Life is always changing, and you need a credit card that keeps up with you. Your financial needs and credit situation may have changed since you first applied for a credit card. If you’ve been using the same credit card for a long time, it may be time to switch to a credit card that works even harder for you.
According to a credit card survey by Debt.com, most respondents (44%) only have one card that they actively use. About 1 in 5 respondents said the last time they signed up for a new credit card was over five years ago.1 Let’s look at a few of the advantages and disadvantages of opening a new credit card.
Perks of a New Card May Include …
Better reward points and cash-back offers. With the wide range of rewards cards now available, it’s a great opportunity to start earning more points or cash than ever for your purchases.
Lower interest rates. If you don’t pay off your credit card in full each month, then you may want to switch to a card with a lower interest rate. Even if the rates you’re offered are similar to your current card’s, you may be able to lower your costs temporarily thanks to introductory interest rate and/or offers.
No annual fee. You may qualify for a rewards card that doesn’t charge you an annual fee. Instead of this fee, these cards tend to charge larger foreign transaction fees and give reduced rewards. This tradeoff may be appealing if the annual fee on other cards is larger than what you’ll earn from rewards.
Demonstrating your ability to balance multiple cards. If you keep your old card open (and active) in addition to getting a new one, then you can improve your credit score. Just keep paying off your credit cards on time to show your reliability.
Beware of …
Spending more than you do now. You may be tempted to spend more money to earn more rewards. Don’t change your spending habits if it means you’ll be unable to pay off your credit card debt on time each month.
Closing old cards.
Closing your old card can have a negative impact on your credit score. It could shorten the length of your credit history. Plus, if closing old cards leaves you with just one credit card, you’ll be spending a greater proportion of your available credit.
Missing payments. If you’re using more than one credit card for the first time, be careful about letting payments slip under the radar. Consider opting in to automatic monthly payments to prevent any late fees.
Applying for many cards at once. Applying for multiple credit cards within a short time period sends a red flag to creditors. You’ll be seen as a greater risk, lowering your credit score and possibly causing rejections or higher interest rates.
Choosing the Right Card for You
Ready to explore your credit card options? Use Amegy Bank’s credit card comparison tool and learn more about our lineup of credit card options. It’s quick and easy to apply online for an Amegy Bank Visa® credit card.2
1 Source: Debt.com 2021 Credit Card Survey
2 Credit card accounts are subject to credit approval. Certain terms, conditions, and restrictions apply. See the credit card application and disclosures for more details. Offers are available for new credit card accounts only and subject to change at any time.