Credit Card Offers Reward the Prudent and the Patient

Over the last few months I received three invitations from American Airlines/ American Express to sign up for a new joint AA-Amex credit card that would not have an annual fee as long as I kept my current American Airlines Citibank MasterCard as well.  As a sign-up bonus, the AA Amex card would give me 20% more miles during the first 12 months.  I assume this offer was sent to all AA Citibank card holders, and although I contemplated signing up for the card, I ultimately decided that 20% was not enough to convince me to add another card to my wallet.

We already wrote about checking your “junk mail” for interesting offers, but here I clarify that statement – don’t jump into any “junk mail” offer you get either.  Weigh the offer and consider your circumstances as well.  Naturally, if you accepted every single credit card invitation that included some kind of reward, you credit score would probably suffer while your wallet would likely be overflowing with cards.  Rather, when deciding whether to switch or take on a new rewards credit card, consider how it fits with your other cards.  Is the new card offering you a 1% cash back on everything when you already have a card that offers that?  Does it make sense for you to take on a new credit card with a different rewards program and split up your point accumulation?  That’ll largely depend on whether each of the reward schemes offers something unique and valuable to you, the reward rate of each card, as well as how much you put on your credit card each month.  If your credit card bill is small and it already takes you a while to accumulate enough points for a reward, for example, splitting your purchases between two cards will mean it’ll take even longer. Continue reading

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