topic Re: Short Term or Long Term Value? in Credit Card Applications

Short Term or Long Term Value?

KLEXH25 — Sun, 09 Jun 2019 17:30:32 GMT

When you apply for a credit card, do you consider how well it will serve you in the long term? Or do you only consider your current, short term needs? I'm thinking of applying for the AMEX Gold, because I can see it serving my needs for the next year or two, but I don't know if it will continue to be valuable to me beyond that. And since the only PC options are the Green or Platinum, in all likelihood, I'll end up closing it. Would you still bother? Am I overthinking this?

Re: Short Term or Long Term Value?

Anonymous — Sun, 09 Jun 2019 17:49:13 GMT

Specifically for Gold... I picked up the 50K in MR's for the bonus to see their value to me. I didn't find much value in them when redeeming them and nixed the card before the AF hit.

If you don't find redemption value w/ MR's then just pick up the points and move onto something different. There are "perks" you prepay for with each tier of card. Pay more, get more.

If it's your first Amex then it's a foot in the door but, I would wait for the promo to change to a first year waived AF instead of wasting $250 of the bonus on the fee.

Re: Short Term or Long Term Value?

KLEXH25 — Sun, 09 Jun 2019 18:51:59 GMT

Well I have a lot of cash back rewards so a card with travel rewards that I can actually use is of interest. I don’t have an AMEX yet, so it’s hard to say if MR points is the ideal one for me without any actual experience with them, but based on what I’ve read and throw in the sub, it’s a good start. Then I figured I can change over to the ED or EDP afterwards if I want to continue earning MRPs. Since a large portion of my spend is dining out and groceries, the Gold gets me more bang for my buck but that AF is steep. I know I can use the credits to make up for it, but I’m just trying to figure out if it’s really worth it. I’m practical and relatively conservative in nature, so I’m trying to look at it from all angles. Without the 50k SUB though, I wouldn’t bother.

Re: Short Term or Long Term Value?

Anonymous — Sun, 09 Jun 2019 19:13:52 GMT

Well, wait for the AF to be waived and give it a run for the points! A good standby for pooling MR's is the old Blue card w/o a fee or any perks. It holds your MR's w/o being needy.

Ed/EDP aren't your best options either of those categories though. The BCE/BCP are your key grocery cards and for dining the comp for the Gold is the Uber @ 4%.

I look things as... if you have to go out of your normal routine to make a card work then it's not really worth the hassle. Cash back is simple... when you have to run calculations, jump through loopholes, and scheme to get the best bang for points/miles it just gets a bit tedious. If you're not already traveling to take advantage of the perks then it's another hurdle to consider.

Sure, there are plenty of ways to make cards work for travel that's near free but, there's some serious spend behind those tactics. Nothing is ever "free" there's always something you have to do to make it happen.

Re: Short Term or Long Term Value?

pinkandgrey — Sun, 09 Jun 2019 20:49:00 GMT

For me personally, I never apply for a card with the intention of closing it early. (Not to say I have never closed them early though lol) As for the Gold, if you can do the AF, I would say go for it. But don’t close it any earlier than a year or Amex will view you as a churner. Who knows? You may end up wanting to keep it. Good luck with whatever you decide!

Re: Short Term or Long Term Value?

DaveInAZ — Sun, 09 Jun 2019 21:57:29 GMT

@KLEXH25 wrote:
When you apply for a credit card, do you consider how well it will serve you in the long term? Or do you only consider your current, short term needs? I'm thinking of applying for the AMEX Gold, because I can see it serving my needs for the next year or two, but I don't know if it will continue to be valuable to me beyond that. And since the only PC options are the Green or Platinum, in all likelihood, I'll end up closing it. Would you still bother? Am I overthinking this?

Well normally for CCs I consider the long term. A recent app & approval ws BBVA Compass Clear Points Visa - only $150 SUB for $1500 spend, but it has a 3% & 2% reward category you chose quarterly and that gets me 3% at Walmart for anything as my store codes as grocery, and the 2% gets me 2% for medical, and I had some recent high spend for medical & dental.

