Advice on which credit cards/banks to go with? (funds, pay, rate)

[PhoenixBabe90]

Hi everyone, I'm wondering if you had any personal finance tips for starters?



I admit I was a bit late out the gate, having lived at home until my late 20s and my parents literally taking care of all my finances (like taking care of my tax filings/returns, opening bank accounts, etc).


But I've since moved to a different state and wondering if there are some solid common-sense advice you have for someone kind of starting out anew?



For instance, we've banked with Bank of America for as long as I can remember (my whole family). So I have a Travel Rewards card with them. Does it make sense to stick with just one bank or should I look into getting some other cards/banks? I have friends who bank with like 3 or 4 different banks all for different purposes, so I feel kind of weird that I don't.


I'm looking at getting a Chase Sapphire card for the rewards and perks, for example. I'm about to make some big furniture purchases, plus a car in the next few months, and would like to maximize the benefits for when I make these big purchase. I've also gotten a pay raise recently and considering buying a house within the next 3 years.


I've been with BofA for over a decade...does that loyalty matter or pay off in some way? Or is it smarter to search around for better options?



Thanks so much. I know this is a lot, I'm just looking for some tips here and there.

[beachmouse]

If someone handed you $1000 in crisp new paper currency, what would you do with it?

There are cards for pretty much any answer you give from 'go on vacation' to 'get a bunch of stuff on an Amazon wish list' to 'invest in mutual funds' and the best card wallet is the one that syncs with your answer to that question.

There are some reasonably decent web sites that can help you match your needs to good cards like Nerd Wallet or The Points Guy. HOWEVER, you need to be aware that each credit card can have half a dozen public offers for sign up bonuses in the wild at any time and that the card-matching web sites will steer you to the one that makes them the biggest commission on the sign up, which may or may not be the best offer out there right now.

The Bank of America card is probably not bad (and it's good to already have an established credit card history if you're thinking Chase Sapphire products) but Chase, American Express, and to some extend Citi and Capitol One typically have better rewards or co-branded cards.

I'm at foure credit cards right and and it seems right for our household- AmEx Delta Skymiles Platinum (we do travel a lot and are happiest flying Delta out my local Podunk Field), AmEx Everyday because it's a no annual fee card that generates high value Member Rewards points and gives 2x on groceries, an old AmEx Blue that dates from 2007 and I kind of keep for credit history purposes (I really should close that one and open up the AmEx no annual fee Hilton card in its place because I'd get more value out of it) and a Citi Thank You Preferred card for those times when I can't pay with AmEx.

I don't think it's excessive though I'll sometimes have to remind the Spousal Unit to pay with a specific card if there's a bonus offer attached to it.

[TXRunner]

If I was giving advice to someone new to managing their own finances, I think the last thing that would come to mind would be what kind of credit cards to use.

I would probably make sure your retirement and emergency savings are fully funded first. Next, I would want to make sure that you aren't planning on taking out loans unless they are 0% interest. There's a difference between purchasing something and taking out a loan for something, even though most people use them interchangeably.

A lot of mortgage loan officers continue to promote less than 20% down on a home loan, but I still think 20% or more is the best way to go.

I don't see any good interest rates for savings accounts at BOA. You might continue to use BOA for a checking account, just to pay monthly expenses, but I would use an online back for your savings account, so you at least get a reasonable rate (around 1.60-2.05%). If you are keeping $5000-$10,000 for emergency funds for an extended period of time, at least get a decent rate. When you link your bank accounts, which is easy to do online, you can exchange funds between the accounts fairly quickly.

What type of credit card to use is almost like asking what type of restaurant to eat at in regards to the big scheme of things. I guess it is related to personal finances, but doesn't touch upon personal finance tips for starters.

[WannabeCPA]

Your best choice for credit cards depends on how much you spend and your lifestyle. I've never had a travel card so I can't comment on how those compare to regular cash back cards but if you like to travel I suppose those would be good. Just have to watch out for the annual fees. If you can estimate how much you'll spend on your card per year you can compare cards based on their fees (if any) and their cash back. Ex. if you spend $15K a year on your CC, a $90 annual fee with 2% cash back would be better than a CC with no annual fee with only 1% cash back. Living in a 2 person household myself, my spending isn't enough to justify a CC with an annual fee. I have 3 CCs I use regularly. A Citi card with 2% cash back on everything, a Chase with 5% cash back on rotating categories every quarter (ex. groceries, gas,) 1% on everything else, and a Citi card from Costco with 4% gas, 3% restaurants, 2% travel 1% everything else. I only use one bank but I see no advantage of being loyal to one bank if another bank is better for you. I'd stick with one or two though to keep it simple. Try to find one that doesn't charge fees. I only keep a checking account with a few thousand dollars. Everything else is invested, mostly in stock index funds.

For your Chase Sapphire, try to calculate if it would be worth it with the annual fee compared to just a regular cash back card with no fee. You can probably only charge a few thousand $ for the car purchase so it's not like you'd put the whole thing on the card. Don't worry too much about which card you chose right now as you can always find better ones later when you figure out your spending habits. Just make sure to pay off the balance in full every month so you aren't charged interest.

Save up for your down payment on your house. How much you want to put down is a personal choice but I'd put at least 20% down. Don't buy a bigger house than you need for now or the foreseeable future.

Also since you're relatively young start saving for retirement now. If your employer offers 401 (k) sign up for that and contribute at least as much as the company match (if any). You can also start an IRA. Most of your long term investments (plan to hold more than 10 years) should be in stocks, not cash or bonds. The biggest piece of advice is to educate yourself about investments and finances. There's a ton of websites you can learn from. Vanguard is a good website to learn about investments. It's not that hard to understand but it does take time.

Edit: I just posted when I saw TXRunner's post above. He's right about credit cards. That should really be way down on your list of things to worry about. Keep it simple for now. I'd chose one with no annual fee and the highest cash back you can get. You can try to calculate which ones would be best, but in the grand scheme of your finances it's not a big deal. Just pay it off in full every month. I feel like I just wasted 10 minutes writing what I did about credit cards

[rjm1cc]

If you need a physical bank look for a close credit union or a local or small bank. Consider the costs of the checking account.


If you can use your smart phone to deposit checks and go to an ATM to get cash consider an online brokerage account that includes a bill pay service and free ATM's. Charles Schwab is one such firm. See what they offer and if you like it look around at the other firms.

[mathjak107]

we use chase . we also have the chase sapphire reserve card and the other 2 cards from chase the unlimited and the freedom . we shift points around .

[mathjak107]

Originally Posted by rjm1cc

If you need a physical bank look for a close credit union or a local or small bank. Consider the costs of the checking account.


If you can use your smart phone to deposit checks and go to an ATM to get cash consider an online brokerage account that includes a bill pay service and free ATM's. Charles Schwab is one such firm. See what they offer and if you like it look around at the other firms.

here in nyc we learned about counting on atm's ... 9-11 knocked many out and sandy did it's number on them ...

a local bank came in very handy when fidelity found my wife's account numbers and password for sale on the dark web ... it took 10 days to re-establish all new accounts , checks and links ..

so relying on something not local 100% is not a good idea