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Old 11-25-2015, 01:10 PM   #21
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< taking thread slightly off topic >
The person(s) responsible for coming up with the idea of allowing a purchaser to pay for an item with points earned is on par with the marketing genius (I'm sincere in my choice of the word genius) who added the word "repeat" to the instructions on shampoo bottles.
< returning thread to original topic >
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Old 11-25-2015, 01:36 PM   #22
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That switch sounds like a good idea for someone who doesn't mind the fact that it's a store card, instead of a Visa or Mastercard.
Well, I only use it at Amazon. This segregates our Amazon charges from the other credit cards, and I like that too. We didn't use the original Chase cards anywhere else either, and now they are set aside for emergencies.
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Old 11-25-2015, 04:45 PM   #23
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A few years ago DW got a store credit card at a women's clothing store and at the time she hadn't worked for ~10 years. No issues.

I'm sort-of looking around at different rewards cards and don't anticipate any problems when/if I apply for one.
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Old 11-25-2015, 05:13 PM   #24
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No problem here. We still have income on our tax returns - just not the W2 kind any more. We've been opening cards for the reward points and our FICO scores both went up. I guess because we have more available credit but we don't use it. We just use most of the cards just enough to meet the minimum spend requirements for the sign up bonus points.
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Old 11-25-2015, 05:26 PM   #25
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Thanks all - sounds like another thing to check off my retirement readiness list as "don't worry about it".
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Old 11-25-2015, 06:16 PM   #26
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We've gotten 3 credit cards since retiring. Each time they gave me some smallish credit limit like $3000 and each time I called them and told them to raise it to $15000 or cancel the card. Each time my limit was raised within a few minutes of answering some questions about our income. They really have no way of verifying my income since its mostly taken from our portfolio, but they took my word for it. I assume because our credit is outstanding.
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If they wanted to verify, they would ask for a copy of your 1040.

Has never happened to me.
Interesting. I have a side business doing some reselling for my old company. Every once in a while I get a huge order from them that far outstrips my credit limits on the cards I use for the business. I end up having to max out the cards, get billed, pay them off, max them out again, get billed, pay them off, rinse and repeat multiple times in a month. It's a real PITA and really slows down my ordering process.

I have never been able to get the CC companies to raise my limits high enough (I'd like $50K+ on each of the two cards). Whenever I've tried I've truthfully answered the income questions, which limits me because we don't have that much actual income even though we've got plenty of money. Maybe I'll try answering creatively next time, see if I can get a more useful limit. It's not like I don't always pay the card off each month.
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Old 11-25-2015, 06:46 PM   #27
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I have opened two accounts since retiring. One of the opening available credit amounts was $6000 and the other was $10000. My Amex Cash Preferred card had a $10000 limit for about a year, but they just increased it to $20000 even though the highest balance I ever carried on it was $7000 (had a new roof installed, put it on the card for cash back). Not sure why they even increased it. The last time I looked (about 3 months ago), the total available credit in CCs to me was in the neighborhood of $130K. That is simply crazy. My income has never been very high, but boy, the CC companies sure would like me to finance my soul!!!
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Old 11-25-2015, 06:46 PM   #28
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I'm still out 6 months before I ER at age 55, so I'm trying to foresee what types of things might change in the future. Presently I have no problems qualifying for/getting whatever happens to be the best rewards credit card at any moment in time. I also from time to time take advantage of various sign-up bonus offers (e.g. 50,000t miles, etc.). While I don't see myself going crazy doing "churning" I do see myself continuing to tweak which credit cards I have post retirement - closing some and opening others. Do retired people have issues getting the cards they want with smaller post retirement incomes and no active employer? Admittedly a bit questionable ethics-wise but what stops someone from listing their pre-retirement income and employer? I've never seen how those have been verified for credit card applications, and it would be consistent with the information already established with the credit reporting bureaus.
No problem here. Over 1/2 of my CC's are since we retired 3.5 yrs ago.
Was were also told we didn't have to sell our house to qualify for mortgage on
a new house we were buying. Was real surprised but there was no reason
to ask how they came up with that one.
I never had anyone check my income to see if it was correct.

They count the 401k withdraws as income along with small pension, ss and
rentals.

We do have FICO scores in the 800 + range and was under the impression
that was the major factor in their decisions but not really sure.
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Old 11-25-2015, 07:03 PM   #29
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If they wanted to verify, they would ask for a copy of your 1040.

Has never happened to me.
In my case, this year that wouldn't work since I just retired in January. All they could get is a copy of last years tax return when my wife and I were both working. I doubt they would ever ask for it anyway because if they did I would tell them never mind and get a card from someone else. I'm sure they know that. My guess is that credit score is more important than income unless maybe you're asking for a huge credit limit.
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Old 11-25-2015, 07:05 PM   #30
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Interesting. I have a side business doing some reselling for my old company. Every once in a while I get a huge order from them that far outstrips my credit limits on the cards I use for the business. I end up having to max out the cards, get billed, pay them off, max them out again, get billed, pay them off, rinse and repeat multiple times in a month. It's a real PITA and really slows down my ordering process.

