Here’s Why It Could Be a Bad Idea to Upgrade Your Credit Card

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There’s often an important perk missing from those upgrade offers. 

If you like your credit card but want even more perks, you might be thinking about upgrading it. Most credit card companies allow upgrades within the same product line. Many also send out upgrade offers to cardholders from time to time.

What many people don’t realize is that you could miss out on valuable benefits if you upgrade a credit card. Before you request an upgrade with your card issuer, here’s why it could be a bad idea.

There’s no sign-up bonus when you upgrade your credit card

The biggest credit card perk that you normally won’t get when you upgrade is a sign-up bonus. Many credit cards, and almost all of the top rewards credit cards, offer bonuses for new cardholders. If you apply for a card with a sign-up bonus, and you complete the bonus requirements, then you get a nice chunk of cash back, points, or miles.

But if you upgrade your credit card, your new card likely won’t include its standard bonus offer. Let’s say you have an airline credit card, and you’re interested in upgrading it. The airline card you want to upgrade to has a sign-up bonus of 60,000 miles for spending $4,000 in the first three months. That many miles could easily be worth $600 or more in airfare.

By upgrading instead of applying for that card like usual, you’re giving up the opportunity to earn those 60,000 bonus miles.

Sometimes card issuers offer bonuses with credit card upgrades. However, these typically aren’t as much as the sign-up bonuses available to new cardholders.

If you’re considering an upgrade, first check how much that card’s sign-up bonus is compared to any upgrade bonus the card issuer is offering. If you’d get a bigger bonus by applying for the card, then do that instead.

Other introductory offers may not be included, either

In most cases, you don’t get any of a card’s introductory offers when you upgrade to it. Sign-up bonuses are the big one, but if there are other new cardholder offers, keep in mind that you also probably won’t be eligible for those.

For example, if a card has a 0% intro APR, that likely won’t be available. A 0% intro APR can apply to either new purchases or balance transfers. If a card has a 0% intro APR on purchases, you don’t get charged interest on purchases you make for as long as the intro period lasts. If it has a 0% intro APR on balance transfers, you can transfer over debt and pay that debt off with no interest during the intro period.

This may not be as much of an issue. If you always pay your credit card in full and don’t have any debt to worry about, then a 0% intro APR isn’t going to be of much use, anyway. But if you’re interested in a card because of its 0% APR offer, apply for it like normal.

Apply for credit cards with sign-up bonuses instead of upgrading

To be fair, there are advantages to upgrading your credit card. A credit card application has a small impact on your credit score, whereas upgrading doesn’t. You also aren’t adding to your number of credit cards when you upgrade. If you apply for a new card and you’re approved, you’ll have that new card plus the old one to manage.

But those advantages aren’t worth missing out on a lucrative sign-up bonus. If a credit card has a bonus for new cardholders, you’re almost always better off applying for it. The only exception is if there’s an upgrade offer for the same amount as the sign-up bonus, but that doesn’t happen often.

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