How To Assess Your Credit Card Portfolio

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The start of a new year often serves as an unofficial cause for change. That might mean a new gym routine, healthier eating habits, or a more focused approach to school or work.  A new calendar year is also an opportune time to assess your credit card portfolio!  When making this kind of evaluation, the ultimate goal is to maximize the value you get from your wallet. Below are some helpful questions to ask yourself throughout the process.

Do I Benefit From My Current Cards?

Assessment of your credit card portfolio begins with an analysis of the current state of your wallet. Particularly for cards that charge an annual fee, you need to determine if the perks and rewards justify holding the card over the long term. That might sound like an easy question to answer, but a quantitative evaluation might prove difficult for cards that offer qualitative benefits.

I like to think of card benefits in three distinct categories:

  1. Fixed Dollar: These are card benefits that provide a fixed-value return to the cardholder.  Largely, these perks are supplied on a calendar year basis. Examples include general travel or airline incidental credits (included on premium rewards cards), or the Saks Fifth Avenue credit on the The Platinum Card® from American Express.  Are you making sure that you use the full credit from all of your cards?
  2. Fixed Redemption: These are card benefits that have no specified dollar value, but are provided for annual redemption. The most obvious example in this category is the hotel free night certificates offered by many hotel-branded credit cards.  It's hard to know exactly how to value a free hotel night because the redemption likely changes year over year. One year, the free night might replace a $500 hotel room, and the next year it might replace a $100 hotel room.  As an example, I hold the Hilton Honors American Express Aspire Card and used the card's free weekend night during a trip to the Maldives with my wife this past year. That is not a vacation we take every year, though, and in 2020 we are far more likely to redeem the card's free night on a more modest trip. Have you made sure to use any fixed redemption perks your credit cards offer?
  3. Variable Redemption: These are card benefits that have no fixed dollar values or redemptions, and are largely qualitative.  Perks like lounge access, free checked bags, hotel program elite status, and more will all have different values to different cardholders based on how frequently they are used. Not only will usage vary by individual, but also the value of these benefits will be different for each person.

    Hilton Conrad Maldives
    Ithaa Undersea Restaurant at the Conrad Maldives. My wife and I redeemed our free weekend night certificate here, courtesy of my Hilton Aspire card.

Have My Cards Experienced Changes To Benefits Or Fees?

Much like frequent flier programs, credit cards and their costs and benefits are subject to change. Sometimes these changes are relatively minor, like an annual fee increase from $95 to $99. Yet, much more often, it seems to be the case that cards experience significant shake-ups. For example, Citi announced changes to its premium Citi Prestige® Card back in 2018, the last of which went into effect recently. Looking to 2020, Amex announced a major overhaul of benefits for its suite of personal and business credit cards. When card benefits undergo such extensive changes, it's essential to evaluate whether or not the card benefits still outweigh the annual fee.

In Which Bonus Categories Do I Spend The Most?

Savvy award travelers know that it is crucial to maximize your return on everyday spending. The key to realizing a maximum return on purchases is to utilize the bonus categories that various cards offer. Some cards, like the Chase Freedom Flex℠, offer rotating bonus categories that change each quarter. However, most cards feature fixed bonus categories. Common bonus categories include:

Identifying the bonus categories where you spend the most will help you decide whether or not your current suite of cards is getting you the most for your purchases. Do your credit card bonus categories align with your spending?  And do you put your categorized purchases on the most rewarding card?

Are There Better Credit Card Options Available?

Once you have had a chance to assess your credit card portfolio, you can take the next step of making any desired changes to your wallet. Quantifying whether you use all the perks and benefits of your cards, if your card benefits have changed, and whether your wallet is optimized for the bonus categories where you spend the most will help you make informed decisions for your overall credit card portfolio. Perhaps your credit card portfolio assessment has shown that you only earn 1% back on everyday purchases, and you plan to sign up for a new card to increase your return on everyday spend. Maybe your evaluation has shown that you don't make use of premium credit card perks enough to justify holding a particular card. And you plan to downgrade your card to keep the points you have accumulated without paying such a high annual fee. Or, perhaps one of your cards has announced sweeping changes that make the card less valuable to you, and you plan to cancel it entirely.

