However, if you are looking into acquiring an airline rewards credit card, there
are a number of important steps you should take before diving in, and the best place
to start is to think about your personal needs in a rewards account.
Will airline miles be the right reward?
You may see offers for this type of card that promise tens of thousands of bonus
miles just for signing up, and many say they will even double that total if you
spend a certain amount within the first few months after you've opened the account.
However, it's important not to be sucked in by the first credit card offer you see.
Instead, you should think about two factors: First, for which airline does this
card let you earn miles? If it's one you've used in the past and generally liked,
that's all the better. However, if it is one you don't like or aren't familiar with,
you might want to keep looking. What good are airline miles if you are not sure
you're going to be happy with the experience when you redeem them?
Second, and perhaps more importantly, you need to think about how often you fly.
If you do so regularly, then this card may be exactly what you need to maximize
the savings your card allows you to enjoy. But if you are the kind of person who
travels only occasionally, there might be a more beneficial offer out there in the
realm of points or cash back rewards cards.
What's the cost?
While airline miles can be a great way to incentivize purchases, you'll also need
to think about what the new account you are opening will end up costing you. For
instance, many of these cards come with annual fees as a means of reducing the lenders'
cost of administering these programs, and at the same time, they tend to carry higher
interest rates than other types of cards.
For this reason, the credit card program you choose needs to be consistent with
your spending and debt repayment habits.
Here are a couple of real-life examples:
- If you carry a balance from one month to the next with regularity, will the value
of the miles you earn be greater than the added interest costs? If the cost of the
interest on you balance exceeds the value of you miles award benefit, you may need
balance transfer credit card applications instead.
- Alternatively, if you don't use your card very often, will you earn enough miles
to cover your annual fee? Also, unless for accumulate enough miles for an award
before they expire there’s really not much benefit there.
What's the value?
Further, you might also want to figure out exactly how much the miles you earn are
worth in terms of actual money. Every account is different, and therefore some will
reward you more heavily than others will.
In addition, many of these programs will also grant you more points for spending
on travel arrangements, not just booking flights. This can include booking rental
cars and hotel accommodations at your chosen destination. So if you can find a card
that rewards you more for purchases you would make in arranging your travel plans
anyway, perhaps that is the right card for you.
Again, it's always important to shop around, read the fine print of each
credit card application and familiarize yourself with a number of different
credit card offers before making a final decision, so that you know exactly which
card you're interested in will work best for you.
Research first, apply second
The Golden Rule of applying for a credit card is to research your
options before you apply. At CreditCardApplications.com we give you advanced tools
to compare credit cards relevant to your specific needs side by side
on a single screen.
Just go to out
credit card search engine page and answer the questions about who you are
and what you need. You can flip back and forth from viewing a ‘credit card snapshot’
to viewing ‘credit card details’ to speed the comparison process.
Once you’ve identified best credit card offer for Your needs, apply for a
credit card online and wait for a response. Filling out multiple credit card applications
can be counter-productive as it may trigger multiple inquiries on your credit report.
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