Advice on 2nd card

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mjl5007
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Advice on 2nd card

Postby mjl5007 » Wed Jul 08, 2015 11:20 am

I'm looking for some advice on how to "step up my game", so to speak -- specifically, how to take advantage of my already excellent credit to get better rewards.

In my late 20s and have 3 cards:
  • Discover Open Road (opened 9/2006, $5500 CL)
  • Kohl's (opened 10/2008, $1000 CL)
  • Old Navy (opened 1/2014, $2700 CL)
The Kohl's and Old Navy were my wife's idea -- I am just AU on both of them. They don't get used often, and are PIF every month when they do get used. The Discover is used almost exclusively for gas, although we do use it occasionally for larger purchases when we can earn cash back for online purchases through their portal. It is also PIF every month.

According to Discover, my FICO is 796. It was 805 last month, nothing changed other than reported balances that I'm aware of. Utilization is almost always under 10% (currently 4%).

I'm realizing that with credit this good, I could be getting so much more in terms of rewards than the measly $3-4/mo cash back I'm getting with the Discover on gas. We have always believed in not using credit cards except minimally to build credit, so we use our debit cards for everything. We know we are responsible spenders so are now considering making more of our purchases on credit to get the rewards, obviously still PIF every month.

I started looking at getting a better card than the Open Road; I think I want a cash back card not a travel card, because we don't travel often (usually once a year, always domestically). Chase Freedom and Citi Double Cash were the two majors options I was considering; Freedom has the $100 signup bonus right now while Citi has nothing, and it seems that opinions on Citi's service are mixed. But, Freedom has rotating categories and we don't really like the idea of having to track categories, we're looking for more of an "every day" card -- gas, groceries, etc.

It occurs to me that perhaps I could/should convert the Open Road to a Discover it to get a "bonus categories" card, and then get a Citi Double Cash to use for everyday purchases that don't fit the current categories?

Any advice one way or the other, or other ideas, is appreciated!


morgacj2004
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Re: Advice on 2nd card

Postby morgacj2004 » Wed Jul 08, 2015 5:10 pm

You have excellent scores so I would go for the CSP or the CO Venture. Their is debate as to which of these cards is better. CO will most likely give you an ICL of 20-30k as they are being extremely generous right now. CSP is an established card with great reviews.

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CarefulBuilder14
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Re: Advice on 2nd card

Postby CarefulBuilder14 » Wed Jul 08, 2015 5:47 pm

morgacj2004 wrote:You have excellent scores so I would go for the CSP or the CO Venture. Their is debate as to which of these cards is better. CO will most likely give you an ICL of 20-30k as they are being extremely generous right now. CSP is an established card with great reviews.

OP doesn't travel much, so CSP's UR point transfers are likely to be a hassle (despite it being a great card for travelers). Venture has a big bonus, but the ongoing rewards don't merit the AF and the customer service is generally considered lousy.

mjl, can you give us a breakdown of your spending? How much do you spend at warehouse clubs, normal grocery stores, gas, restaurants, other bills you can put on a credit card, etc.?
Love: IHG, Platinum, Sallie Mae, AA Plat, CSP
Like: Discover, ED, BCE, Hyatt, Arrival, Freedom
Might drop: BrooksBros, Prestige (Costco PC?)
Might add: Proper business card, CSR, Ritz, Delta Gold
Letting new accounts cool off since May
Really not sure what I'll add next or when

morgacj2004
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Re: Advice on 2nd card

Postby morgacj2004 » Wed Jul 08, 2015 6:01 pm

CarefulBuilder14 wrote:
morgacj2004 wrote:You have excellent scores so I would go for the CSP or the CO Venture. Their is debate as to which of these cards is better. CO will most likely give you an ICL of 20-30k as they are being extremely generous right now. CSP is an established card with great reviews.

