A Mountain of Credit Card Offers. Which And How Many Credit Cards Should You have?

November 17, 2017

I opened my inbox today to find myself with 5 credit card offers today. 5. Not sure if it is a record but it is up there.

I guess my recycling bin is going to be overflowing this week!


Now you may wonder: Don't I use credit cards to help fund my travel? Why would I be turning down the opportunity to get more cards?


And this is where people find one of the more restrictive nuances of credit card travel people don't learn about until it is too late:


Credit card inquiries and application restrictions. You need to be selective on how you acquire new cards!




Now not every card issuer have the same standards. Some cards are targeted towards entry level users establishing their credit, while other cards are business cards with massive 6 figure credit lines. Most of the major card issuers such as Chase, American Express, and Citi, all have some their own set of rules limiting what cards a person can qualify for.


Beyond just having a good credit score and payment record, as well as an income that justifies a credit card limit, card issuers also have their own gauge in how aggressively a consumer is seeking out credits.


Every time you apply for some form of credit, whether it is a credit card, a bank or auto loan, or even things such as increasing credit limits of an existing card, financial institutions will request for a hard pull on your credit. Not only do these pulls temporarily lower your score, it also is a mark indicating how credit hungry you are during the record keeping period of 2 years that these hard inquiries stay on your report.

Different issuers have different guidelines as to how much is too much when it comes to hard inquiries. And sometimes these guidelines are simply just that: guidelines. Sometimes their credit administrators may overrule what guidelines may dictate.


However, as part of your travel and credit card strategy, you should be very careful on which credit card you are adding to your portfolio to maximize on how you can extract value from your spending in an efficient manner. You will want to prioritize acquiring the cards with the highest value of signup bonuses first, and then cards that followed by cards most suitable to your own spending pattern.


Think about it. Some cards offer you 80,000, 100,000, sometimes even 150,000 points upon meeting prerequisite spending.  These may even be flexible points like Chase Ultimate Rewards or AmEx Membership Reward points that can be transferred to a lot of different airlines and hotels. Are you likely going to generate that number of points from a bonus spending category off a specialized card? Even earning 5% on a category you will likely be spending $20,000 to generate that number of points, it would be far easier to get signup bonuses where it only requires $2,500 or $5,000 of spending in ANY category.


Also, some cards only allow you to receive one signup bonus in your lifetime per product. Do you really want to take up a subpar offer when there may be promos down the road?


So in order to help you analyze what cards should you apply for, here is a quick guide and some of the restrictions from the major issuers that I analyze when I decide if I should be applying for a card:



- Has the dreaded 5/24 rule. Most of their personal cards that is offered by Chase will automatically reject your application if you had more than 5 credit inquiries in the last 24 months. This is the count on -ALL- banks and not just cards issued by Chase. Probably one of the most limiting rule if you are expecting to earn most of your points by signup bonuses.


Chase is known to be fairly firm with this though there are exceptions and some partial success calling into their reconsideration line, but this is probably one of the most limiting rule as Chase often times offer outsized signup bonuses such as 80,000 points on a $95/year Ink Business Preferred, or 120,000 Marriott points with the $85/year Marriott Rewards Premier card (personal)


- It seems like Chase cares more about your total amount of credit line that you have, versus the number of cards that you actually have. One trick is if you do get denied is to offer to shift credit from another card you already have to see if you can tip them over to approve a new card without expanding too much your total overall credit profile.


- Business cards generally do NOT count towards 5/24, with the exception of cards issued by Capital One and Discover, so if you have the option to apply for a business card, you may want to look into doing more of those if you plan to be aggressively applying for Chase cards.


- There are also co-branded cards that seems to be outside of the 5/24 rule. They do add to your total 5/24 count, but it will not restrict you from being approved for these cards. 


AARP, Hyatt, British Airways Visa Signature, IHG Rewards Club Select, Disney, Ritz Carlton Rewards Visa Infinite, and Marriott Rewards Premier Business, are the exception to this rule. I suppose most likely due to the corporate partnerships they had to relax the rule a bit for people to take advantage of their co-branded arrangements.


- You can receive a signup bonus again if you currently do not have the card, and have not received a signup bonus for longer than 24 months. Chase seems to be more generous on signup bonuses than AmEx, but personally I enjoy AmEx's earning structure way more, and they have a massive value partner in SPG that if you have steady regular spend, AmEx may make up for their once in a lifetime signup bonus limitations.



- While many people have the idea that AmEx is an exclusive card for highly qualified individuals, my personal experience with AmEx is that they are really no harder to get than your mid-tier Chase cards. As long as you have a respectable credit score in the upper 600's, you should be able to get an AmEx. That said, they do limit the number of cards you can have to 4 credit cards at a time, business + personal cards combined. Charge cards, such as the Platinum Card or Gold Card where you have to pay off the balance in full each month do not count towards this 4 card limit.


- AmEx is bit more lax when it comes to frequency of acquiring credit. You can get approved for 2 cards every 90 days on a rolling basis. They also don't seem to have any restrictions on how many inquiries you have on your credit report.


- What AmEx is strict about is the number of signup bonuses you will receive. You can only receive 1 bonus in your lifetime for that specific product, and the definition of that is that you cannot reapply for the exact same card twice. So a personal Platinum is NOT the same product as a business Platinum. Or a Blue Cash Preferred is not the same as a Blue Cash Everyday.



-Citi seems to be a mix of both AmEx's and Chase's strategies. They sometimes offer rather attractive signup bonuses, but they are also somewhat tight with approving new cards. Citi seems to have a tendency to decline people with more than 6 inquiries in the past 6 months, tho there are exceptions.


- They also have a similar signup bonus language to Chase where you can earn a new bonus if you have not had any activity in a product FAMILY in the past 24 months. So any account opening or closing would reset the clock.


- They also seem to only allow 1 application, every 8 days, and 2 every 65. There are no restrictions in the number of cards you can have.



My own view is that you should target the high earning signup bonus cards, especially the Chase cards such as the Chase Sapphire Preferred and Marriott Rewards Premier Personal Visa. Do one every 2 or 3 months so you can plan your spending around the minimum spend requirements.


Only once you filled out you first 5 cards with valuable Chase cards then you should start moving into AmEx and also business cards before cooling off to buy yourself some flexibility for new cards to come or maybe a 2nd signup bonus.


You should also do your research to make sure your cards are offering you the best bonuses when you do sign up. Most issuers will have promotional periods for a specific card every couple of months, so a little Google searching may give you an idea what are the historical high signup bonuses.


And what's the most important: Pay off your debt. Don't let points fool you into careless spending. It is only with careful management of your own finances that you will be able to be rewarded. But mismanagement will lead to disaster... and with credit cards that is usually a 20%+ interest that no one should really be able to afford to pay.


Keep in mind you will have to meet minimum spend as well so if you don't spend that much money, then perhaps you should stick with 1 or 2 of the highest signup bonus cards, and stick with 1 card that works best for your own spending pattern. There's no point in maximizing your earning potential if you will have to take on unnecessary spending that could lead to bad debt habits.


What is your favorite card and biggest signup bonus offer that you have been offered? What strategy do you use to maximize value out of your cards? Let me know in the comments section below!





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