate percentage of these cards with your current one, I would be shocked if your current card even comes close.
Adam from Index Credit Cards suggested two options, depending on how important the travel rewards are to Mac and his wife:
First is the Citi PremierPass Card, which pays you points on purchases as well as on actual travel miles flown. There’s a no-annual-fee version of this card as well as a card that charges $75 annually but offers a more generous rewards package. Which you choose would obviously depend on how often you use your card and also how often you would buy airline tickets with it. You can use the points from this card for travel across airlines or for other rewards from Citi’s ThankYou rewards program.
Second is American Express Blue Cash. Based on Mac’s description of his card use habits, I’m assuming he puts a lot of expenses on his card every year. This card is a cash rebate card that works best the more you spend with it. At first you earn a modest 1% cash back on gas and grocery purchases and 0.5% on other purchases, but after you’ve spent $6,500 with the card, those reward percentages go up to 5% on gas and groceries and 1.25% everywhere else, with no limit on your rewards. Think hard about your expenses, though, because if you won’t spend significantly more than $6,500 per year, you’re better off going with a straight cash back card without this tiered formula.
See why I went out to the experts? This is all gibberish to me. Maybe I’m hurting myself with my ignorance, but I’m content with my Capital One No-Hassle Cash Rewards card. It gives me one percent cash back on everything I buy. That’s it. No muss, no fuss. The whole thought of having to track travel miles makes me tense! (Seriously.)
Anyhow, what are your thoughts? Where do you go to get info on current credit card offers? What should Mac look for in a card? Can you recommend any options for a family that doesn’t carry a balance, but uses their card for most of the purchases they make?
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