How to Pick the Best Credit Card in Retirement

Yes, you’re retired, but you still need to work on your credit score. If your household debt — be it a mortgage or car loan — is paid off, responsible use of credit cards is the best way to keep that score high.

You might think: Why bother? After all, you don’t plan to ever apply for a mortgage again. But you’re still driving a car, right? Credit scores impact the auto insurance rate you pay, and the car loan terms you get.

And let’s not forget that an excellent credit score will make you eligible for the best credit cards. When you’re no longer actively generating income, you want a card that pays you the best cash-back or travel rewards.

To find your one best card, stop by our Solutions Center and search for credit cards offering different types of rewards. Several factors will determine the best type of card during retirement, including:

Your income

If you’ve reached the $1 million benchmark for retirement savings, income in retirement should not be a problem. But for a large percentage of people, that’s unlikely to happen.

If you’re facing a reduced income, you want a card that works for you. That means a card that rewards you for expenditures that are unavoidable. Look for a card with no annual fee whenever possible. Also look for:

  • Generous cash back on basics like gas and groceries. Many of these cards do not have an annual fee. Some do charge a fee, but the rewards may be generous enough to make the card worthwhile.
  • Easily understood terms. Avoid a card with frequently changing cash-back bonuses that you have to keep track of and register for.

Your lifestyle and planned activities

Many retirees look forward to extensive travel. In that’s you, shop for a card with:

  • No foreign-transaction fee. Many cards have a foreign-transaction fee of 2 percent or 3 percent, which will unnecessarily increase the cost of overseas purchases.
  • Generous travel rewards. This might include airline miles and hotel stays, or generous bonus miles as part of an introductory reward when you sign up for the card.

If driving will be your primary mode of transportation — perhaps you’re embarking on a national tour in your RV — look for a card that offers the best perks on gasoline purchases.

Whether you carry a large balance on your current card

A growing number of retirees carry a balance from month to month. That’s not good. You’ll want to retire that debt as quickly as possible. So, look for a card that:

  • Offers a generous balance transfer deal. Some offer as many as 18 months with zero percent interest. Have a plan to pay the balance off before the introductory rate expires.
  • Has zero or a low balance transfer fee. Paying a fee like this can eat into the advantage of making the transfer in the first place.
  • Has a low interest rate after the initial zero percent rate expires. A low rate offers some protection if you slip up and carry a balance again.

For more tips, check out:

Are you managing your credit cards responsibly in retirement? Tell us more in comments below or on our Facebook page.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
7 Kitchen Gadgets That Make Healthy Cooking a Breeze
7 Kitchen Gadgets That Make Healthy Cooking a Breeze

These small appliances and cooking aids make healthy eating easy — and they’re all available on Amazon.

15 Free Streaming Services to Watch While Stuck at Home
15 Free Streaming Services to Watch While Stuck at Home

These free streaming video services offer thousands of movies and TV shows, including recent releases and beloved classics.

Don’t Trash These 11 ‘Disposable’ Items — Reuse Them
Don’t Trash These 11 ‘Disposable’ Items — Reuse Them

Are you throwing away money? Consider giving these things a new purpose.

5 Awesome Places You Can Retire Overseas on $2,000 a Month or Less
5 Awesome Places You Can Retire Overseas on $2,000 a Month or Less

In this week’s podcast: tips on retiring overseas — from someone who’s been helping American expats for decades.

9 Things You Should Never Pay For With a Debit Card
9 Things You Should Never Pay For With a Debit Card

Use your debit card for one of these expenses, and you could risk your bank account balance, your credit score or even identity fraud.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
9 Things You’ll Never See at Costco Again
9 Things You’ll Never See at Costco Again

The warehouse store offers an enormous selection, but these products aren’t coming back.

11 Things Retirees Should Always Buy at Costco
11 Things Retirees Should Always Buy at Costco

This leader in bulk shopping is a great place to find discounts in the fixed-income years.

Over 50? The CDC Says You Need These 4 Vaccines
Over 50? The CDC Says You Need These 4 Vaccines

Fall is the time to schedule vaccines that can keep you healthy — and even save your life.

Why Cloth Masks May Increase Your Coronavirus Risk
Why Cloth Masks May Increase Your Coronavirus Risk

A new study finds that wearing a cloth mask can backfire if you don’t clean it properly.

11 Household Items That Go Bad — or Become Dangerous
11 Household Items That Go Bad — or Become Dangerous

When you get the impulse to stockpile these everyday items, pay close attention to their expiration dates.

8 Things You Can Get for Free at Pharmacies
8 Things You Can Get for Free at Pharmacies

In this age of higher-priced drugs and complex health care systems, a trip to the pharmacy can spark worry. Freebies sure do help.

7 Ways to Boost Your Credit Score Fast
7 Ways to Boost Your Credit Score Fast

Your financial security might soon depend upon the strength of your credit score.

The 15 Worst States for Retirees in 2020
The 15 Worst States for Retirees in 2020

Based on dozens of metrics tied to affordability, quality of life and health care, these are not ideal places to spend retirement.

These Are the 4 Best Medicare Advantage Plans for 2020
These Are the 4 Best Medicare Advantage Plans for 2020

Medicare Advantage customers themselves rate these plans highest.

The 10 Most Commonly Stolen Vehicles in America
The 10 Most Commonly Stolen Vehicles in America

A new model parks atop the list of vehicles that thieves love to pilfer.

This Is the Cheapest Place to Buy a Used Car
This Is the Cheapest Place to Buy a Used Car

Looking for a good deal on a set of wheels? This should be your first stop.

19 High-Paying Jobs You Can Get With a 2-Year Degree
19 High-Paying Jobs You Can Get With a 2-Year Degree

These jobs pay more than the typical job in the U.S. — and no bachelor’s degree is required.

5 Ways to Get Amazon Prime for Free
5 Ways to Get Amazon Prime for Free

Hesitant to drop $119 a year on an Amazon Prime membership? Here’s how to get it for free.

5 Keys to Making Your Car Last for 200,000 Miles
5 Keys to Making Your Car Last for 200,000 Miles

Pushing your car to 200,000 miles — and beyond — can save you piles of cash. Here’s how to get there.

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

26 States That Do Not Tax Social Security Income
26 States That Do Not Tax Social Security Income

These states won’t tax any of your Social Security income — and in some cases, other types of retirement income.

10 Reasons Why You Should Actually Retire at 62
10 Reasons Why You Should Actually Retire at 62

If you can, here are several good reasons to retire earlier than we’re told to.

7 Surprising Features That Boost Your Home Value
7 Surprising Features That Boost Your Home Value

You can add value to your home without hiring a contractor to do expensive renovations.

5 Things That Make Life More Meaningful for Retirees
5 Things That Make Life More Meaningful for Retirees

Retirees agree: These are the things that give them purpose and fulfillment in their golden years.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.