Weekend TWG Homework Assignment: What are the Best Credit Cards for Downgrades or Conversions?
Good evening everyone, TGI (Thank Grant It’s) Thursday. I will be flying up to San Francisco Friday night and coming home early Monday morning from Oakland. I will not be blogging this weekend, but I will bring my phone so I can respond to emails and blog comments. Since the collective knowledge of TWG readers is far superior than just my knowledge, I need your help. I am working on compiling a page on best credit cards for downgrades or conversions. For every annual fee credit card from a bank, there is a related no annual fee credit card.
Do you remember that kid in school who always asked the teacher if there was any homework due next week when the teacher clearly forgot to assign any? Well, you can all thank Dan P for the suggestion (link):
I think a blog post about all the “good downgrading cards” would be great. Include the BoA Better Balance Rewards and the Citizens Bank Green$ense (pays you $0.25 per transaction, up to $20 per month; great for purchases under $5) in addition to other cards. Although other than those two I haven’t found any really useful, zero annual fee cards.
Steven got the ball rolling with this comment:
Best practice is to convert the Alaska card to a Better Balance card which will award $100 a year for minimal spending. I have 6 of them. :)
Followed by Jivepicnic’s comment:
I only have one Better Balance Card, so I have some work to do to catch up to Steven! I purchase an Amazon eGC for $0.50 each month, so I spend $6 per year to get $100. Actually for me it’s $120 because you get a $5 bonus per quarter if you have a BofA checking account as well.
Clearly, I have been living under a rock since I was unaware of this card until a few days ago. I have closed several Bank of American credit card in the last 2 years to avoid the annual fee, when I could have earned $100 a year for keeping a credit card open (link).
To help me out, please share any credit cards (personal or business) that have decent rewards for downgrading or converting a credit card. Downgrading and converting credit cards are very similar and the only distinction I can think of is the family of credit cards. For example, you can downgrade from a Chase Sapphire Preferred ($95 annual fee) to a regular Chase Sapphire (no annual fee). In comparison, you can convert your Chase Sapphire (no annual fee) to a Chase Freedom (no annual fee).
One of the main drawbacks of downgrading or converting a credit card is that most of the time you bypass the sign up bonus in exchange for no hard credit inquiries. When I downgraded my Chase Sapphire Preferred to a regular Chase Sapphire, I did not get the sign up bonus, but there was no hard credit inquiry and my credit card number stayed the same. After using that card for a few months, I decided to convert the regular Chase Sapphire to a Chase Freedom. I also bypassed the sign up bonus on that card, there was no hard credit inquiring, and my account number stayed the same.
The last example I have is that I converted a Citi American Airlines Platinum AMEX to a Citi Dividend MasterCard. The conversion took almost 2 months for Citi to send me the new credit card and for them to close the old American Airlines credit card. There was no hard credit inquiry, but I did bypass the sign up bonus. Don’t feel too bad for me though, I earned $300 cash back with that credit card in January (link).
Here are my suggestions for now:
- Chase Sapphire Preferred (or any Chase credit card that has an annual fee) >>
- Chase Freedom (no annual fee) for the 5% rotating cash back categories, earn up to $300 per year in cash back
- Citi American Airlines (or any Citi credit card that has an annual fee) >>
- Citi Dividend MasterCard (no annual fee) for the 5% rotating cash back categories, earn up to $300 per year in cash back (no quarterly cap, only $300 annual cap)
- Bank of American Alaska Airlines (or any other Bank of America credit card that has an annual fee) >>
- Bank of America Better Balance Rewards (no annual fee) for the $25 cash back every quarter, up to $100 cash back every year
- American Express >>
- US Bank >>
- Barclays >>
- Discover doesn’t have any credit cards with annual fees >>
- Discover It (no annual fee) for the 5% rotating cash back categories, earn up to $300 per year in cash back
If you have any helpful information, please share in the comments below. Have a great weekend everyone!