But for Amex often the short term strategy works. I recently took their offer to upgrade my Blue Cash Everyday to Preferred. With $95 annual fee the upgraded 6% rewards on grocery and 3% on gas really don't work for me as grocery isn't a big spend for me, I'm single and over half my grocery spend is at Walmart, and as my car get 37mpg and work is a 10 commute gas isn't a big spend for me either. But the $250 SUB w/$1k spend was too good to pass up with no new inquiry & no new account.

BUT Amex doesn't like you closing any card, and closing an AF card before the first AF hits is a big no-no, that can land you on their "No more SUBS for you! Churner List". So for my BCP upgrade I'll pay the pro-rated AF that hits after this month's statement and then next year's AF and then downgrade to BCE before the 3rd AF hits, and I'll still come out well ahead.

So if the Amex Gold meets your need for the next two years it can be a good short term strategy for you.

Re: Short Term or Long Term Value?

Anonymous — Mon, 10 Jun 2019 00:00:22 GMT

I guess it depends on the card for me.

I have some cards that I’ve gotten just to finance a purchase, or to do a BT. To me, that’s short term.

On the other hand, I’ve applied for cards that I plan on putting a bunch of use through to reap the reward structure.

In the future I will app for cards that help in the short term and long term. Maybe I’m doing it wrong, but it’s been working for me

Re: Short Term or Long Term Value?

Anonymous — Mon, 10 Jun 2019 00:03:44 GMT

Credit card companies change their rewards programs all the time so I go for what makes sense for my needs in the short term rather than planning out the long term.

Re: Short Term or Long Term Value?

xaximus — Tue, 11 Jun 2019 18:17:09 GMT

Generally, rule of thumb is - get what works for you and benefits you, otherwise, if you have to make any sort of change to make a card work, is it really worth it? If you aren't a frequent traveler, there wouldn't be too many reasons for you to get a travel card, etc. At the end of the day, do what benefits you. Numbers definitely help in deciding if it's worth it or not, but look at the benefits and see if they line up with your lifestyle, if it doesn't then I wouldn't do it. If it does, then well go for it.

Re: Short Term or Long Term Value?

SouthJamaica — Tue, 11 Jun 2019 21:01:35 GMT

@KLEXH25 wrote:
When you apply for a credit card, do you consider how well it will serve you in the long term? Or do you only consider your current, short term needs? I'm thinking of applying for the AMEX Gold, because I can see it serving my needs for the next year or two, but I don't know if it will continue to be valuable to me beyond that. And since the only PC options are the Green or Platinum, in all likelihood, I'll end up closing it. Would you still bother? Am I overthinking this?

I'm of the view that it's best to get only cards you are planning to keep. It harms your credit scores too much to open and close accounts.

Re: Short Term or Long Term Value?

Anonymous — Tue, 11 Jun 2019 23:27:10 GMT

I am with SouthJamaica on this. I generally only get cards that I can build and will provide ongoing benefits to me. There are a lot of apps that I have debated and almost pulled the trigger on that would be simply sub chasing with minimal benefit for use after the sub. From my perspective I want a card that I will continuously use.

Re: Short Term or Long Term Value?

Andypanda — Wed, 12 Jun 2019 02:22:41 GMT

Right now i am going for long term and what i call medium term benifits. I believe it is going to be a little white before i can the chse amazon prime (5/24 issues) and the citi dc with a decent sl. So i got the discove it card. I plan on using the card for a little over ayear and the sd it. I got the cap1 qs, which had helped a lot by giving me a high cl,mand help age my AAoA. Again, I will sd it when i get the citi dc. It served its purpose beyong just a sub. Th cc might not have made a lot of money off me since i pif, but i don’t think they lost money because they get plenty of swipe fees to make up for ehater bonuses i got.

Re: Short Term or Long Term Value?

wasCB14 — Wed, 12 Jun 2019 12:35:28 GMT

I already have cards that fit my spend well in terms of rewards and protections, so most of the value I might get from a new card is in the form of the bonus and perks.

