Switching Credit Cards

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One of the most annoying aspects of travel hacking is cancelling your current cards and then applying for new ones. Many people find it to be a hassle and don’t want to deal with it. Others don’t like the fact that their credit score takes a hit every time they get a new card. While that’s certainly understandable, there’s a trick that can minimize your applications. Instead of cancelling and applying for a new card, all you need to do is switch your credit cards.

What is switching credit cards?

Switching credit cards is when you switch from one credit card to another within a family of cards or within a financial institution. For example, you could switch from the RBC Avion Visa Infinite Card to the RBC No fee Card. Alternatively, you can switch from the TD Aeroplan Visa Infinite Card to the TD First Class Travel Visa Infinite Card.

Doing a switch can be quite advantageous for a variety of reasons:

  • No hit to your credit score – When you switch credit cards, you’re not cancelling or applying for a new credit card. You’re literally switching cards, so no hard credit check is performed. Additionally, your limit just transfers over, so your credit utilization ratio doesn’t change either.
  • Can be more convenient – Switching cards can be done over the phone or via the online chat (when available) which is much less work compared to cancelling your current card and then applying for a new one.
  • You can still get the welcome bonus – The main you’ll want to switch is so you can get the welcome bonus that comes with the card you’re switching to. Many credit card providers state you can only get the sign up offer once every 12 months, so just switch your cards every year.
  • You get to keep your points – When switching from a higher tier card with an annual fee to a lower-tier card with no annual fee, you keep your points balance. This is ideal for people who are holding a card long-term, but don’t want to pay an annual fee.

Not every credit card provider allows you to switch and some only allow you to switch in specific circumstances. For example, American Express typically only allows you to switch from the Platinum Card to the Gold Rewards Card or from the SimplyCash Preferred Card to the SimplyCash Card.

You also can’t switch cards from one financial institution to another even if you’re earning the same type of points. For example, you can’t switch from the American Express Aeroplan Reserve Card to the TD Aeroplan Visa Infinite Card.

Switching credit cards example

The concept of switching credit cards can sometimes confuse people, so I’ll give you a real-life example. Before the global pandemic grounded many flights and closed borders, I planned a trip to London, U.K. for my cousin’s wedding. At the time, the WestJet RBC World Elite Card had a great welcome bonus and came with a companion voucher, so I signed up for it.

I obviously had to cancel my trip, but I was left with quite the dilemma with what to do with my card. I wasn’t sure when I’d be flying again, so hanging onto the card for the yearly companion voucher and free checked bags probably wasn’t worth it. Since WestJet dollars don’t expire, I could have just cancelled the card and moved on.

Instead, I looked at RBC’s other credit cards and realized I could switch my WestJet RBC World Elite Card to the RBC Avion Visa Infinite Card. The annual fee was the same, and I confirmed with customer service I would still get the welcome bonus since I was doing the switch 12 months after my application. 

I personally did the switch over the phone, but customer service let me know that I could also do things from within my online account. As an added bonus, RBC Rewards points can be transferred to WestJet dollars at a ratio of 100:1. In other words, I could convert my points to WestJet dollars and switch my card again in a year to earn more WestJet dollars.

Keep in mind that if you’re switching from one card to another and they earn different points, you could lose them. For example, when I switched from my TD First Class Travel Visa Infinite Card to the TD Aeroplan Visa Infinite Card, TD advised me that I would lose all my TD Rewards points that I had earned. I knew this was going to happen, so I used up my points before making the switch.

Keeping track of your credit card applications

Regardless of if you plan on switching your credit cards or applying for new cards, you need to keep track of your applications. The assumption is that you’re going to cancel or switch your credit card about 12 months after your initial application, so you’ll need a reminder of that date.

The easiest way to do this, especially for people who are only getting one new card a year, is to set up a calendar reminder 11 months from the time you apply for a card. The reason I say 11 months is so you can cancel or switch before your next annual fee posts. Having that one-month buffer will give you more than enough time to take care of things.

If you’re applying for multiple cards a year, you probably want to start a spreadsheet with all your details. This will give you a clear reminder of what you applied for and when. You can then cross-reference any rules to ensure that you still qualify for the welcome bonus when applying for a new card.

Even if you forget to set up a reminder and your annual fee posts, you still have some options. If you call your credit card within 30 days of your annual fee posting, you’ll usually be able to cancel your card and they’ll rebate you the annual fee. Don’t forget to use or transfer your points out before you cancel/switch!

Switching credit cards is a trick that can help you maintain your credit score in good standing while taking advantage of the welcome bonuses offered by credit cards. Casual travel hackers will only need to switch one card a year, so it’s not a big deal.

Travel Hacking for Lazy People

Switching Credit Cards

About Barry Choi

Barry Choi is a Toronto-based personal finance and travel expert who frequently makes media appearances. His blog Money We Have is one of Canada’s most trusted sources when it comes to money and travel. You can find him on Twitter:@barrychoi

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