topic Re: Spreading yourself too thin in Credit Cards

Spreading yourself too thin

kdm31091 — Wed, 09 Sep 2015 00:38:10 GMT

This post is really just a general rant/commentary based on recent musings in my head. I have nothing against people who want to carry 15 cards to maximize their rewards on every single transaction. Increasingly, though, I realize that it just isn't for me. Wondering about which card to use for which transaction, after a certain point, becomes a headache. It takes up too much time and effort that I could be spending on more fruitful activities. For example, due to having what I feel is "so many" cards, I accidentally had opted for department stores as my 2nd 5% category on Cash+ for Q3, despite Discover offering it (and doubled at that!).

We often get very caught up in maximizing our rewards, and sometimes I think it reaches the point of silliness. Let's just assume one is an "average" spender, with an average amount of expenses each month. I'll just call that $2000 a month in spending, though some do definitely spend less than that.

Say $300 of that is groceries. $200 in gas. $300 in dining. The rest are just random transactions not under a bonus category (trying to keep this simple).

On my BCP, if I put every single dollar on it for the month, I'd have $1200 at 1%, $200 at 3%, $300 at 1% for dining, and $300 at 6%. This comes out to $39 for that month.

Of course, putting that same exact spend on my Double Cash unilaterally would net me $40, despite the fact that the BCP's percentage on certain things is much higher.

The point is that sometimes we get wrapped up in category bonuses, but if you are spreading your spend across 10 cards, you will take a very long time to rack up any meaningful numbers of rewards, and often, may find you get the same or better rewards by consolidating on to less cards. I am not giving up or closing any cards at this point, just musing that really, it often isn't worth spreading the spend around (now if your spend is higher, it would be more of a difference obviously, and the points cards offer the potential of more value if one travels and can make use of the points, etc).

Say you have a BCP for groceries and gas, then you throw your dining onto an AARP. So that $300 a month now just earned an extra 2%. Which means $6 over your BCP. Ok, great. But the DC spend netted $1 more than BCP, so really, you gained $5 a month with the AARP, yet that $5 is seperated onto a different card with a different system. Is it really worth it?

I find myself missing the days when I just spent pretty much everything on Discover and QS. It was simpler, and didn't take up as much time mentally (or as much wallet space lol).

Chime in with opinions about spreading rewards vs consolidating them .

Re: Spreading yourself too thin

CreditCuriosity — Wed, 09 Sep 2015 00:46:18 GMT

Although you don't want to hear this.. Most people have alot of cards for the SIGN-UP bonuses! I really only use 2-4 cards normally and use the other cards to keep them active.. So yes most of my spend is going on 2-4 cards(so high reward amounts on these 2-4 cards). Obviously putting the initial spend and token spend on other cards to keep them active let them age. Then repeat on the bonuses when new cards come available or it is available to be done again in 24 months or whatever. You get what I am saying. I am sure alot of the other people on this forum probably do similiar things like myself.

Re: Spreading yourself too thin

kdm31091 — Wed, 09 Sep 2015 00:46:34 GMT

Right, but I'm talking about day to day spending, excluding the initial boost of the bonuses. Should have made that more clear I know plenty of people app for cards purely to get the bonus.

Re: Spreading yourself too thin

Open123 — Wed, 09 Sep 2015 00:54:03 GMT

In general, I definitely agree with you.

Less is more, especially with rewards cards. All things equal, it's best to chose a single program, and focus spending on that particular card. Aside from my litany of sign-up bonus cards, all of my spending are through only a few cards--SPG, Inks, and EDP. For non-Amex charges, I'll use the JPM Ritz for the initial $10K, then Visa GCs purchased from by my EDP/Ink from the Supermarket and/or Office stores.

That's it, really. Aside from the above, I'll eventually close all the rest of my cards, and likely never app again when the sign-up promo era ends.

Re: Spreading yourself too thin

BungalowMo — Wed, 09 Sep 2015 01:13:48 GMT

I totally see what you're saying. Initially I apped to finally get some great, prime cards with nice limits. Then I went for the nice signup bonus cards.

Now, since I do have a couple cards with balances (Had to take 3 trips back home in 2 & 1/2 years & one more in Oct!) I want to get a nice balance transfer card with a 0% transfer & 15 to 18 mos 0% int.

My "daily drivers", if you will, are my AMEX BCP & Discover. Those rewards are nice without having to keep track of what's what.

Re: Spreading yourself too thin

Callandra — Wed, 09 Sep 2015 01:14:21 GMT

I definitely do agree with this! But I do feel like the bonus maximizing is something that only the credit obsessors like us do; I know my parents do not. My parents have a BCE, Marriott Visa, and some Citizen's Bank MC. I think they mostly use the BCE and Marriott cards and they alternate them throughout the month and they don't pay attention to bonus categories so much. I think most people just get 1-3 cards and just use those.