The bonus is a short-term consideration, but several cards have valuable perks that merit the AFs: annual nights, credits, lounges, companion certificates, etc. Those are absolutely long-term considerations - just not ones that involve much ongoing spend.

It's fairly uncommon for me to get something without a nice bonus.

Re: Short Term or Long Term Value?

Anonymous — Sat, 22 Jun 2019 17:45:21 GMT

@SouthJamaica wrote:
@KLEXH25 wrote:
When you apply for a credit card, do you consider how well it will serve you in the long term? Or do you only consider your current, short term needs? I'm thinking of applying for the AMEX Gold, because I can see it serving my needs for the next year or two, but I don't know if it will continue to be valuable to me beyond that. And since the only PC options are the Green or Platinum, in all likelihood, I'll end up closing it. Would you still bother? Am I overthinking this?
I'm of the view that it's best to get only cards you are planning to keep. It harms your credit scores too much to open and close accounts.

In general, I tend to agree with this way of thinking... As long as the card doesn't have a killer AF, it's not doing you any harm by keeping for many years. You can just stick it in a draw, and maybe just pull it out to use it a couple of times a year just to show activity on your report, and to pick it a few points to balance out the AF, if there is one. But yeah, seems like you'd be doing more harm than good by closing a card that is helping to build up your overall AOAs, and good payment history. I have a $500 CL Cap One card that I don't really used anymore, since I have 7 others with much higher limits and rewards, but I am not going to close that $500 card since it has years of good payment history on it. I will just use it a few times a year to show it still has a pulse.

Re: Short Term or Long Term Value?

Anonymous — Sat, 22 Jun 2019 18:54:30 GMT

I guess I’m the only one who had my husband get Amex cards because I think they’re cool lol and don’t really care how much the annual fee is.

Re: Short Term or Long Term Value?

wasCB14 — Sat, 22 Jun 2019 19:30:13 GMT

@Anonymous wrote:
In general, I tend to agree with this way of thinking... As long as the card doesn't have a killer AF, it's not doing you any harm by keeping for many years. You can just stick it in a draw, and maybe just pull it out to use it a couple of times a year just to show activity on your report, and to pick it a few points to balance out the AF, if there is one. But yeah, seems like you'd be doing more harm than good by closing a card that is helping to build up your overall AOAs, and good payment history. I have a $500 CL Cap One card that I don't really used anymore, since I have 7 others with much higher limits and rewards, but I am not going to close that $500 card since it has years of good payment history on it. I will just use it a few times a year to show it still has a pulse.

If a card has a $39 AF (common on some old Cap1 cards) then trying to earn $39 worth of rewards on it isn't necessarily best. If someone is determined to keep an old card despite the AF, it could make more sense to spend $1 on it every few months to show activity and earn much more than $39 in rewards by directing the rest of the spend to other, better cards...cards someone may be using on an everyday basis.

Freedom is my oldest card and I'm certainly happy that there's no dilemma about whether to keep it open.

Re: Short Term or Long Term Value?

kdm31091 — Sat, 22 Jun 2019 23:29:22 GMT

I personally wouldn't apply for a card like the Gold unless it really meets your needs. The AF isn't waived and $250 is a lot to pay for a card if you aren't sure it's really beneficial for you. "Long term" with credit cards is relative. Programs change, sometimes for the better and sometimes not. If you compare cards that were available even 5 years ago to now, there are some considerable differences. The point is that it's a fluid market. Also, your spend and lifestyle habits can and do change. For example, you may eat out a lot now, but later decide it's better to eat at home more, meaning dining rewards may become less important. At the same time, you don't want to appear to be a churner, which banks are cracking down on more and more with various algorithims, and constantly opening and closing accounts makes you look that way.

So I'm somewhere in the middle. You can't expect to make a permanent portfolio because programs change, your lifestyle and spending habits change, etc, but you also don't want to appear to be churning (and it's not great for your credit to be constantly opening and closing accounts).