Deciding On A 5/24 Credit Card Strategy

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At the moment I’m in a position where I need to decide if I’m going to take a break for a few months from applying for credit cards, or if I shouldn’t. I feel like I haven’t put enough thought into this in the past, which is why I’m currently in this position.

At the beginning of the year I shared the 21 credit cards that I’m starting 2018 with, and in this post wanted to share the two paths I’m trying to decide between.

Should I get below 5/24?

Nowadays Chase generally has among the most compelling credit cards, and many of their cards have a “5/24 restriction,” where you can’t be approved if you’ve opened five or more new card accounts in the past 24 months. This doesn’t apply to all Chase cards, though.

Chase cards not subject to 5/24

I just checked my CreditKarma account, and first of all I’m quite proud of my credit score.

Take that, people who say having lots of credit cards is bad for your credit score. 😉

More importantly, I’m actually getting close to being under the 5/24 limit. Here’s the credit history for my most recent new card accounts (see this post for how to check your 5/24 score):

As you can see, in about 4-5 months I should be at the point where I’m only showing four new card accounts on my personal credit report within the past 24 months.

The thing is, there are some cards I really want to apply for right now, and I can’t decide if I should first get under the 5/24 limit, or if it’s not worth the opportunity cost to wait.

Let’s look at both sides of this.

The reason I want to get under 5/24

Why do I want to get under the 5/24 limit? Specifically because there are three cards that I really want, not just for the great welcome bonuses, but because I’d get a lot of value out of them long term:

The $95 annual fee Ink Business Preferred℠ Credit Card:

  • Offers a welcome bonus of 80,000 points after spending $5,000 within three months
  • Offers 3x points on the first $150,000 of combined purchases per cardmember year on travel, shipping purchases, internet, cable, and phone services, and advertising purchases made with social media sites and search engines
  • Has an incredible cell phone protection plan that I’d get a lot of value out of

The no annual fee Ink Business UnlimitedSM Credit Card:

  • Offers a welcome bonus of 50,000 points after spending $3,000 within three months
  • Offers 1.5x points on all purchases

The $95 annual fee Marriott Rewards® Premier Plus Credit Card:

  • Offers a welcome bonus of 100,000 Marriott Rewards points after spending $5,000 within three months
  • Offers an anniversary free night award valid at a property retailing for up to 35,000 points per night

Just by getting to “4/24” I could pick up all three of these cards. That’s because while the two business cards are subjected to the 5/24 restriction, applying for them doesn’t actually qualify as a further inquiry towards that limit. So I could pick up the two Ink Cards and then the Marriott Card.

Cards I’m missing out on if I wait

In order to get below the 5/24 limit, I wouldn’t be able to apply for any personal credit cards in the next 4-5 months, so I’d be missing out on quite a few new cards that I’m interested in. Most notably:

The $89 annual fee IHG® Rewards Club Premier Credit Card:

  • Offers a welcome bonus of 80,000 IHG Rewards Club points after spending $2,000 within three months
  • Offers an anniversary free night award valid at a property retailing for up to 40,000 points per night, so this is a card I’d hold onto long term
  • Offers a fourth night free on award redemptions, which would get me significant value

The $95 annual fee (waived the first year) Citi ThankYou® Premier Card:

  • Offers a welcome bonus of 50,000 Citi ThankYou points after spending $4,000 within the first three months
  • Offers 3x points on travel and gas, and 2x points on dining and entertainment

The card I can get either way

The one credit card that I plan to apply for either way in the coming days is the CitiBusiness® / AAdvantage® Platinum Select® World Mastercard®, which is offering a welcome bonus of 70,000 AAdvantage miles after spending $4,000 within the first four months, with the $95 annual fee waived for the first year.

Why can I get this either way? Because applying for a Citi business card doesn’t count towards the 5/24 limit, so getting this has no bearing on when I’d actually fall under 5/24.

