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Should New People Wait to Apply?
I talk to a lot of people who are new to this hobby both online and in person when I attend conferences like this past weekend’s Family Travel for Real Life. Through those interactions I have learned a few things about their behaviors.
One of the common things they tell me is how they jumped in head first. They normally then follow that up with a comment about how they may have moved a little too fast. How they should have read and studied more before applying for a bunch of credit cards.
I can’t tell you how often someone relatively new writes in with a question about an upcoming trip they are planning. When I respond to ask for their balances, the results are scary. 20k miles here, 15k points there. In other words, many thousands, but not enough in any one program to get them anywhere.
Most people jump in to this hobby without a plan. Having thousands of points and miles is nice, but they are only as valuable as your redemptions. Everyone including myself has “trapped” points in one program or another, because we jumped on a deal without thinking. It is perhaps the most common mistake.
So that brings me to the title of this post. Should there be a mandatory waiting period before applying for credit cards? Of course I am not talking about a government mandate, but more of a personal one. Perhaps the use of the word mandatory is poor. How about a voluntary waiting period?
Why You Should Wait
If you are new, there are so many factors to consider before applying for one or a dozen credit cards. You must consider which banks to apply at, which loyalty programs to target and how these applications affect your credit?
Of course there are also a ton of little things to learn like how each bank treats applications and how many cards you can get from each. How about reconsideration or the credit score needed for each product. These are all things I could generally tell you off the top of my head, but can be difficult for newer people to find.
My wife just received a 75k offer in the mail for the American Express Business Gold Rewards card. Definitely a great offer, but we recently applied for a lot of cards, so I am not quite ready to pull the trigger. What should I do?
In the past I might have jumped on it right away, but now I am able to see that waiting is the right move. The application is good through April, so now I can wait and incorporate it into a larger plan. I am always studying offers and formulating a plan going forward. Nowadays every application has some strategic importance.
The great thing about this hobby is that we are a community. Of course there are what some people refer to as the “angries”, but for the most part people are willing to help as long as you are willing to do some work as well.
Many bloggers are also willing to help. I am one of them. You can email me anytime at firstname.lastname@example.org and I will respond as quickly as possible. If it is a really intricate question it may take a day or two, but for something quick and simple I try to get back very quickly.
If you are new or newer, I highly suggest waiting before applying for a bunch of credit cards. Most of the offers available aren’t going to go away if you wait a day or two, so you won’t miss out. Instead, by waiting, you may just find that you will get much more return on your applications and avoid stranded points.
So now I turn this to you? Do you think newer people should wait until they have had time to learn and study the hobby? What are your thoughts? Let me know in the comments.
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