OP doesn't travel much, so CSP's UR point transfers are likely to be a hassle (despite it being a great card for travelers). Venture has a big bonus, but the ongoing rewards don't merit the AF and the customer service is generally considered lousy.

mjl, can you give us a breakdown of your spending? How much do you spend at warehouse clubs, normal grocery stores, gas, restaurants, other bills you can put on a credit card, etc.?



I would however remind you that the CO AF is waived for the first year and as a CO holder of 3 cards have never had issues with CO CSR. I have also had only good experiences with CO EO. It would help OP overall profile to have a high limit card irregardless of whether or not he uses it.

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CarefulBuilder14
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Re: Advice on 2nd card

Postby CarefulBuilder14 » Wed Jul 08, 2015 6:19 pm

morgacj2004 wrote:I would however remind you that the CO AF is waived for the first year and as a CO holder of 3 cards have never had issues with CO CSR. I have also had only good experiences with CO EO. It would help OP overall profile to have a high limit card irregardless of whether or not he uses it.

You may not have had a bad experience, but I've gone through the CFPB statistics. Capital One gets a lot of complaints for the amount of transaction volume they have.* That's why I've never had one, and wouldn't want one as a long-term everyday card.

I would possibly consider getting one just for the bonus, but I already have a complicated card arrangement, and it sounds like the OP wants a fairly simple solution. Yes, the first-year fee is waived, but I'm assuming the OP wants to keep new cards open long-term, and not close cards after one year to avoid annual fees.

Why did you have to contact the executive office? I've never had to contact one - that's within my definition of good service!

*The good ones were USAA, Amex, Discover, Chase, US Bank, Bank of Hawaii, and (surprisingly for me) Bank of America.

**And, to be fair, Barclaycard has bad stats and I have two cards from them. They are not cards I use much, though. Neither has an AF, and I could easily do without them.
Love: IHG, Platinum, Sallie Mae, AA Plat, CSP
Like: Discover, ED, BCE, Hyatt, Arrival, Freedom
Might drop: BrooksBros, Prestige (Costco PC?)
Might add: Proper business card, CSR, Ritz, Delta Gold
Letting new accounts cool off since May
Really not sure what I'll add next or when

morgacj2004
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Re: Advice on 2nd card

Postby morgacj2004 » Wed Jul 08, 2015 7:04 pm

CarefulBuilder14 wrote:
morgacj2004 wrote:I would however remind you that the CO AF is waived for the first year and as a CO holder of 3 cards have never had issues with CO CSR. I have also had only good experiences with CO EO. It would help OP overall profile to have a high limit card irregardless of whether or not he uses it.

You may not have had a bad experience, but I've gone through the CFPB statistics. Capital One gets a lot of complaints for the amount of transaction volume they have.* That's why I've never had one, and wouldn't want one as a long-term everyday card.

I would possibly consider getting one just for the bonus, but I already have a complicated card arrangement, and it sounds like the OP wants a fairly simple solution. Yes, the first-year fee is waived, but I'm assuming the OP wants to keep new cards open long-term, and not close cards after one year to avoid annual fees.

Why did you have to contact the executive office? I've never had to contact one - that's within my definition of good service!

*The good ones were USAA, Amex, Discover, Chase, US Bank, Bank of Hawaii, and (surprisingly for me) Bank of America.

**And, to be fair, Barclaycard has bad stats and I have two cards from them. They are not cards I use much, though. Neither has an AF, and I could easily do without them.



I contacted EO regarding an issue with a CLI. I was immed given a 2k increase. I had nothing but problems with AX and I eventually closed both my Gold and Platinum cards. Doubt I will ever get an AX card again. I like Barclays CO, BofA and DS. OP can use the initial 40 k miles and then subsequent miles toward his annual air fare. That should nearly be enough for 2 RT domestic tickets anywhere in the US. That is worth more in my mind than any rewards dollars that he is going to get unless he really has Big Spend.

mjl5007
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Re: Advice on 2nd card

Postby mjl5007 » Thu Jul 09, 2015 9:29 am

While I very much appreciate the advice and recommendation, morgac, I'm not really interested in a travel/miles card just yet. As you can tell I'm fairly new to the idea of actually using a credit card on a regular basis, and I want to keep things simple for now -- I don't want to be worrying about whether or not I'm getting the most value out of my points/miles by redeeming them in the correct way. I know I said we travel once a year, but that's only over the past 3-4 years -- not exactly a long term trend, and with two kids under 3 and another planned in a few years I don't want to assume that we'll be traveling on a regular enough basis to be able to get better value from a travel card, yet.

