SRQ: How To Maximize Travel Credit Cards In Retirement?
Update: Some offers mentioned below are no longer available. View the current offers here.
Update: The 50,000 point sign up offer for the American Express Premier Rewards Gold card is no longer available through the Card Match Tool.
TPG reader Ron has recently retired, but wants to keep racking up points and miles with credit cards. Here's his question:
"Do you know of a strategy for retired persons to use when applying for credit cards that earn miles? I would like to add to the credit cards I have and my FICO score is high, but since retirement am reluctant to try. At first look, my financials may look weak on a credit card application. In particular, the applications usually require your job info and salary. Retirement seems like a golden opportunity to earn and spend miles. What can I do to make sure it is?"
Just because you're retired doesn't mean you can't get in on lucrative credit card offers like the current 50,000-point sign-up bonus on the American Express Premier Rewards Gold card. If you've spent your professional life until now being financially responsible and building up your credit score, now is a better time than ever to apply for the best cards out there and maximize your credit score to the fullest.
A lot of people think that their income is the most important element to help them get the most lucrative travel credit cards out there, but in fact, the single most important factor in getting a credit card is your overall credit score, and as you can see in this post, there are a lot of other factors involved including the length of your credit history, whether you pay your bills off on time, and what kinds of credit you have since certain kinds like mortgages and car loans can actually help bolster your credit.
Credit card applications do ask you what your annual income is, but if you've just retired, then you can put your most recent annual income on your application, or if you anticipate a higher income this coming year, put that. Credit card applications do not require W2 proof of income, so you can present yourself in the most positive light possible - within reason. I would never advocate lying or even stretching the truth about your income, but use what you have earned in the past or reasonably expect to earn in the future to help yourself.
Since your income is probably more fixed than in the past, other key considerations include thinking about minimum spending requirements and not biting off more than you can chew, since many of the best offers out there involve some spending in order to earn the full bonus.
Even though you might not be making as much money as you were when fully employed, if your credit is in good shape, you can maintain it by paying off your bills and being responsible about minimum spending requirements, and you have specific goals in mind, you should have no trouble applying for and getting the travel credit cards you want.
Some of the top cards I'd recommend at the moment include:
50,000 Membership Rewards points for the Premier Rewards Gold Card from American Express thanks to a special offer through the Card Match Tool on CreditCards.com.
50,000 British Airways Avios for spending $1,000 within 3 months on the British Airways Visa, and up to 50,000 more for a total of 100,000 Avios when you spend $20,000 within a year of account opening.
50,000 Ultimate Rewards points for the Chase Ink Bold for spending $5,000 in the first 3 months
40,000 Ultimate Rewards points for the Chase Sapphire Preferred for spending $3,000 in the first 3 months
50,000 American AAdvantage miles for various cards.
25,000 Membership Rewards points for the Business Platinum card from American Express OPEN Savings for spending $5,000 in 3 months.