Amex cards that are somewhre in the middle

Somewhat related to this is my general American Express credit card situation. Amex limits you to having five credit cards (regardless of whether they’re personal or business), and that excludes charge cards. I’m maxed out on American Express cards, as I have the following:

I get value from each of those cards, and am generally tempted to keep them. However, there are some other Amex cards I’d eventually like to get:

  • The $95 annual fee Hilton Honors American Express Business Card is offering a welcome bonus of 125,000 Honors bonus points after spending $5,000 within four months; applying for this card wouldn’t count towards 5/24, so in theory I could apply soon, but I am maxed out on Amex Cards, so…
  • The $450 annual fee Hilton Aspire Card offers Hilton Honors Diamond status, a $250 annual airline fee credit, a $250 Hilton resort credit, and more
  • The $450 annual fee SPG Amex Luxury Card is being introduced in August, and will offer a $300 statement credit for Marriott/Starwood purchases every year, an anniversary free night certificate valid at a property costing up to 50,000 points per night, and much more

I think eventually I’ll probably cancel the two old SPG Amex Cards, and instead get the new premium Hilton and Starwood Cards.

Bottom line

People ask me all the time whether they should hold off on getting new cards so they can get under 5/24, or if they should go ahead and apply now, and forget about it. The truth is that I’m as indecisive as the rest of you. 😉

There’s always a tradeoff here, and that’s something I’m experiencing personally right now, given that credit cards keep getting more compelling. Personally I’m leaning towards holding off five months so that I can hopefully get the Ink Business Preferred℠ Credit CardInk Business UnlimitedSM Credit Card, and Marriott Rewards® Premier Plus Credit Card. Those are all cards I’d get a lot of long term value out of.

However, that means I may miss out on several good offers in the meantime, which is never fun.

One thing is for sure — I need to make up my mind, because I feel like the past couple of years I’ve been going back and forth, and then I end up applying for a card here and there. That’s why I’m almost always just above the 5/24 limit.

What would you do?

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Comments

  1. A personal decision, but imo unless you have some other reason for not applying for credit cards, it’s rarely worth getting under 5/24 for Chase. Yes Chase has some of the best offers but in no way justifies missing 100’s of thousands of Amex/Delta/Citi/AA etc points per year to get a limited amount of UR bonuses only 2x per year.

  2. Dont you have any cards that you opened and closed in the last 24 months?
    Usually these dont show up on your Credit Karma report to check 5/24.
    I had opened twice the TD bank Aeroplan Credit Card and closed it on both occasions.

  3. In my opinion you should take the Citi Thankyou premier card and then probably wait for Chase 5/24 to cool down

  4. I’m in the same limbo and have been scratching my head for few weeks. THANK YOU so much for this amazing post Ben!!!

  5. Well, here’s a question: based upon your points needs for the next 4-5 months? Do you think you’ll need any of the IHG, ThankYou, or Amex cards points? If not, why not just hold out and apply for Chase cards? Especially if you will use those Chase cards much more often on a regular basis, is it worth it to wait a couple of years just to get an IHG or Citi card now?

    Those are my thoughts, but what do I know? I’m about 4 months from 4/24, so I’m holding out right now (but I don’t travel NEARLY as much as you do :)).

  6. The benefit of having a spouse and limited (but still high) income. We take turns on application runs to ensure that one of us is under 5/24 for at least a period of time every 12 mo or so. That allows us to get Chase 5/24 cards, while still maxing out other signup bonuses to the extent we can meet the spend requirements. We can do about $2,000 in non-bonused spend a month pretty easily, without paying any Plastiq or other payment processing fees (still putting bonused spend on CSR, Amex Plat, etc.). That lets us get a sign up bonus every 2-3 months, and grab good Chase opportunities when they come up. Everyone wanted the CSR, but those without a strategy missed out on the 100k sign up bonus.

  7. I am at 4/24 and in similar situation about what to apply for next; been focusing on non-Chase business cards so reducing inquires shown on personal report and Chase system.

    I am curious: from the 21 cards you currently hold and your plans for other cards, are you not concern with Chase shutdown (bust out)? Or are you immune due to being Chase advertiser?

  8. hi there. im kinda like you in that i am also trying to wait to be under 5/24 to apply for a chase card. i dont have a good every day spend card but i have the csp so im trying to wait to get under 5/24 and apply for the chase freedom or chase freedom unlimited. good article!