Also, to clarify/confirm, I am not interested in churning, canceling cards after a year to avoid AF, etc. I just realize that with my excellent scores I could easily be getting better rewards than I am currently and want to take advantage of that, without going "credit card crazy" -- no offense intended. We don't intend to be shopping for a mortgage or other loan any time soon, so I'm not so much worried about improving my profile/scores -- they're good enough already.

As for spending breakdown, I would say we are almost certainly not what you would call "big spenders". Probably $400-450/mo groceries (guessing 60/40 or 70/30 supermarkets vs. Walmart/Sam's Club), $100-$150/mo gas, $100-$125/mo restaurants, maybe $150-200 in other monthly bills that can go on a card. I also do some home improvement, light woodworking, etc, maybe $100-$150/mo there. We do have a 5mo old, so we're in diapers for at least another 18 mos as well. We also do a decent amount of shopping on Amazon for various things, maybe $100-150/mo.

I was looking at AmEx BCE or BCP yesterday, and thinking it might be a great fit, especially the BCP with 6% on groceries and 3% on gas. At $400+/mo in groceries alone we would easily do better with the BCP than BCE even with the AF, and 3% gas/1% on everything else is better than the 2% gas/0.25% everything else we're getting with OpenRoad now. I could also presumably buy Amazon and other GCs at the supermarket to get 6% there, too, correct? The $150 sign up bonus is also a big incentive. As far as non-category cards go, it seems like it would be a much better fit for us than Citi Double Cash, especially since Citi currently has no sign up bonus. Just need to make sure AmEx is accepted at all our local grocery and gas stations.

The more I think about it, I'm leaning away from a rotating categories card like Freedom, at least as an "every day" card. However, I like the idea of having a secondary card with categories that I can use when I happen to have a purchase that fits the categories, which is why I thought converting my Open Road to an "it" might not be a bad idea. Would doing such a conversion involve a credit pull? Could I convert Open Road to "it" and get another "every day" card (BCP or other) around the same time, or would I need to space them out? Which should I do first?

Thanks for your insight!

morgacj2004
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Re: Advice on 2nd card

Postby morgacj2004 » Thu Jul 09, 2015 1:23 pm

mjl5007 wrote:While I very much appreciate the advice and recommendation, morgac, I'm not really interested in a travel/miles card just yet. As you can tell I'm fairly new to the idea of actually using a credit card on a regular basis, and I want to keep things simple for now -- I don't want to be worrying about whether or not I'm getting the most value out of my points/miles by redeeming them in the correct way. I know I said we travel once a year, but that's only over the past 3-4 years -- not exactly a long term trend, and with two kids under 3 and another planned in a few years I don't want to assume that we'll be traveling on a regular enough basis to be able to get better value from a travel card, yet.

Also, to clarify/confirm, I am not interested in churning, canceling cards after a year to avoid AF, etc. I just realize that with my excellent scores I could easily be getting better rewards than I am currently and want to take advantage of that, without going "credit card crazy" -- no offense intended. We don't intend to be shopping for a mortgage or other loan any time soon, so I'm not so much worried about improving my profile/scores -- they're good enough already.

As for spending breakdown, I would say we are almost certainly not what you would call "big spenders". Probably $400-450/mo groceries (guessing 60/40 or 70/30 supermarkets vs. Walmart/Sam's Club), $100-$150/mo gas, $100-$125/mo restaurants, maybe $150-200 in other monthly bills that can go on a card. I also do some home improvement, light woodworking, etc, maybe $100-$150/mo there. We do have a 5mo old, so we're in diapers for at least another 18 mos as well. We also do a decent amount of shopping on Amazon for various things, maybe $100-150/mo.

