I’ve opened more than a dozen credit cards and figured out exactly how opening a card for the bonus affects my credit
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New credit cards temporarily lower your credit score, but using them responsibly can raise your credit score in the long run.
Sign-up and welcome bonuses can be a good incentive to open a card, but otherwise a card you open for a points or miles bonus behaves the same as any other card.
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Reading Chris Guillebeau’s popular blog, The Art of Non-Conformity, I found that signing up for credit cards and earning bonuses is a quick path to free and discounted travel.
But as a former bank manager, I knew there would be costs on my credit report if I went on a card-opening spree.
I got my first card specifically for rewards. It was a British Airways Visa Signature Card, and I took home a huge bonus (no longer offered) worth enough for a trip to London, Paris, and Amsterdam. In the years since, I’ve opened more than a dozen credit cards and added quite a few lines to my credit report.
Over time, I’ve found opening cards for the welcome bonuses helps — not hurts — my credit. But that’s because I’ve kept my balances low, made my payments on time, and avoided borrowing more money than I can repay.
The welcome bonus can be a good reason to choose a card in the first place, but ultimately any card you open should be used responsibly.
What happens to your credit when you apply for a new credit card
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Source:: Business Insider