By Eliott M. Kass | American Express Credit Intel Freelance Contributor
6 Min Read | December 20, 2019 in Cards
With a bewildering number of credit cards on offer, how do you choose which credit card is best for you? And even if you have one or more cards already, are they the right ones—or should you choose a new credit card for 2020? After all, credit card benefits can change from year to year, even though the basics of choosing a card don’t.
Here’s a look at why you might want to choose a new credit card in 2020 and how to pick the best one to meet your needs.
When choosing a new credit card, it pays to think hard and choose wisely—it’s usually a long-term commitment! Roughly 25 million Americans keep the same card for at least 10 years.1 Here are four things financial experts say you should consider.
But if you already have one or more credit cards, why should you even think about swapping them out or adding a new one to the mix?
Credit card companies change their offers all the time, and in 2020 they are expected to offer more flexible rewards and step up their efforts to woo groups like affluent millennials. Cash back, for instance, is now recognized as the reward most preferred by people of all income levels, so expect to see lots of cards that promote this incentive.4 So, if you haven’t chosen a new card in a while there’s a chance you may be missing out on some really good opportunities.
Plus, choosing a new credit card may help boost your credit score. Adding a new card’s credit limit without increasing your total spending may improve your credit utilization rate, which is the ratio of the credit you use to your total credit limit.5 That ratio is one of the factors that contributes to credit scores.
Also, if your credit score has improved since the last time you applied for a card, you may be able to qualify for a lower interest rate.
To choose the best credit card in 2020, you need to consider why you need—or want—it in the first place and what sort of items you plan to buy with it. Then you can look for the optimal mix of fees, rates, and spending rewards. Credit issuers are expected to offer even more attractive rewards, making 2020 a good time to choose a new credit card.
Show Article Sources
1 “How to Choose a Credit Card in 9 Easy Steps,” The Ascent
2 "Consumer Credit – G.19," the Federal Reserve
3 “How to Choose a Credit Card in 9 Easy Steps,” The Ascent
4 “Poll: Wealthy cardholders prefer cash-back rewards,” CreditCards.com