I was looking at AmEx BCE or BCP yesterday, and thinking it might be a great fit, especially the BCP with 6% on groceries and 3% on gas. At $400+/mo in groceries alone we would easily do better with the BCP than BCE even with the AF, and 3% gas/1% on everything else is better than the 2% gas/0.25% everything else we're getting with OpenRoad now. I could also presumably buy Amazon and other GCs at the supermarket to get 6% there, too, correct? The $150 sign up bonus is also a big incentive. As far as non-category cards go, it seems like it would be a much better fit for us than Citi Double Cash, especially since Citi currently has no sign up bonus. Just need to make sure AmEx is accepted at all our local grocery and gas stations.

The more I think about it, I'm leaning away from a rotating categories card like Freedom, at least as an "every day" card. However, I like the idea of having a secondary card with categories that I can use when I happen to have a purchase that fits the categories, which is why I thought converting my Open Road to an "it" might not be a bad idea. Would doing such a conversion involve a credit pull? Could I convert Open Road to "it" and get another "every day" card (BCP or other) around the same time, or would I need to space them out? Which should I do first?

Thanks for your insight!



I don't like AX as I prev had several bad experiences with them. ( I prev had 3 AX cards for many yrs including a Platinum ) but that is my personal preference and a lot of people on this forum swear by AX. I would go for the Citi Double Cash maybe wait awhile to see if they offer any promotions. I have a DC IT and like the card esp now that they are offering the 5% back on select charges. A lot of people esp those with thin Credit Hx like the Freedom card. I have limited experience with CHASE so maybe someone else can chime in. Just my thoughts.

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Re: Advice on 2nd card

Postby Vattené » Thu Jul 09, 2015 4:59 pm

I would recommend a two-pronged approach given your current situation:
  • Get a cash back card for every day use. Cash back is simple and you know your return rate. The BCP or BCE are both great options. The BCP will be a workhorse for you, and as you mention net you more than the BCE given your spending estimates. Even using your most conservative figures of $400 a month on groceries with 60% at supermarkets puts you at $240/month in a bonus category. That's $86.40 per year on BCE compared to $97.80 on BCP net of the annual fee. Alternatively, if you are worried about acceptance*, consider the BofA Cash Rewards card for 3%, 2%, and 1% on gas, grocery, and everything else, respectively with no annual fee. Since you spend significantly more on groceries than gas, though, even the BCE would be a better fit strictly from a rewards perspective.

  • Keep your Discover account but product change to the it card. Speak with a CSR to be sure, but it shouldn't have any impact on your credit: no hard inquiry since you are keeping the account and history, just changing the rewards structure. It isn't as straightforward as the BCP's constant categories, but you already have an account so you might as well switch it to something that will earn you more. You can use it exclusively for the 5% rotating categories if you wish. Not sure if it is the same with Open Road, but the it lets you redeem for any amount of cash back, so you can put minimal spending on it and not worry about waiting to reach a redemption threshold. Plus, signing up for bonus categories honestly is not that much of a hassle. They only change every three months and you can set reminders so you don't miss it.

*Many cite acceptance as a reservation for getting Amex or Discover, but I don't think this should be too much of a concern (unless perhaps you spend a lot at smaller/non-chain/mom-and-pop merchants). In my experience it hasn't been a problem at all, and I use Amex and Discover as my main cards. Most places that take MC/Visa will at least take either Discover or Amex. You may have to use debit once in a long while but if rewards are a big priority, they will greatly outweigh the inconvenience.
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FICO-8:
EX - 809 (11/16) | TU - 803 (11/16)
Primary Cards:
American Express EveryDay - $20,000 (10/14)
Discover it - $23,000 (2/14)
AU on Barclay Sallie Mae - $10,000 (8/15)
plus several store accounts of varying usefulness now

