A recent survey shows that a person will stay committed to one credit card for years. In fact, 25 million consumers stick with their favorite credit cards for more than 10 years. Most consumers have never stopped to consider whether the credit card they are using is the right one. If you fall under this category of consumers, perhaps it is time to get a new credit card. If you want to improve your financial fitness in 2021, applying for a new credit card should make it to your financial to-do list.
But again, if the credit issuer has been good to you, it wouldn’t make any sense to switch your card. What you need to understand is that there are tons of different credit cards in the market. Each card has its terms and conditions and therefore, it is good to ensure that the card you are using is the best.
Like many people, if you are unsure whether your card issuer is giving you all the benefits you’re supposed to be getting, here are the five signs you should shop for a new card.
No Real Rewards On your Card
In most cases, you will find that your rewards are not matching your level of spending. Most credit cards will give you certain benefits or rewards for certain purchases. If you are a regular traveler or a business owner who makes sizeable purchases on your card and frequently, doing this without getting any benefits from the credit card company will be just a waste of your money.
It doesn’t matter how you are spending your cash, whether traveling or daily purchases, having bonuses or rewards for your efforts will be a great addition to your card.
The good thing with the credit card rewards is that they often come with no annual fees, which means you could be earning back hundreds of dollars each year. Some other types of credit cards will reward the users with points or even cash backs for the purchases. Is your credit card giving you any benefits or rewards?
If You Are Paying A High Annual Percentage Rate
Typically, any credit card that carries a balance attracts a high interest and you should work on paying off what you owe. That is in an ideal world, which unfortunately we do not live in. Sometimes we may be forced by circumstances to carry credit card debt for months which may extend to years.
If you currently owe a balance on your card, and you realize that you may be paying a high APR, it may be time to consider a balance transfer credit card. These are special cards and come with 0% promotional interest rates for months at a time. Some of these balance transfer credit cards do not even charge a transfer fee from your old card to the new one.
Just imagine transferring a high-earning interest debt into a new card with no interest for a while. Could do to your financial situation. You could pay off the debt at a much lower cost. Be careful though, there is a catch here, it is important that you check what the interest rate will be once the promotional period lapses. It may happen that the interest rate you will be charged will be higher than what you are currently paying.
If you do not owe any balance on your card right now, but you sometimes do, you must compare the card’s annual percentage rate to the card’s competitors. If you find a card with a lower APR, it may be worth making the switch.
If You Are Paying To Be A Customer
Sounds ridiculous right? Well, it happens! Some cards will charge you annual fees for the privileges of being a customer. Well, there is nothing wrong with getting some privileges but you do not have to pay as long as they are worth it.
Some of the cards with the highest annual fees offer their clients benefits such as free nights in hotels, access to airline lounges, and such. But you may not be using all these are privileges right because of the pandemic.
The bad thing is that, when life returns to normalcy, your circumstances may have already changed. Therefore, you must consider whether an annual fee is still worth it. If indeed it’s not, you may downgrade your card to a free one and the good thing is that you will not lose anything in terms of your history.
If you haven’t Received any Credit Limit Increase In A Long Period
If your credit limit has been stagnant for a while, it may be time to change your card, especially when your credit score and income have increased. Well, some credit cards will cap their credit limit which will apply to everyone regardless of their incomes or other factors. You must consider other credit cards that will get you approved for a limit increase.
If Your Credit Card Rewards No Longer Fits Your Lifestyle
Some credit card rewards will only be fitting for a certain lifestyle. For instance, you may have gotten a card with travel rewards just because you liked to travel a lot, today, you are no longer a traveler. This makes the card useless. Other causes may be a rewards mismatch. Consider a consumer who spends a lot on gas. With a basic reward card, which rewards you just 1 point for every purchase, you will be missing a lot compared to a gas rewards card that will reward you for purchases on gas at a higher rate. If you are not utilizing your credit card rewards properly each year. It may be time to consider a new option that may be more beneficial to you.
If you are not getting any real tangible benefits from your credit card, it may be time to make the switch. A new credit card opens a new world of possibilities. However, you have to be careful not to overdo it. Continue to charge your card only what you can afford and make sure to pay in full to avoid high APR.