Credit Cards: Look Beyond the Sign-Up Bonus
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What headlines set the stage for this Money Briefing?
With your Money Briefing, I'm Charlie Turner in New York for The Wall Street Journal. We'll discuss why it's important to change the credit card you use most often. First, here are some money headlines. The Wall Street Journal says a big problem dogging Bitcoin is fake trading. According to a study by Bitwise Asset Management, nearly 95% of all reported trading in Bitcoin is artificially created by unregulated exchanges. That raises fresh doubts about the nascent market following a steep decline in prices over the past year. Fraudulent trading volume has dogged cryptocurrency trading for years, but the extent of the market manipulation has been difficult to determine. Bitwise said its analysis of trading activity at 81 exchanges over four days in March indicates that the actual market for Bitcoin is far smaller than previously thought.
Bitwise submitted its research to the Securities and Exchange Commission with an application to launch a Bitcoin-based exchange-traded fund. The study is an attempt to alleviate the SEC's longstanding concerns that a Bitcoin ETF would leave investors exposed to fraud and market manipulation. Pizza chain Papa John's has made a big move.
Why should you consider changing the credit card you use most often?
A big, big move. The company announced that retired basketball star and restaurant entrepreneur Shaquille O'Neal will join its board of directors and become an ambassador for the brand, while also investing personally in nine Papa John's restaurants in the Atlanta area. Investors cheered, sending Papa John's stock rising in a down market Friday. After all, Papa John's certainly could use a more popular pitchman. The company's founder, John Schnatter, agreed to leave the company's board earlier this month after a year of both infighting and some controversial comments. Among those he alienated were a major sports league and African-Americans. Still ahead, J.R. Whelan talks with CreditCards.com's Ted Rossman about getting the best use out of credit cards.
It's easy enough to swipe your credit card at the checkout counter and cash back rewards are among the benefits that make them worth their while with consumers. That's according to a new survey by creditcards.com. But looking beyond the rewards can make the difference between extra cash in your pocket and leaving money on the table that someone else can scoop up. CreditCards.com analyst Ted Rossman is here to discuss. So Ted, people's spending habits change as they buy a house, have kids, go to graduate school, things like that. And they should make it a point to shop around for the right credit card as all those different life events happen.
You're absolutely right. Your lifestyle changes and your credit card should, too. Unfortunately, what we found in our new survey was that about one third of cardholders have switched in the past three years.
How many cardholders regularly switch cards and who is missing out?
That's it. Everybody else has held on to their cards for a long time. We found that 30 percent have never switched their favorite card.
I was amazed at this number. Fifty three million people have never changed the card they use most often.
That's shocking, isn't it? It really is. And there's another 16 million who switched, but it was a decade or more ago. So lots and lots of people are missing out. The golden age of credit card rewards is right now. We've never seen sign-up bonuses as generous as we've seen in the past few years. Ongoing spending rewards are really hot. For example, over the past year and a half, there's a whole new group of cards that are offering four, even five points per dollar on restaurants. If you haven't compared cards in a while, you're definitely missing out.
And if somebody is going to change credit cards, it's important to look up the interest rate associated with transferring balances because that's a very competitive area.
It is. And I'm glad you brought up interest rates because we all get so enamored with rewards and free trips and cash back. But the fact is that 60 percent of cardholders are carrying debt from month to month. So for those six and 10 cardholders, they really need to prioritize their interest rate.
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Chapters
4 chapters
1
What headlines set the stage for this Money Briefing?
0:06–1:13
2
Why should you consider changing the credit card you use most often?
1:13–2:51
3
How many cardholders regularly switch cards and who is missing out?
2:51–4:37
4
What ongoing rewards and perks are making the ‘golden age’ of cards valuable?
4:37–8:31
Speakers
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