Kind of a carryover from another thread, but with cards like Freedom, Discover IT, or Sallie Mae, the CC companies count on both/either you using the card for all your spend (outside the bonus categories) or that you'll carry a balance and they will make money on the interest. And I think *most* people probably do that. I know my fiance mostly uses his Sallie Mae (sometimes he uses his QS for bigger purchases since it has a higher limit), regardless of bonus categories. I find myself mostly swiping Sallie Mae regardless of what I'm buying.

Even for moderate spend, I don't think having more than 3-4 rewards cards makes sense (since as you say kdm), you wind up with a few dollars spread too thin over too many cards. I find using Sallie Mae only, I rack up points really fast. I cashed out $42 at the beginning of August and I am back to 2500 points again already. I'm a low spender ($500-800 a month) but until you get to big spend, I don't think the difference between a 3% bonus category and a 2% one will make that much of a difference. Even in another thread lately, a poster was asking about getting an AARP (3% on dining) versus using Citi Double Cash. The difference was only a few dollars a month and it's up to the individual whether it's worth having another account or not.

I find having too many accounts to monitor is a pain which is why I closed my Rewards and VS cards. Eventually QS will replace Freedom but that'll just be SD'd since I bank with Chase and I can monitor Freedom whenever I look at my checkings account.

Re: Spreading yourself too thin

kdm31091 — Wed, 09 Sep 2015 01:18:09 GMT

@Callandra wrote:
I definitely do agree with this! But I do feel like the bonus maximizing is something that only the credit obsessors like us do; I know my parents do not. My parents have a BCE, Marriott Visa, and some Citizen's Bank MC. I think they mostly use the BCE and Marriott cards and they alternate them throughout the month and they don't pay attention to bonus categories so much. I think most people just get 1-3 cards and just use those.

Kind of a carryover from another thread, but with cards like Freedom, Discover IT, or Sallie Mae, the CC companies count on both/either you using the card for all your spend (outside the bonus categories) or that you'll carry a balance and they will make money on the interest. And I think *most* people probably do that. I know my fiance mostly uses his Sallie Mae (sometimes he uses his QS for bigger purchases since it has a higher limit), regardless of bonus categories. I find myself mostly swiping Sallie Mae regardless of what I'm buying.

Even for moderate spend, I don't think having more than 3-4 rewards cards makes sense (since as you say kdm), you wind up with a few dollars spread too thin over too many cards. I find using Sallie Mae only, I rack up points really fast. I cashed out $42 at the beginning of August and I am back to 2500 points again already. I'm a low spender ($500-800 a month) but until you get to big spend, I don't think the difference between a 3% bonus category and a 2% one will make that much of a difference. Even in another thread lately, a poster was asking about getting an AARP (3% on dining) versus using Citi Double Cash. The difference was only a few dollars a month and it's up to the individual whether it's worth having another account or not.

I find having too many accounts to monitor is a pain which is why I closed my Rewards and VS cards. Eventually QS will replace Freedom but that'll just be SD'd since I bank with Chase and I can monitor Freedom whenever I look at my checkings account.

QS is truly a tough card to beat. Yes it's 0.5% less than DC, but it's given right away, with no headaches, no redemption min, etc. Although one doesn't normally redeem tiny amounts anyway, it's just nice how cut and dry Capital One is with the rewards.

Re: Spreading yourself too thin

UncleB — Wed, 09 Sep 2015 01:22:59 GMT

I hear 'ya!

I believe there's an 'optimal' number of cards, and for me, I'm definitely there, although my wallet is quite a bit 'thinner' than most folks on here.

If anybody's counting, the number of cards that I actually 'use' is four - Discover (categories), BCP (groceries), Sam's MC (hotels and restaurants) and the Quicksilver for anything else. At the moment, it's actually three since the Discover is a 'de-facto' 2% cash back for general spend during the promo, so the Quicksilver gets very little love these days.

Having any more than this would honestly be silly for my own spending amount, but I'm certainly not going to judge others. I know I'm probably not typical (at least on this forum) and many if not most people have spending quite a bit higher than mine. That's OK, though... my method works for me!

As for the folks who use a fist-full of cards, while I know it wouldn't work for me, I enjoy reading about how they divvy everything up and chose 'what goes where'. While I would find it exhausting, I think for those folks they probably see it more like a game than a burden. And, as an added bonus for me, sometimes I'm able to pick up a tidbit of knowledge to tweak my own meager rewards!