Final Thoughts

After all considerations are made, a decision might not be clear cut. Some individuals might prefer to earn transferable points, while others might target one specific rewards currency, or even cash back. There could be external factors in play, such as your 5/24 status with Chase. Or perhaps you have specific travel goals in mind in the coming months where certain credit cards will help achieve those goals.  As long as you make an honest assessment of your credit card portfolio and establish an action plan going forward, you set yourself up for great success in the world of points and miles for 2020 and beyond!

Will you be making any changes to your wallet this year?

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  • Wow! So with that many cards I’d imagine you’re signed up with loyalty/membership programs to just about every airline/hotel/rental car company you can think of, right? How do you ever use them enough to gain enough to redeem? Or does that all go back to how you’ve mentioned partners and transfers?

  • I used to think of credit cards as a necessary evil, and I avoided using them at all costs. At the same time, I knew I wanted to travel, especially with my kids (which can be expensive), and never understood how people managed to travel with their families and make it look so easy. I totally understand now, thanks to a lot of the tips in this blog. My points/miles balances have skyrocketed since I started using my cards on nothing more than normal spend as opposed to putting everything on my debit card. One question though: how many cards is too many cards to feasibly juggle? Or do you collect the cards and their signup bonuses, and then enter them into a rotation? What’s the best way to maximize the benefits of your portfolio?

    • Hi Lauren, it’s hard to answer with how many cards is too many. I’d recommend building up gradually and trying to find cards that give you long-term value that is greater than the annual fee. I currently “juggle” around 15 open cards, but I got to that point over a period of around 12 years. We’ll try to put together more content on this. Thanks for the question.

  • Superficially, cards with annual fees don’t seem to be worthwhile but our family has gotten so much value out of these cards over the years that it would be short-sighted not to have them. That being said, I have at least one card that I probably should cancel

  • I personally find it easy to look at the fees first and compare it with my spending habits. It also helps to have cards that complement each other, with some having better travel benefits while others can be used to make purchases in certain categories.

  • Identifying the areas where you spend the most is a must for everybody, one useful article.

  • Any recommendations on apps to track your credit card and points?

  • I love this concept of a credit card portfolio, which, I hadn’t considered before. I’m definitely one of those people that looks mainly at fees (aiming for none) and then try to get the bonus sign up points and then. I never really made a plan or viewed my credit cards as I would my investment portfolio, but realize I really should. Thanks for all the great info on how to do this!

  • great article. love how you breakdown the card into 3 categories, makes it easy to differentiate.

  • New to the points and miles game so this is useful in helping me plan my applications. Thanks!

  • rogelio fernandez says:

    Excelente info!

  • Great info! Thanks!

  • Great summary, I’ve previously only been interested in cashback schemes on credit cards but having finally used a lounge pass offer via my AMEX i can totally see the value in them. Well worth considering before choosing a new card.

  • Good point on evaluating changes in requirements on any CC. I was using a Sam’s Club card for gas purchases because of the 5% cash back annually, and I didn’t have to keep paying for Club membership (100 miles away, so not convenient to use). But then they changed the rules to require renewing the Sam’s Club membership, after a full year of purchases that earned almost $200. It is no longer attractive so I’ll be cancelling that card ASAP.

  • That rewards credit thou, especially Amex gold….I wish it was easier.

  • I hope this is not the year of major AF increases across the board. Not a good start with the CSR increase.

  • My process is a bit simpler. For regular spend, I try to maximize my cashback. Whenever I am getting a bit low on miles, I apply for a card with a good miles bonus, meet the minimum spend, then go back to maximizing cashback

  • Great timing with the CSR change. haha

  • Great write up. I always review my charge card “portfolio” at the beginning of the year. So timely for me!

  • Juan Ignacio says:

    I’ve finished reading the whole article and right now I want to go to the Maldives xD, btw nice overview thank you!

  • There are just so many variables to assess. This article does a good job of breaking down each component.

  • Just in the nick of time to assess renewing my Amex Platinum

  • Great article.
    I hope credit card companies will introduce more categories for bonus miles, such as department stores, gyms, online shopping, etc.

