Wins! You win, I win!

End of Year Cash Grab

Getting into rewards, I learned about “Mileage Runs” that people do to achieve particular statuses on airlines. But I hadn’t heard of this until the notion popped into my head. As you’ve seen, I’ve added a number of new cards to my wallet in the last couple of months.

I noticed that there was an untapped space in my rewards cards. There are a plethora (I love that word) of credit cards with $0 annual fees, earn cash back, AND have sign up bonuses when you meet their minimum spend requirements. What could go wrong?

Well, how about my credit rating?

Nope. Let’s take a look at how credit ratings are determined.

On time payments. This has the highest impact on your credit score. If you make your payments on time and on schedule, you are off to a good start. The longer, the better.
Available credit. High impact. Add up all of your debt, and divide by your total amount of credit. The lower this number is, the better.
Average age of credit. This has a moderate effect on your score. As this number gets higher, so does your credit score.
Total number of accounts. Moderate effect. The more the merrier.
Credit inquiries. Low impact. As you ask for more and more credit, this has a small negative impact on your credit rating. Expect a small time dip in your score, but hold off on new cards for a while, and it’ll creep back up.
Negative inquiries. HIGH IMPACT. If you do well on the above, you shouldn’t have to worry about this affecting you. Keep it at 0.

After opening 8 new cards in a two month period, I saw the following effects:

Right off the get go. My score jumped 15 points as my percentage of available credit dropped.
My score dipped 4-5 points as my credit inquiries increased and my average age of accounts dropped.
Over additional time, my score crept up a couple of points.

Now on to the meat and potatoes. Keith! My man! What cards did you get? How’d those work out for you?

Great questions! I am glad you asked.