Re: Spreading yourself too thin

Anonymous — Wed, 09 Sep 2015 01:27:58 GMT

I definitely agree with this.

I just switched myself and my DW to using our Citi DC for all spend. 2% back on everything, keeps all the rewards in one place, and one bill to pay. I have an Amex BCE card as well, and I could get 3% back on groceries with it, but to me having one bill to pay and one rewards to redeeem in kinda nice.

Re: Spreading yourself too thin

Anonymous — Wed, 09 Sep 2015 01:44:00 GMT

Im tired of all these cards to be honest. The thrill is gone. My goal is closing everything that doesnt serve a purpose and isnt used regularly this year, use the latest card for a major purchase which I plan on taking my sweet time paying off while its in a 0% intro and the rest use as needed but PIF each month. That will leave me with a balance on one card and six total...but I might also cut SM #2 after moving the limit over for simplicity reasons. Having two is nice but I could certainly live without it. As of now here's how my spending goes.

SM #1 - 5% groceries, gas & Nook books
SM #2 - 5% Target & Wal-Mart (could use Discover for Wal-Mart online 5% instead)
Ink Cash - 5% cell, cable & internet bills + 2% dining
Discover - mainly Discover Deals + rent & misc spend that doesnt fall under covered categories

Others I dont use and would like to close except BCE. Backdate, credit line and EX FICO are helpful.

Re: Spreading yourself too thin

Kidcat — Wed, 09 Sep 2015 01:46:14 GMT

I agree that less is better. With that said, many (not all) on this forum are rebuilders, myself included. I think (and I'm speaking for myself) that some of the Apps were to get back "in" with a certain creditor, or to have some validation that the credit issues of past are truly being left in the past. You add the feeling of finally getting cards from which you were shut out, with the sign up bonuses for cards, and many have cards that overlap with regards to rewards.

At least for me, there will be a lot of downsizing and/or combining where possbile. Live and learn

Re: Spreading yourself too thin

CreditCuriosity — Wed, 09 Sep 2015 01:47:52 GMT

@Anonymous wrote:
Im tired of all these cards to be honest. The thrill is gone. My goal is closing everything that doesnt serve a purpose and isnt used regularly this year, use the latest card for a major purchase which I plan on taking my sweet time paying off while its in a 0% intro and the rest use as needed but PIF each month. That will leave me with a balance on one card and six total...but I might also cut SM #2 after moving the limit over for simplicity reasons. Having two is nice but I could certainly live without it. As of now here's how my spending goes.

SM #1 - 5% groceries, gas & Nook books
SM #2 - 5% Target & Wal-Mart (could use Discover for Wal-Mart online 5% instead)
Ink Cash - 5% cell, cable & internet bills + 2% dining
Discover - mainly Discover Deals + rent & misc spend that doesnt fall under covered categories

Others I dont use and would like to close except BCE. Backdate, credit line and EX FICO are helpful.

Bet you will still open cards for Free hotel nights / flights then close them .. I agree KISS (keep it simple stupid) on only using 2-4 cards normally, but the bonuses are to good to turn down lol. What happened to that Hyatt you had ...

Re: Spreading yourself too thin

kdm31091 — Wed, 09 Sep 2015 01:50:35 GMT

Bonuses are an individual thing. I don't personally get excited about them, unless it's a card I otherwise find useful and am applying for anyway. Just keep in mind every card you open "just for the bonus" stays with you for 10 years on your report. To me, that's a pretty big price to pay for a one time bonus. The system is designed that way ostensibly to discourage many credit applications, as on manual review, I imagine that 50 open and closed credit cards doesn't look too great. I'm not an underwriter though.

Re: Spreading yourself too thin

CreditCuriosity — Wed, 09 Sep 2015 01:57:10 GMT

@kdm31091 wrote:
Bonuses are an individual thing. I don't personally get excited about them, unless it's a card I otherwise find useful and am applying for anyway. Just keep in mind every card you open "just for the bonus" stays with you for 10 years on your report. To me, that's a pretty big price to pay for a one time bonus. The system is designed that way ostensibly to discourage many credit applications, as on manual review, I imagine that 50 open and closed credit cards doesn't look too great. I'm not an underwriter though.

Keep them open for several years on some of them others close out after a bit.. Keep in mind some of us are alot older than others and have alot thicker profiles that can support this meaning multiple mortgages, cars, etc reporting.. If is doesn't goto manual review then you are set. My AAoA is pretty much not an issue as I have Amex backdating to 1990 along with alot of other VERY old stuff on my credit profile.. I can care less if X bank thinks I am churning as they are using me as well for a profit, correct? They just won't get it off me other than an AF, but I surely will come out ahead on rewards, make no mistake on that. Different strokes for different folks. I came to this forum to rebuild and still rebuilding, but my scores are healthly enough to start playing this game we call credit.. It is played by the lender and the lendee. Some hate to refer to it as a game, but for alot of us it is.