  • Thank you. I don’t review often enough. I tended to primarily use my AMEX SPG card as my everyday card because it transferred points to airlines with a 25% bonus when transferring 20,000. I am less excited by the Marriott card so considering others. Do you value Chase or AMEX points as highly as Marriott for transferring to airlines? if so I may change.

    • We value all four of the bank transferable currencies (Membership Rewards, Ultimate Rewards, ThankYou Rewards, and Capital One Miles) higher than Marriott points unless you intend to transfer to an airline that only Marriott supports.

  • We’re using free Hilton nights at Boca Raton Beach Club for my birthday this year. Connecting them two free nights with our Hyatt cards at the Confidante in Miami Beach will give us another area of the country to explore in very nice hotels.

    They may not be the most valuable nights, but they are very nice. When connected with free airfare, I think it’s a great way to celebrate my birthday in sun and sand!!

  • I’m sure you all are working on a post about this, but sadly the time has come to reevaluate the Sapphire Reserve card.

  • Very helpful as I have accumulated a number a cards now in this game and am trying to get a handle on which card provides the optimum benefit at any given situation – while tying it all in with the long range goals.

  • thomas Baginski says:

    Do you have any good card offers that can be switched with my current cards, rather than applying? I would like to beat my 9.9% VISA which offers a cash bonus. High $25k credit limit or greater would be nice so as to calculate less credit score impact. Please show a worthwhile offer that I can use rather than CC offers for startup households.

  • My priority definitely changed over the years. As cards are getting harder to churned, my priority slowly shifted toward flexible points or even just cash back.

    Definitely a good idea to reevaluate my cards as well.

  • This is a good post. It reminds us all to not be lazy and just let cards rollover year to year. It is also sometimes worthwhile to keep a not great fee card to upgrade and/or start a young student’s credit history.

  • Thanks for the helpful reminder. Useful article!

  • Good advice but the points game is getting harder everyday

  • Steven William Van Meter says:

    This would allow for a greater ability to organize points and get the most out of the points accumulated. I could use a better system like what this scheme provides.

  • Very informative. Thanks for summarizing it!

  • I determine the value of the benefits in relation to the annual fees.

  • great overview, thank you.

  • Good to know! Thanks!!

  • Thank you for presenting the thought exercise to show us how to analyze / quantify the benefits.

  • Something that should be thought of all year too. I am sure some are like me and have paid an annual fee already but will downgrade. I don’t think that we always think about downgrading. I am glad to be reminded of that as an option.

    I’m pretty picky about signing up for cards that I don’t think I would cancel any. I only get cards that I think will help me in the long run. I am sure some day I will narrow it down to fewer and fewer cards as my age advances. Will you all keep so many cards in your wallet as you get older or will get fewer to keep it easier?

  • Very interesting article thanks. I’ll be reviewing my options.

  • Great overview. I need to relook at the variable redemption benefits of my cards

  • Very useful guide. Thanks…

  • Good point. It’s time to review some costs and benefits.

  • Thanks for reminding me to do that sear upgrade now.

  • Very informative article. I always reevaluate each of my credit cards when the annual fees post. I said goodbye to my CITI Thankyou Premier last year and replaced it with a Chase UA Explorer credit card.

  • I think all my cards are keepers. Of course it helps that the fees of most were waived due to my deployment. Always good to reassess every once in a while.

  • Nice summary. Thanks!

  • You may also want to consider what impact keeping or getting rid of a particular card will have on your FICO score.

  • Susan Heath says:

    How do I update my email to my new email address?

  • Lot of good aspects to review yearly! Thank you for the reminders ?

  • Good advice. I definitely need to do this w/r/t my premium cards given all the changes.

  • Some cards make it difficult to get the rewards credit

  • says:

    Always trying to optimize, and with a limited travel plan for 202, the CSR card might not make it beyond this year’s renewal date.

  • That restaurant at the Conrad Maldives looks amazing!

  • Good to know, thanks!

  • Very well written article. Thanks!

  • Good overview – we focus on fees as a starting point, and don’t see a reason to change in 2020