Monday - Nov 20, 2017

Follow these 4Ss before applying Credit cards


Here are some ground rules that we should follow when applying for credit cards. Applying for Credit cards is one of the fastest and easiest way to acquire miles and points.

This hobby of collecting Miles and Points is not a Sprint, but a Marathon. If we follow these 4Ss when applying credit cards, we can enjoy greater returns over a long period.

Save your Credit Inquires for Home/Auto Loan:  

If you are planning to get Home/Auto Loan, you should stop/slow down with credit cards and watch out for your credit score. Having a good credit score will help you get lower APR on your Home/Auto Loan. Having so many inquiries on your credit report will be considered as risk.

Lower APR will save you a lot of money on interest than the miles you earn from Credit Cards.

Start slow:

When I started this hobby, I got excited after getting my first 2 credit card approvals and applied for several other cards in a short time. As you might have expected, I was denied for many of the cards afterwards.

Also, most Credit card offers requires minimum spending in a set amount of time for the sign up bonus, only apply if you are comfortable meeting the minimum spend requirements.

It is recommended to start slow and understand how your credit score is reacting to a hard inquiry, I would not be comfortable applying for Miles and Points credit cards if the Credit Score is less than 720.  I have seen folks applying for Credit cards after a set amount of days (91 days or 181 days) to avoid hard inquires on a regular basis.

Spend within your limit:

It is very tempting to buy something that is not needed to meet the minimum spend requirements. This could cost you a lot more than the miles you earn.

In the next few days, I will write another post explaining the techniques to meet minimum spending with minimum out of pocket expenses.

Ship your payments on time:

If you are looking to carry balance on your Credit card, Miles and Points Credit cards may not be the right choice. Miles and points Credit cards usually have high APR’s and you will not come ahead paying interest.

It is important to pay your bills on time, if you want to take advantage of Miles and Points

Conclusion

We need to remember that this hobby is a Marathon. To keep enjoying these credit card offers on a long run, we need to follow these simple rules.

Save your inquiries for Home/Auto Loan, Start slow, Spend within your limits and ship your payments on time.

Editorial Disclaimer: Content provided on this site including any opinions, analysis, information provided here are those of the author’s alone, and have not been reviewed, approved or endorsed by any Airlines, Financial Institutions or Experts.

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