Hi Taylor - I just finished paying off my student loans and I’m wondering if I should get a new credit card to reflect my improved credit score. Does that kind of thing matter? Are the benefits significant?
Hey Shasta - Yes and YES. A better card with a higher limit can improve your credit even further, and the benefits offered by banks to people with good credit are usually much better than what one can get with poor or fair credit.
For starters, you should have access to lower APRs with your approved credit score. I don’t want you to carry a balance from month to month, but it’s always nice to have lower interest rates in case you do get caught with some outstanding charges on your card. A lot of cards will offer 0% APR on balance transfers as well, in case you have some lingering debt.
Most important will be access to useful perks. If you look good on paper, you can be trusted with the fanciest cards that bring in the fanciest rewards. Earn tons of miles and use swanky private lounges when you go to the airport; get a handful of cash back when you go to restaurants or pay for gas; apply for a card that links with your favorite airline or hotel to ensure your spending turns into rewards you can use.
Many of the best credit cards don’t really work unless you spend a modest amount, so you can’t expect to get much of a bonus if you don’t swipe regularly. That’s why it’s worth researching the cards that offer bonus points for certain types of spending. Some are better for business owners and frequent flyers, others work well for parents who have big families and spend lots of money on groceries each month. Some cards let you pick the benefits you’ll get the most out of, which is an appealing perk. There’s a post at gofarwithkovar.com that details 10 of the best cards for people with good credit, so that’s worth checking out if you’re in the early stages of your search.
Whatever you choose, don’t get too excited by the rewards. It’s nice to get a kickback for your everyday purchases, just don’t lose sight of the fact that you have to spend money in order to get these bonuses. If you work too hard to earn airline miles, you’ll quickly be back in debt and watching your credit score take a turn for the worse.
As long as you already use a credit card, it ought to be a good one. Start doing some research and find something that brings in useful rewards and reflects the excellent credit score you’ve earned, Shasta!
