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Long-term credit card goals?

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Long-term credit card goals?

Hi all,

 

I'm a college kid with two cards at the moment - student Discover ($1350 CL) and the Uber Visa ($1500). I'll be graduating fairly soon, and I'm curious what a good "next move" might be in the credit card world. Some other potentially-important factors:

 

- FICO around 740, oldest account 1.5 years, AAoA little under a year

- Currently two student loans for $10k (subsidized until 6 months after graduation) though I'll probably end up with $17-20k at graduation

- Degree will be in engineering but likely to end up in tech consulting (potentially lots of travel, at least for a while)

- No late/missed payments, utilization varies but generally 10-20%, score seems to be held down mostly due to AAoA

 

Any advice for short and long term credit goals - should I be looking at other cards now or soon? Which ones should I keep in mind further down the road? Don't have a lot of expenses now (few thousand $$ per year) but that'll change quickly once I'm in the "real world"

 

Thanks!

8 REPLIES 8
Established Contributor

Re: Long-term credit card goals?

Well if you intend to put rewards toward travel, I'd look at at least either one of the premium cards like Amex Platinum, Sapphire Reserve, CNB Crystal, etc, and/or a 'trifecta' from Amex (Amex Platinum/Gold/Blue Business Plus and/or Green card pending upcoming changes) and/or Chase (Sapphire/Freedom/Ink Cash and/or Freedom Unlimited) for earning MR or UR points. There's also TY points from Citi, but I mean, let's just say compared to Chase and Amex, Citi is currently like a 90s college dropout circa 1998: they had it going on, but they got too far up their own ass and now they're busy finding themselves (possibly hanging out at coffee shops and getting high in the drive thru at McDonald's [not that there's anything wrong with that])

Also consider the PenFed Pathfinder, since it gives a $100 travel credit and global entry for no annual fee - this is a great supplemental card to any annual fee travel card: for a $95 annual fee card like the Sapphire Preferred, the Pathfinder credit fully offsets the annual fee and adds the other aforementioned benefits. For a premium card like the Amex Platinum, it bolsters the credits youll already get from that premium card. You can also consider a hotel card that will give you positive expected value. The Hilton Aspire is nice cuz in year 1 the travel credits alone more than offset the annual fee, diamond status is great and I used the $250 resort credit at a Waldorf Astoria which was great especially with Diamond status. You can always downgrade that card to the no annual fee version in year 2 if you don't like it.

Your next best bet is focusing on 5% cash back cards, which long term can still supplement one of the above strategies.

I'd suggest looking at the places you wish to travel, which point system between UR and MR (and maybe even TY points) has the best travel partners for your plans, and what airport lounges are at your most used airport(s) to see which card will offer you the best lounge access for your situation.
Chase UR: Amex MR:Citi TY:
Cash back:Travel:
Debit: + DCU savings acct for 5.12% APY for $1k
Message 2 of 9
Valued Contributor

Re: Long-term credit card goals?

I would say wait until you figure out what your future job really does include.  If it you see yourself traveling quite often then it would make sense to go for this type of card.  While the Uber provides 3%, some of the nice travel cards have an annual fee.  It doesn't really make sense now to get one.  

 

Most people do need groceries and gas so you may want to consider a card now that provides some decent rewards as this is a given the rest of your life.  You can consider a general 1.5% - 2% general spending card as this can be used now and the rest of your life.

 FICO 8
Message 3 of 9
Established Contributor

Re: Long-term credit card goals?

Over medicated makes a good point but if you want to get on with especially chase eventually it's still a good idea to get the freedom card now since there's no fee and you can start building history with them. If you want to go Amex eventually I'd say hold off til the platinum makes sense so you can lock in the 100k sign up bonus (it's rarely if ever available to preexisting Amex cardmembers)
Chase UR: Amex MR:Citi TY:
Cash back:Travel:
Debit: + DCU savings acct for 5.12% APY for $1k
Message 4 of 9
Valued Contributor

Re: Long-term credit card goals?

First, congrats for being so impressively level headed and forward looking at this age.

 

You don't need to worry about amex cards now, although they are great, you don't have a immediate need, and I'm sure when times come and you are certain about your need, you can get them with ease.

 

For now, due to the 5/24 rule of chase, and the fact you already have uber card which has nice category spending, I would suggest you get a chase freedom unlimited. This will be a general spending card give you 1.5% on everything, and get you into chase system. If you save these points and use it later on travel when (if) you get a CSR, this would be 2.25% on everything. This could be a short term, and long term baseline card.

 

For the long term, you will have to acquire a couple cards with more rewarding category spending, then see if you want to chase SUB from that point forward. Once you have a better idea about your category spending after graduation, you can look into many options available.

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Message 5 of 9
Established Contributor

Re: Long-term credit card goals?

I’d start out with Chase first, before moving on to Amex. So maybe a CF, potentially a couple Ink cards, and a CSR. As time passes and you settle down, you’ll know which airlines/hotels work best for you and you can go from there.


[2/2019]
Message 6 of 9
Valued Contributor

Re: Long-term credit card goals?

My goal is to reduce my portfolio from seven cards to five cards.  My wish is that Chase would introduce a new credit card giving 3x points for groceries.

Chase Sapphire Reserve • PenFed Power Cash Rewards • and five cards in the sock drawer

No CC debt • No bonus chasing • No app sprees • No gift cards • No AZEO • No airline incidentals • No hotel cards • No store cards • No business cards • No authorized users
Message 7 of 9
Established Contributor

Re: Long-term credit card goals?

Chase doesn't seem to have the freedom categories conflicting with any of its other UR cards, so I wouldn't hold my breath for a card doing 3x on groceries. Besides frankly it should be at least 4x to keep up with Amex Gold
Chase UR: Amex MR:Citi TY:
Cash back:Travel:
Debit: + DCU savings acct for 5.12% APY for $1k
Message 8 of 9
Established Contributor

Re: Long-term credit card goals?


 

@minneDomer wrote:

Hi all,

 

I'm a college kid with two cards at the moment - student Discover ($1350 CL).

Keep this card for a very long time. It will help you with your AAoA down the line. Since it has no AF, there's no cost to you. 

 

- FICO around 740, oldest account 1.5 years, AAoA little under a year

 

Definitely don't apply for anything until your AAoA reaches 18 months. The extra 6 months will give you a buffer so that your AAoA doesn't drop below one year. Work towards a minimum AAoA of 2yrs, and once there keep it there. Rinse & repeat.

 

@Overmedicated wrote:

I would say wait until you figure out what your future job really does include.  If it you see yourself traveling quite often then it would make sense to go for this type of card.  While the Uber provides 3%, some of the nice travel cards have an annual fee.  It doesn't really make sense now to get one.  

 

Most people do need groceries and gas so you may want to consider a card now that provides some decent rewards as this is a given the rest of your life.  You can consider a general 1.5% - 2% general spending card as this can be used now and the rest of your life.


I agree with @Overmedicated. Don't go out and start applying for cards left and right until you know what your job and lifestyle will be. Take advantage of your youth and focus on the credit fundamentals like not making poor credit/purchasing decisions, building a good payment history, and refrain from applying for credit you don't need.

 

If you feel you need a new card later(remember to be mindful of AAoA), I would sign up with a good credit union and apply for one of their cards. PenFed seems to be the choice of this forum. You hit two birds with one stone as you get a new card, and you build a relationship with a potential lending source for future mortgages, auto loans, etc.











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Message 9 of 9
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