Re: Spreading yourself too thin

Anonymous — Wed, 09 Sep 2015 01:55:18 GMT

Hyatt served its purpose and was closed CC Im going to enjoy my two nights in Montego Bay for New Years but honestly making this a regular thing isnt for me. Experience with Aviator and Hyatt cards were enough. Id rather use a discount site like Orbitz, Hotwire or Priceline (no I dont want those cards either) and get a cheaper price from the start as I have in the past than meet anymore spend requirements. Trying to maximize every point and penny with cards isnt a priority.

Re: Spreading yourself too thin

kdm31091 — Wed, 09 Sep 2015 01:56:21 GMT

@Anonymous wrote:
Hyatt served its purpose and was closed CC Im going to enjoy my two nights in Montego Bay for New Years but honestly making this a regular thing isnt for me. Experience with Aviator and Hyatt cards were enough. Id rather use a discount site like Orbitz, Hotwire or Priceline (no I dont want those cards either) and get a cheaper price from the start as I have in the past than meet anymore spend requirements. Trying to maximize every point and penny with cards isnt a priority.

And sometimes the deals you get through those sites are better than even "maximized" points!

Re: Spreading yourself too thin

CreditCuriosity — Wed, 09 Sep 2015 02:00:24 GMT

@Anonymous wrote:
Hyatt served its purpose and was closed CC Im going to enjoy my two nights in Montego Bay for New Years but honestly making this a regular thing isnt for me. Experience with Aviator and Hyatt cards were enough. Id rather use a discount site like Orbitz, Hotwire or Priceline (no I dont want those cards either) and get a cheaper price from the start as I have in the past than meet anymore spend requirements. Trying to maximize every point and penny with cards isnt a priority.

Oh I agree I don't maximize everything as it is a pain in the arse and I can make alot more money doing other productive things. Certain things are obvious eating out goes on CSP (granted on Plat now to meet spend in a month+), Amazon on SM, you get the gist. As Stated I believe in KISS. I will continue to get sign-up bonuses such as Amex Plat 100k as I have now (2-3k on airlines is a no-brainer) along with the 140k ritz when it comes back around(another no brainer for me), etc.. Overall I agree a few cards for most spend though

Re: Spreading yourself too thin

Anonymous — Wed, 09 Sep 2015 02:03:38 GMT

Mine is pretty simple since I buy very little outside of necessities. Groceries and gas on Sallie Mae. Office supplies, cell phone and shipping on SimplyCash. Normally general spend on QS. Right now, though, general spend is going on Discover. Toss an occasional small bone to the other cards.

Re: Spreading yourself too thin

red259 — Wed, 09 Sep 2015 02:21:36 GMT

@kdm31091 wrote:
Right, but I'm talking about day to day spending, excluding the initial boost of the bonuses. Should have made that more clear I know plenty of people app for cards purely to get the bonus.

I don't think there are many people who are spreading spend across a lot of different cards. Assuming I'm not meeting initial spend then I spend the following way all cable/phone/office supplies go on ink bold (these are not everyday expenses but like once a month), all grocery spend goes on amex everyday and pretty much any small amounts to count towards my 20 transactions, all non-cat spend that is not small goes on my amex spg (again not an everyday thing and would apply to purchases of more than $50). The only other category is restaurant/travel and I will probably use the citi premier for those, but I haven't decided yet. If the freedom has a 5x category it subs in for whatever card covers that category. For more obscure bonus spend categories or amex offers etc I don't bother losing sleep over that. Everything else goes in sock drawer. On a daily basis I am usually just using the everyday card. I will switch things up if I need additional points in a specific program or something, but its really simple for me to keep track of which card goes for what. I could put all my spend into just one program, but then I may run into a problem later on when I go to redeem and I do not have as much flexibility and may not be able to find a flight I want or if I do it could cost a ridiculous amount of points. I also enjoy spending this way so there is that too. If I only wanted cash back I'd probably use just one card or maybe two total.

Re: Spreading yourself too thin

Open123 — Wed, 09 Sep 2015 02:48:40 GMT

Actually, come to think of it, on every card (aside from the ones I mentioned), once I've earned the bonus, it goes unused until time for cancellation. I care so little about these cards, I don't even keep them when they ofter retention bonuses. Matter of fact, I've closed them even when they offered to waive the fee.

I definitely believe in the scorched Earth policy when it comes to CCs.