Have you outgrown your credit card? Here are the 4 telling signs

When you have a trusty old credit card you’ve been using for years, reaching for that card may be second nature. But just because a card has been in your wallet for a long time doesn’t mean it still belongs there.

In fact, the old card you’re sticking with out of habit may be costing you a lot of money in extra interest or lost rewards. Staying with an old credit card too long can cause you to miss out on the chance to earn better rewards or lower the APR on your balance.

How can you tell if the card you’ve come to count on isn’t a good fit for you any more? Just watch for these four signs that you’ve outgrown your card.

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1. You’ve significantly improved your credit since you got the old card

When your credit score isn’t great, you’re limited in the credit cards you can get approved for. You may be stuck with a secured card, which is one that requires you to put down a deposit equal to your credit limit. Or you may end up with a card that has a very high APR and provides limited rewards.

If your credit has improved a lot since you got your card, a whole new world of credit card offers may be open to you. You could potentially qualify for cards with generous sign-up bonuses, tons of cardholder perks and generous rewards programs.

It’s absolutely worth looking into these options if you got your existing card by default because it was the only one you could get approved for at the time.

2. You routinely hit spending limits for bonus rewards

There are many rewards cards out there that limit the amount of bonus cash back or points you can get. For example, your extra 5% back may be limited to just $2,500 in spending across bonus categories per quarter or just $6,000 in grocery spending per year.

If you’re routinely spending much more than the amount you get a bonus for, you may be leaving money on the table.

It may be time to look for a new card that provides more generous rewards for all the spending you do rather than limiting you to earning extra points on a tiny percentage of your spending.

3. Your lifestyle has changed a lot since you got the card

When you signed up for that travel card as a young single person, it probably made a lot of sense if you took trips every month to visit friends and see the world. But now that you’re married with a couple of kids, the only trips you’re taking may be to Costco.

If this sounds like your situation, it’s probably time to switch to a new card that is a better fit for your lifestyle. In fact, any time your spending patterns or habits change a lot, it’s important to evaluate whether your current card is still right for you.

4. You’re carrying a balance now when you never did before

When you don’t carry a balance on your credit card, you don’t really need to care about the card’s APR since you won’t pay interest anyway. But if you’ve started carrying a balance, a high APR will wipe out any benefits that a credit card could offer as the interest you’ll pay will far exceed the value of even the best card rewards and perks.

Paying off your balance ASAP and avoiding carrying a balance in the future is the smartest approach. But this isn’t always possible. If you know it’s going to take you a while to pay off your credit card debt and you’re likely to carry a balance on a somewhat routine basis going forward, it’s absolutely time to switch to a card that has the lowest possible APR.

Don’t stick with an old credit card out of habit

If your card no longer fits your lifestyle or spending habits, there are plenty of great credit cards out there that would likely be a better fit. Check out our picks for the best rewards cards or 0% APR cards today to find one that’s right for you.

The Motley Fool owns and recommends MasterCard and Visa, and recommends American Express. We’re firm believers in the Golden Rule. If we wouldn’t recommend an offer to a close family member, we wouldn’t recommend it on The Ascent either. Our number one goal is helping people find the best offers to improve their finances. That is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.

The Motley Fool is a USA TODAY content partner offering financial news, analysis and commentary designed to help people take control of their financial lives. Its content is produced independently of USA TODAY.

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