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Re: Advice on 2nd card

Postby mjl5007 » Fri Jul 10, 2015 1:56 pm

Vattené wrote:I would recommend a two-pronged approach given your current situation:
  • Get a cash back card for every day use. Cash back is simple and you know your return rate. The BCP or BCE are both great options. The BCP will be a workhorse for you, and as you mention net you more than the BCE given your spending estimates. Even using your most conservative figures of $400 a month on groceries with 60% at supermarkets puts you at $240/month in a bonus category. That's $86.40 per year on BCE compared to $97.80 on BCP net of the annual fee. Alternatively, if you are worried about acceptance*, consider the BofA Cash Rewards card for 3%, 2%, and 1% on gas, grocery, and everything else, respectively with no annual fee. Since you spend significantly more on groceries than gas, though, even the BCE would be a better fit strictly from a rewards perspective.
  • Keep your Discover account but product change to the it card. Speak with a CSR to be sure, but it shouldn't have any impact on your credit: no hard inquiry since you are keeping the account and history, just changing the rewards structure. It isn't as straightforward as the BCP's constant categories, but you already have an account so you might as well switch it to something that will earn you more. You can use it exclusively for the 5% rotating categories if you wish. Not sure if it is the same with Open Road, but the it lets you redeem for any amount of cash back, so you can put minimal spending on it and not worry about waiting to reach a redemption threshold. Plus, signing up for bonus categories honestly is not that much of a hassle. They only change every three months and you can set reminders so you don't miss it.

*Many cite acceptance as a reservation for getting Amex or Discover, but I don't think this should be too much of a concern (unless perhaps you spend a lot at smaller/non-chain/mom-and-pop merchants). In my experience it hasn't been a problem at all, and I use Amex and Discover as my main cards. Most places that take MC/Visa will at least take either Discover or Amex. You may have to use debit once in a long while but if rewards are a big priority, they will greatly outweigh the inconvenience.


You know, I had all but come to the same conclusion on my own, so I'm glad to have someone else give me the same advice. I think the BCP is going to be the way to go -- just need to convince my wife that it's OK to pay an AF for a credit card because in the end we come out further ahead than e.g. BCE without the AF.

I also definitely like the idea of PC the Discover to IT. I like the idea of having a secondary card with 5% categories to use when my purchasing fits the categories (because hey, I'll take 5% over 1% on something I'm going to buy regardless any day of the week), and since Discover IT and Freedom seem so similar and we're going to keep the Discover account regardless since it's our oldest card and accounts for nearly 60% of our current CL, it makes sense to just change it to an IT and be done, rather than having to get approved for both BCP and Freedom. And as for signing up for the bonus categories every quarter, that doesn't bother me at all. What I don't want is to be constantly trying to fit my spending to the categories to maximize my rewards; I want to buy things when I need to and not worry about whether I should wait until next quarter to get the better reward, or think ahead and buy things now that I don't/won't need until later in the year because they fit into the current categories. I guess the short version of that is I don't want my credit cards to dictate my spending; I want them to work for me.

Re: acceptance, I'm not really concerned. We've never once wanted to use our Discover for a larger purchase and found that it wasn't accepted, and I'm fairly certain all of the grocery stores that we shop at (Wegman's, Giant, Weis, Trader Joe's) accept Amex. I know that the local gas chain takes AmEx as well. Besides, we'll still have our Visa debit cards just in case.

Maybe in the future I'll also pick up a Citi Double Cash to round it all out. BCP for 6% groceries and 3% gas, Citi DC for 2% everything else (and perhaps groceries if we happen to hit the $6k cap on the BCP), and Discover IT for the 5% bonus categories. We'll see.

I'm still not sure whether I should apply for the BCP first, or PC the Discover to IT first. Does it make a difference? If I should do one before the other, do I need to wait between the two?



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