Should you be applying for credit cards right now?

Apr 3, 2020

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Coronavirus concerns and social distance measures are currently affecting our lives in many ways. Non-essential travel has come to a halt, many cities and states are asking citizens to remain at home and it’s unclear when life and travel will get back to normal. With all this occurring, you may be wondering whether you should be applying for credit cards right now.

I applied for a new travel rewards card earlier this week, so I’m personally taking the “yes” response to this question. After all, my grocery, dining and entertainment expenses while remaining at home might as well go toward reaching a minimum spending requirement on a new card. But, the decision of whether to apply for cards now depends on your current situation. Here are some other things to consider.

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In This Post

Stock up on rewards for future travel

Now is not the time for non-essential travel and I don’t know when I’ll be back on the road. But I am using this time while I’m grounded to stock up on points, miles and transferrable rewards for future travel. And, one of the best ways to quickly collect rewards is to apply for a card that’s offering a sizeable welcome bonus.

Marriott Gold status will provide benefits at properties like the Westin Langkawi. (Photo by Katie Genter/The Points Guy)
Stock up on rewards now so you can book a stay at a property like the Westin Langkawi Resort & Spa once we can travel again. (Photo by Katie Genter/The Points Guy)

You usually apply for a card and complete the minimum spending requirement to earn the welcome bonus. You may need to spend a bit more to reach the number of rewards needed for a redemption. So, if you apply now, the rewards will be ready to redeem in a few months, when the crisis is over. So, in some ways, now is the perfect time to add a new card to your wallet if you’re looking to fund a trip in the fall or winter.

Travel rewards cards to consider

The information for the Capital One VentureOne and Citi / AAdvantage Platinum Select World Elite Mastercard has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.     

Shift to cash-back rewards cards

If cash is tight, you might want to earn cash-back rewards instead of travel rewards on your necessary purchases right now. You can redeem most transferrable currencies for statement credits, but oftentimes the redemption rate is less than ideal. So, you may want to sign up for a new cash-back card that earns bonus rewards in the categories where you’re currently spending.

Cash-back rewards cards to consider

The information for the Capital One cards and Chase Freedom card has been collected independently by Million Mile Secrets. The card details on this page have not been reviewed or provided by the card issuer.

Related reading: The best cash-back credit cards

Shift to earning flexible rewards points

Honolulu, Hawaii. (Photo by Timur Alexandrov / EyeEm)
Flexible points can get you wherever you want to go, including Hawaii, with a variety of redemption options. (Photo by Timur Alexandrov/EyeEm)

If cash flow isn’t a problem and you aren’t currently excited about earning airline miles and hotel points, then you may want to switch to cards that earn transferrable rewards. Transferrable rewards like American Express Membership Rewards, Chase Ultimate Rewards, Citi ThankYou, Marriott Bonvoy and Capital One Rewards can all be used to book travel through the program’s portal or transferred to various travel partners. So, by earning transferrable rewards, you’ll protect yourself from the risk that individual loyalty programs devalue their rewards or terminate their program.

Cards to consider that earn flexible rewards

The information for the Citi Premier card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Related reading: A guide to earning transferable points and why they’re so valuable

Take advantage of 0% APR offers

If money is temporarily tight, you may want to apply for a credit card with a 0% intro APR. These cards will allow you to make purchases and carry a balance on your account for a set time without incurring interest. But you should ensure you’ll be able to pay off your balance in full by the time the 0% APR period ends, since the rate will jump to a variable APR based on your creditworthiness.

You’ve also likely heard that the Federal Reserve slashed rates to almost zero recently. If you are carrying a balance on an account that has a variable APR, you may see a slight reduction in your APR. But, this decrease will likely only have a minimal impact on your monthly payment.

0% APR cards to consider

  • Citi Simplicity® Card: Best for a 21-month 0% introductory APR period on balance transfers (All transfers must be completed in first 4 months from account opening. After that, the variable APR will be 14.74% – 24.74%, based on your creditworthiness.)
  • Blue Cash Everyday® Card from American Express: Best for U.S. supermarkets. It also offers a 0% introductory APR on purchases for the first 15 months of account opening (then a variable APR of 13.99% to 23.99% applies) (see rates & fees). Terms apply.
  • Chase Freedom: Best for rotating bonus categories, including groceries and select streaming services this quarter. This card also offers a 0% introductory APR for 15 months from account opening on purchases and balance transfers. After the intro period expires, the standard rate is a variable APR of 14.99% to 23.74%.

The information for the Citi Simplicity card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Related reading: The top no-annual-fee credit cards with a 0% intro APR

Snag current limited time offers

(Photo by Thought Catalog via Unsplash)
It’s difficult to predict how welcome bonuses will trend going forward. So, if you see a bonus on a card you want, it might be worth grabbing it. (Photo by Thought Catalog via Unsplash)

In the current climate, it’s difficult to predict how credit card issuers will react. Although we may see higher welcome offers and loosened application restrictions as card issuers attempt to attract customers, it’s also possible that we’ll see tightened restrictions and lower welcome bonuses as card issuers attempt to limit their risk and expenses.

So, if there’s currently an attractive welcome offer on a card that you want — and you’re able to meet the minimum spending requirements — then you may want to go ahead and snag the card (and welcome bonus).

Related reading: The best limited-time credit card offers to sign up for this month

Some issuers are making welcome bonuses more attainable

Like many people, my spending has dropped significantly due to staying in one place and social distancing. So, you may find it difficult to reach the minimum spending requirements to earn a welcome bonus now, even if the spending requirements would have been easy for you to reach a few months ago.

Luckily, Amex is offering a 3-month extension to cardholders to complete credit card spending requirements. Cardholders of eligible business and consumer accounts approved between Dec. 1, 2019 through May 31, 2020, will get three extra months to reach the minimum spending threshold required to earn the welcome offer. This is a great opportunity to snag some welcome bonuses that were previously out of reach due to high spending requirements.

Hopefully, we’ll see other card issuers follow suit by allowing additional time to reach minimum spending thresholds — either on cards for which you’ve already applied or on future welcome offers.

For rates and fees of the Blue Cash Everyday Card, please click here

Featured photo by Hero Images/Getty Images.

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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.