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Video Sunday Reader Question: How to Maximize Credit Card Rewards for College Graduates

by on July 15, 2012 · 1 comment

in Avios, British Airways, Chase, Credit Cards, Sunday Reader Questions, Video Blog Post

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TPG reader Coleman writes a two part question:

“Do credit card companies normally approve grads without much credit history? I opened a credit card a year ago and have paid the balance in full each month, as well as utility bills/rent/etc. on time as well too. But I just haven’t been doing it for very long, and I’m pretty young, so I didn’t know if I should even apply.”

Yes – credit card companies absolutely approve students or those who have recently graduated – even if you don’t have high income or a long credit history. It all depends on your credit score, which you should know if you want to start applying for more cards. You can get a free report here and if you want to know your FICO score, which is the one used by most credit card issuers to determine your creditworthiness, you can pay $19.95 directly from Fico here.

Read more about the different factors that go into your credit score here – it’s critical you maintain a high score if you want to maximize the amount of miles and points earned from credit cards.

What’s the magic score to get approved? It all depends on the issuer and type of card you are applying for, but generally you should have at least a 700 on the FICO score, though that’s not mandatory. Many people have talked their way into approvals through reconsideration phone lines by explaining past mistakes on their credit report. If you have a round of credit card applications coming up, pay off all of your bills before your statement closes so all of your accounts report as fully paid off and you have the absolute highest ratio of available credit to debt.

 

“If I do happen to get it (I’m looking at the Chase British Airways Visa and the Chase Sapphire Preferred for the great point bonuses), then do you have any suggestions on using them to get cheap awards? I saw the post on British Airways and saw the crazy fees they charge for international flights, but I didn’t get whether or not you could use a different airline carrier other than British Airways? Our first stop is planned to be London, and you said British Airways services London well, but with their fees, I didn’t know if there was a better option.”

Using Avios to fly to London is generally expensive (think $600+ in fees per ticket). You can fly Aer Lingus to Dublin or transfer your British Airways Avios to Iberia Avios to bring down the fees on those partner flights. Another option is to book Premium Economy seats (World Traveller Plus) using your card and since you get 10% off (including taxes and fees) by using CARDOFFERU and paying with your BA Visa and then you can use 10,000-12,500 Avios each way to upgrade to business class.

For the cheapest awards to Europe, you’ll probably want to build up your Sapphire Preferred Ultimate Rewards points because they can be transferred to United and for 60,000 points you can get roundtrips to Europe (and include a stopover) and the fees are minimal.

Maximizing British Airways Series
Master FAQ Post on British Airways 100,000 Mile OfferSpotlight on Taxes and FeesDistance-Based AwardsHousehold AccountsUsing Avios to Upgrade Paid TicketsThe Avios and Cash OptionSave Money on Fuel Surcharges by Transferring British Airways Avios to IberiaUsing Avios For Non-Flight Redemptions

Disclaimer: 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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  • PJ

    a tip from one ex Chase private banker: go to a Chase Branch and try to check out a small loan to be collaterized by a Savings account or Checking account you open with Chase. The loan will carry a few % interest rate . However if you pay your installment payment monthly all on time say 6 months you are building up your credit score substantially. 4 % on 1000 costs you $40 a year but the anticipated payback on higher credit score is quite worthwhile. My apology in advance if this one DOES NOT work any more.

    Also Discover seems to be quite willing to give college graduate the regular card with 5 % rebate on rotating categories. that is another way to charge up your credit score.

    To see the credit score Chase and Bank of AMerican look at: http://www.creditsesame.com spits out identical Experian score when you apply their card.. it is free and it pays to know how you stand creditworth wise.. in THEIR eyes

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