  9. If I’m under 5/24 should I grab the Marriott (and then ditch my SPG Amex post merger) now and then apply for the Citi TY Premier? My thinking is the Marriott as I’d have more of a short term use for the points.

  10. @Lucky – how do I actually determine if I am under 5/24 for the purposes of the credit pull that Chase will do when processing my application? Credit Karma says that I have only had one account opened in the last two years but I have at least four non-business cards that should be reflected on there (per my own spreadsheet).

    I am going to have to downgrade my Preferred before I can apply for the Reserve and don’t want to spend several months with only a Freedom waiting to be under 5/24 in Chase’ eyes. Should I trust Credit Karma or rely on my personal data?

  11. @Dan – Credit Karma likely doesn’t count cards that have been closed. If you opened cards within the last two years and have closed them AFAIK Chase will count them toward 5/24. So you may need to do your own math based on looking at account open dates for your closed accounts.

  12. Good post! I’m lying I’ve gotten dressed too many compelling a girl for us so I’ve given up. I got the Iberia card, the Hilton Aspire, the Delta gold AMEX with no lifetime language, another Alaska card, just in the last few monthes. Then there is the new IHG card cads on the horizon for my next batch. And I’ll be able to requalify for new Citi American cards. Trust too many points left on the table for 5/24 to be realized for me.

  13. It seems like spellcheck has made me look like an idiot. Please ignore any idiotic sentences in the prior post !

  14. What about the other factor, the cards you are interested in would require that you spend $24,000?

  15. I’m definitely not limiting applications to get under 5/24. I have all the Chase cards I really want. It just makes no sense to me to pass up so many other opportunities for hundreds of thousands of points. Maybe if I didn’t have an ink or a CSR….

  16. Rules for Being Approved for Chase Business Cards Have Changed

    I just got first-hand experience today that Chase has begun enforcing the requirement that one must have a “business” to be approved for their business credit cards.

    I went to the Chase branch next to my office today to apply for the ‘Chase Ink Business Cash’ visa, sure that I would just waltz in there, be approved instantly and then I would waltz in about 15min. Nope. I was in there for over an hour because I had to provide information about my ‘consulting business’ as a sole proprietor to be eligible to apply for the card. After I provided the info, my assigned Private Client agent had me sign a credit card disclosure that started by stating the eligibility criteria:

    “To be eligible for an Ink Business credit card from Chase, the Company must be headquartered within the 50 United States or District of Columbia…etc…”

    and then required that “I certify, understand and agree” that:

    “This is a business account which shall be used only for business purposes and not personal, family or household purposes;”

    and 7 other such statements about liability, authorizing Officer of the Company, etc…

    My passport was scanned, as would have been my driver’s license if I had one. Instead, my Chase Private Client debit card was scanned a my second form of ID.

    After all that and over one hour after I walked into the bank, my application was submitted and I was approved instantly for the ‘Chase Ink Business Cash’ with a credit line of $14K.

    So, there you have it. I simply had to get this business card because teamed up with the CSR and CFU, it would give me the Perfect Trifecta. I was leaving a lot of points on the table by charging my internet, cable and phone services — all fairly large ticket items — to the CFU and getting ‘just’ 1.5X when I charging the same recurrent purchases to ‘Chase Ink Business Cash’ would get me 5X, not mention the fact the card has no AF and that it currently has 50K UR signup bonus. Thus, getting this card was no-brainer and long overdue for me. Just remember that you’ll now need to jump through some hoops before getting this and other Chase Business cards…

    G’day.

  17. How do you go about canceling credit cards? What are the repercussions?Maybe a post to understand if there is a negative impact to closing more recent cards if there aren’t any balances on it and if your credit score is excellent.

    For example, I find myself starting to amass credit cards where the fees will hit sometime next year (but I am not using them because their points accrual are not as good as other cards I have). I currently have about 6 cc’s (Reserve, MileagePlus, Freedom Unlimited, Chase Business Ink Preferred, Citi Aadvantage, Barclay Aadvantage Mastercard) in my Wallet and have downgraded the longer history ones to no-fee ones, but it’s the more recent ones I find that I’m not using and aren’t downgradeable. It obviously is not good to keep cards with fees that you don’t use and I also want to try new/better products. But there’s not much information about the negatives around cancelling cards and when is best to.

