Year-end wallet audit: Cards to keep/cancel for 2017

wallet with cardsIt’s common to take stock of your life this time of year. But have you taken stock of your wallet?

Cards that may have been a good fit years ago may no longer be. And the card industry changes so quickly that there are probably plenty of cards you haven’t considered – and should.

As our forum members like to say, YMMV (your mileage may vary). But here are some cards to re-evaluate if they’re in your wallet – and consider if they’re not.

Cards to keep/consider

We consider the following cards to be an asset in many wallets. So if you have them, hold on – if you don’t, keep them on your radar.

1. Chase Sapphire Reserve

This card launched in 2016 amid great fanfare, and the hype was largely deserved. In fact, we gave the card 5/5 stars in our review.

The $450 annual fee may seem daunting, but, with its $300 annual travel credit (which is far more flexible than the travel credits offered by similar cards). You get a 50 percent bonus on redemptions in Chase’s travel portal as well as Global Entry/TSA PreCheck reimbursement and lounge access.

If you dine out and travel a lot, this card’s perks justify the steep annual fee.

If $450 a year is still too much, consider the more affordable version of this card – the Chase Sapphire Preferred. The benefits are toned down, but it’s still a rewards powerhouse for travelers and just $95 a year.

The information related to the Chase Sapphire Reserve has been collected by CreditCardForum and has not been reviewed or provided by the issuer of these cards.

2. Blue Business℠ Plus Credit Card from American Express (a CreditCardForum advertising partner)
We’d like to put it on your radar if you’re a small business owner who doesn’t want to worry about tracking spending categories, doesn’t want to pay an annual fee and wants to earn Membership Rewards points.

You’ll earn: 2X points on everyday business purchases such as office supplies or client dinners. The 2X applies to the first $50,000 in purchases per year, 1 point per dollar thereafter.

And these are Membership Rewards points, remember – a valuable and flexible rewards currency. The card has no annual fee, making it the only no-annual-fee AmEx business card to earn MR points.

3. Starwood Preferred Guest card
Here’s one for the get-it-while-you-still-can category. Starwood and Marriott merged this year, but the co-branded Starwood credit card is still available. It’s a stand-out hotel card because it earns Starpoints, a highly valuable currency that you can transfer (via Starwood’s rewards program) directly to more than 20 airline partners.

True, you could just get the Marriott card and transfer to Starwood’s program (which the merger now allows you to do). However, because of the high worth of Starpoints, you’d lose some value in that transfer. So consider getting the Starwood Preferred Guest card while it’s still available and snagging its sign-up bonus. When the merger is officially complete, any remaining Starpoints you have will just transform into Marriott points and your account will likely become a Marriott card.

4. A catch-all cash-back card of your choice
The past year has seen the market flooded with cards offering 1.5 percent cash back on everything (here’s a list). Most of these have no annual fees. There’s also the Citi Double Cash, which gives you potentially even more on your spending — 1 percent back on purchases and then an additional 1 percent back when you pay them off.

So, if you haven’t jumped on this trend, consider getting this type of card for any spending that doesn’t fit a category.

Cards to re-think

We won’t tell you to cancel these cards, but we’d recommend making sure they’re still a good fit, due to recent changes.

1.Barclaycard Arrival+
This card was one-of-a-kind when it hit the market a few years back. But some of the stand-out benefits have been chipped away.

In late-2015, the redemption bonus got lowered from 10 percent to 5 percent, and the redemption minimum got ratcheted up to 10,000 miles.

If this card is still in your wallet costing you $89 a year, you should know that other cards provide comparable benefits for less. The aforementioned Citi Double cash gets you 1 percent + 1 percent on everything (assuming you pay on time), and the Capital One Venture card gets you 2 miles per dollar (granted, with no redemption bonus) at $59 a year. With the Barclaycard Arrival Plus’s 5 percent redemption bonus, you may still come out ahead if you consistently redeem for large amounts of miles. But the Venture has no redemption minimum and may be a good fit if you like to redeem small amounts of miles here and there (perhaps because you’re a low spender).

2. Blue Cash Preferred
This card could more easily be referred to as a slam dunk for big grocery-and-gas spenders back when its fee was $75. That fee got increased to $95 in mid-2016. When exactly the fee goes up for you depends on your renewal date.

We’re not saying you should cancel the Blue Cash Preferred – your spending in the card’s 6 percent category (U.S. supermarkets) could still earn you enough rewards to cancel out the annual fee. But, if you haven’t done the math since you first got the card, do it again and make sure you can justify paying $95 (instead of $75) a year. Also, if you got the card years ago when gas prices were higher, take into account your lower return on fuel spending.

If the $95 annual fee is just too much, consider the no-annual-fee version of this card, the Blue Cash Everyday.

3. Your rotating-category cards

While you 5 percent rotating-category-card options have thinned, there are still two major players – the Chase Freedom and the Discover it.

There’s probably no harm in keeping either, as they have no annual fee. But if you’re trying to streamline your wallet, consider putting these cards on the chopping block AFTER you evaluate your use to you. Are you regularly utilizing their 5 percent quarterly categories? Are you consistently remembering to enroll in said categories? Are you satisfied (or disappointed) when the card unveils the next quarter’s bonus categories?

If your 5 percent rotating-category card is gathering dust, consider replacing it with a catch-all card that offers more than 1 percent cash-back on everything.

4. Your out-grown, sub-par, subprime credit-building card
If you spent 2016 building up your credit, it may be time to replace any annual-fee credit-building (or secured) cards you still have, especially if they’re charging you an annual fee for the privilege of having a $300 credit limit. Accounts closed in good standing remain on your credit report for 10 years, so do not be concerned about cancelling it. Just make sure you have another (better) card in hand before you do.

Not sure what you qualify for? If you’re just emerging from bad credit into fair credit, start with one of these cards.

If you’re not sure whether your credit is considered fair, good or excellent, use a soft-pull pre-qualification tool to see which cards to shoot for.

The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

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