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The right credit card could be the right financial move in 2019

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If you’re the kind of person who sets annual financial goals, you’ve probably got a piece of paper somewhere with the words “earn more” or “stick to a budget” written on it. Maybe you’re focused on minimizing your day-to-day expenses, or maybe you want to max out your retirement accounts or set up a side hustle. All excellent goals.

You probably don’t have “get a new credit card” on your financial to-do list, though — which might be a mistake. Believe it or not, getting the right credit card could be the best financial decision you make this year — even if you’re currently in credit card debt. Here’s why.

A top rewards card can help you earn rewards on everyday expenses

If you’re paying for everyday expenses like groceries and restaurants without earning rewards, you’re leaving money on the table. Whether you choose a flat-rate cash back card that offers the same points on every purchase or a bonus category rewards card that gives you higher rewards for certain categories of purchases — and we’ve got a list of the pros and cons of both — you’re going to want one of the best rewards credit cards in your wallet. You’ll also want to use it for the majority of your purchases.

Otherwise, you’re going to do all that day-to-day spending without getting anything in return.

The Capital One® Savor® Cash Rewards Credit Card, for example, is currently offering unlimited 4% cash back on restaurant and entertainment spending — that’s $40 back for every $1,000 you spend — plus a new cardmember bonus that could get you an extra $300 if you spend $3,000 in your first three months with the card. How often are you going to get an extra $300 just for doing your everyday shopping?

Of course, you don’t want to pay more in interest than you’re earning in rewards, so before you drop $3,000 on your brand-new credit card, make sure you can pay it off. The first rule of responsible credit use is don’t spend more than you can afford to pay back, after all. An extra $500 now is not worth thousands of dollars in credit card debt later.

A good travel credit card can cut your travel costs

Some people put all of their daily expenses on a cash back credit card, but frequent travelers often prefer to use a top travel rewards card for their purchases. Whether you prefer a card that rewards multiple types of travel expenses, such as the Chase Sapphire Preferred® Card, or an airline rewards card or hotel rewards card that rewards loyalty toward a specific carrier or brand, savvy travelers know that they can save money on everything from airport lounges to vacation packages.

Plus, travel credit cards come with some extremely valuable bonuses and perks, from trip insurance to free hotel stays. The new cardmember bonus alone should be enough to cover the cost of a flight, depending on where you plan to travel — and when you get a travel credit card, you may find yourself making travel plans much more often!

A balance transfer credit card can get you out of debt interest-free

If you’re in credit card debt, the last thing you need is another credit card, right? Not necessarily. Used properly, a balance transfer credit card can help you get out of credit card debt without paying interest — which is probably a better deal than whatever else you’re currently doing to pay down your debt.

Here’s how balance transfer cards work:

  • After you open the card, you transfer your balances from your existing credit cards onto your new balance transfer card.
  • You’ll have to pay a balance transfer fee — generally around 3% of the balance being transferred, or $30 for every $1,000 of debt.
  • Then you take advantage of the balance transfer credit card’s 0% intro APR offer to pay off your transferred credit card debt interest-free.

If you’re going to use a balance transfer credit card to get out of debt, be aware that timing is everything. In some cases, you have only a limited amount of time to transfer balances to the card before the balance transfer fee increases. The Wells Fargo Platinum card, for example, charges 3% per balance transfer ($5 minimum) for the first 120 days and then bumps the fee up to 5% per transfer ($5 minimum).

Likewise, you’ll want to get those balances paid off before the card’s 0% intro APR period ends. You need to pay off the debt you’ve transferred before the 0% intro APR period runs out and you start paying the regular APR — which would defeat the purpose of the 0% offer.

A 0% intro APR card can help you fund a big purchase

Credit cards with introductory 0% APR rates aren’t just good for balance transfers and debt consolidation. Many of the best 0% intro APR cards can also be used to fund a large purchase interest-free.

Imagine that you’ve just moved into a new apartment and are shopping for new furniture. You could sign up for the store credit card and save 15% on your purchase — but retail credit cards tend to have extremely high interest rates, so if you if you don’t pay for that purchase off right away, you’re going to be paying back all the money you saved in interest.

You could also put that new furniture on a card that offers 0% intro APR on purchases, which would give you as much as 18 months to pay off the interest-free (depending on the card and the offer). How often do you get the opportunity for the equivalent of an interest-free loan?

Use 0% intro APR cards to fund big purchases or expensive life transitions, but make sure you’ll be earning enough to pay off that credit card balance before the intro period comes to an end.

Building credit now could save money in the future

Here’s the biggest reason to get another credit card this year: adding another line of credit can help you build your credit score and save you a lot of money when it comes time to apply for a mortgage or a car loan or other credit-related activities.

Why? Because the big three credit bureaus — Equifax, Experian and TransUnion — calculate your credit score based in part on credit utilization, or how much credit you have vs. how much credit you’re currently using. In other words: If you have a lot of credit but are using only a small part of it, your credit score tends to be higher.

Opening up that new credit card, even if you’re only in it for the sign-up bonus, could save you money the next time you buy a car. Or a house. Or sign up for a phone plan, because people with higher credit scores tend to get get better offers. You may even get a better interest rate the next time you apply for a credit card — though if you’re the kind of person who’s focused on maxing out their credit score, you’re probably paying off all of your balances before they have the chance to accrue interest.

If you aren’t paying off your credit card balances before they turn into debt, make that the best financial decision you make this year. Remember: Getting a new credit card is often a smart financial choice, but managing your credit responsibly is even smarter — so if you’re not currently on top of your credit, you’ve got yourself a new top financial goal.

Written by
Nicole Dieker
Personal Finance Contributor
Nicole Dieker has been a full-time freelance writer since 2012—and a personal finance enthusiast since 2004, when she graduated from college and, looking for financial guidance, found a battered copy of Your Money or Your Life at the public library. In addition to writing for Bankrate, her work has appeared on, Vox, Lifehacker, Popular Science, The Penny Hoarder, The Simple Dollar and NBC News. Dieker spent five years as writer and editor for The Billfold, a personal finance blog where people had honest conversations about money. Dieker also teaches writing, freelancing and publishing classes and works one-on-one with authors as a developmental editor and copyeditor.