    Thanks

  18. I’m also in a really similar situation and just dropped under 5/24 to 2/24. I did apply a few days ago for the Ink Cash (I have the old Plus and am thinking of combining the two lines and killing the Plus AF – I’m not getting to 50k on the Plus in bonus cats). I already have the Freedom Unlimited and the Sapphire Preferred (when they converted my Fairmont) so I’d still have the UR points ability (though they usually go to my wife’s CSR). I’m also in a similar AMEX situation but I’m really considering the Blue Biz plus. I’d like to get my MR balance up a bit as I’ve been burning them more regularly. I had my AF on the Citi TYP hit and called Citi and they gave me a pretty solid retention offer so I’m keeping it. Interested to see if you hold off Ben (although with all the Chase rumors flying about who knows if UR will continue to be as flexible).

  19. I’m at 1/24; with only the CSR. Basically I’m covered for travel, and don’t use hotels that much. Doesn’t anyone have any recommendations for good cards for someone living abroad? I wouldn’t get any use out of delta/United/American cards, and prefer something with a benefit I don’t have that’s good. Thanks

  20. Just got under 5/24 this month (current 4/24). Applied Ink Cash pending, and got approved automatically after few days. While waiting to get even more slot for more chase cards (will go 3/24 in July and 2/24 in December), my strategy is getting Ink Prefered in Aug, and either Ink unlimited or UA biz in Dec. After getting all 5/24 chase biz cards that I want then will go ahead to get the personal 5/24 cards such as CSR, Marriott, or UA

  21. @Eric NYC – thanks for confirming that. I have always kept pretty good records and knew what Credit Karma was telling me was too good to be true.

  22. Lucky – I enjoy your blog, thanks. In your January 2018 post, you recognized that Credit Karma doesn’t include closed accounts. So if you opened & closed cards within the 24 month period, they won’t show. Shouldn’t we use one of the 3 credit bureaus for free credit reports instead of Credit Karma for this purpose? Thanks again.

    Steve

  23. So, I guess I’m a newbie at this and I am a bit confused. I used to have the Chase Marriott card and found out that in 2014 I received the sign up bonus miles. I haven’t had the card in a while but am not exactly sure when I canceled it …. probably in 2016. So, if I apply again, would I be able to get the 100,000 Marriott points? I think the only other Chase card I have is Chase Sapphire Reserve. I may have had a Southwest Airlines card for a year or so. I don’t keep records like many of you …. how do I find out what my number in 24 months is? Can I call Chase and find out from them?

    MANY THANKS for your help!

  24. @ Andrea G. — Yes, if you don’t currently have this card or the other Marriott Card then you should be eligible for the bonus. Let me know if you have any other questions. 🙂

  25. Ben,

    I am missing something from your statement that “… while the two business cards are subjected to the 5/24 restriction, applying for them doesn’t actually qualify as a further inquiry towards that limit.” I always thought Chase counted Business Cards issued by Chase (not AMX Business or Citi Business) for the 5/24 restriction. Have I been wrong all these years? Please further explain.

    Thank you

  26. Thank you! I’ll get the Marriott card and that I’ll get the points. I have Gold status for SPG and Marriott but will be downgraded soon. Not nearly enough stays for lifetime but a free night is nice once in a while.

  27. @ Old Flyer — Indeed, Chase Ink Cards are subjected to the 5/24 rule, meaning that you can’t be approved if you’ve opened five or more new card accounts in the past 24 months. However, applying for these cards doesn’t count as a further inquiry towards the 5/24 limit, since Chase business cards won’t show on your personal credit report.

    Hope that makes sense, and let me know if you have any other questions. 🙂

  28. Ben,

    Sorry, but this Old Flyer doesn’t get the difference unless you mean it won’t count when applying for a Chase personal card. If you apply for a Chase Business Card, then it must count. Am I still wrong? Must be the age or something?

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