I have never been able to get the CC companies to raise my limits high enough (I'd like $50K+ on each of the two cards). Whenever I've tried I've truthfully answered the income questions, which limits me because we don't have that much actual income even though we've got plenty of money. Maybe I'll try answering creatively next time, see if I can get a more useful limit. It's not like I don't always pay the card off each month.
When they asked for my income I told them I was retired and had no set income. I told them I have XX amount in my portfolio and withdraw whatever I need that month. If your XX amount is big enough I'm sure that will work for you too. They have no idea what a safe withdrawal rate is.
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Old 11-25-2015, 07:39 PM   #31
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When they asked for my income I told them I was retired and had no set income. I told them I have XX amount in my portfolio and withdraw whatever I need that month. If your XX amount is big enough I'm sure that will work for you too. They have no idea what a safe withdrawal rate is.
Your income is what you report to the IRS. It has little to do with your withdrawal rate.
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Old 11-25-2015, 08:07 PM   #32
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I wonder if people even get turned down for credit cards very often these days? Seems like everyone has one.
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Old 11-25-2015, 09:30 PM   #33
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I have never applied for a CC during retirement however I have had my current cards boost my upper limit 10% or so a couple of times. It never motivated me to charge more or not pay off my balance so I'm not too sure if I gained any benefit.
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Old 11-25-2015, 09:37 PM   #34
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Our college age kids get credit card offers almost daily and they've only ever worked part-time and summer jobs. We have been wondering what the CC companies are keying off of to send out so many offers because it sure can't be their current annual income.
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Old 11-25-2015, 10:25 PM   #35
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Your income is what you report to the IRS. It has little to do with your withdrawal rate.
Obviously, but I haven't reported anything to the IRS yet for this year and last year I was still working.

My point was that if I have $1 million, which sounds like a lot of money to a credit card company clerk, and I tell them that my "income" this year is going to be $150,000 they will raise my credit card limit and they have no way of verifying my $150,000 income because I haven't reported anything yet this year. All they have to go on is what I made last year and my statement that I will pay myself $150,000 out of my portfolio this year. They will believe me when I say my income is $150,000 because they dont understand that drawing $150,000 from $1 million is not a good idea.
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Old 11-26-2015, 06:44 AM   #36
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Obviously, but I haven't reported anything to the IRS yet for this year and last year I was still working.

My point was that if I have $1 million, which sounds like a lot of money to a credit card company clerk, and I tell them that my "income" this year is going to be $150,000 they will raise my credit card limit and they have no way of verifying my $150,000 income because I haven't reported anything yet this year. All they have to go on is what I made last year and my statement that I will pay myself $150,000 out of my portfolio this year. They will believe me when I say my income is $150,000 because they dont understand that drawing $150,000 from $1 million is not a good idea.
I actually don't understand why you are concerned that the credit card company doesn't "get it" about what is appropriate for a retiree to spend from their investments. They decided what criteria works for them. If they are mainly going off credit score anyway, stated income must not matter much. If someone asks for what they think is too high a credit limit they can investigate income further if they choose by asking for paycheck stubs, or calling the employer to verify, or other income stubs, or filed tax forms, the latter being maybe a year out of date, but it must not matter in the big scheme of things.

I've been told more than once that loan companies don't like taking savings and investments into account because someone can "run away" with all their liquid assets. But in practice they seem to accept filed tax forms if it comes down to it, and only one cc company ever asked on the application if most of my income came from investments versus salary, pension, etc. Other than preferences for certain sources of income, I wouldn't expect a clerk to understand the bigger picture.

I do notice they are always interested if you own a home, and if so are paying a mortgage, or renting, and the amounts involved.

Obviously, a credit granting company is vulnerable if someone's income or expenses suddenly changes for the worse, but that has always been true - loss of employment, sickness/disability or death in the family, etc., there is always a chance.

But I have never seen questions like "how long have you been retired?", or questions about net worth, or recent changes in employment, or expectations about changes in employment, so in the big scheme it must not matter enough to make a difference.
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Old 11-26-2015, 08:05 AM   #37
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My point was that if I have $1 million, which sounds like a lot of money to a credit card company clerk, and I tell them that my "income" this year is going to be $150,000 they will raise my credit card limit and they have no way of verifying my $150,000 income because I haven't reported anything yet this year. All they have to go on is what I made last year and my statement that I will pay myself $150,000 out of my portfolio this year. They will believe me when I say my income is $150,000 because they don't understand that drawing $150,000 from $1 million is not a good idea.
I ran into this when we applied for a mortgage one year post-retirement. I told them what DH got in SS and I got from a pension ($34K/year total) and added $60K investment income, which is about what we'd drawn out of the investments in the past year. We were pre-approved for $250K- way more than we wanted to borrow. Fine.

Then we found the house we wanted and got down to the record-keeping. They wanted proof of the $60K. I decided that the best way to illustrate our cash flow over the past 12 months, since sometimes large chunks of $$ would go out of the brokerage account and into the checking account, was to prepare a nice Excel exhibit of the balances on our 4 accounts at every month end, and then supply the actual statements. End result: our net worth had gone UP by $100K since I retired because we were spending less than the investment results.

It turned out what they REALLY wanted was to see a nice, neat, regular cash flow from the brokerage to the checking account on a monthly basis. Since that didn't exist (I just called our broker every few months and got checks for 4 months at a time, plus a one-time withdrawal for a big trip), they pretty much ignored our $2 million+ in investments and went with the reliable income: our SS plus pension. They loaned us $100K when we wanted $150K.

I know the discussion was about credit cards but I had to bring up our experience with the mortgage; banks can be very simplistic. With credit cards, though, I think you can still get away with putting down anything you want, and it will get checked only against whatever you reported in earlier applications (that goes on your credit records). The only exception to this of which I'm aware is that Amex has been known to do detailed financial reviews on existing cardholders, but that's never happened to us.
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Old 11-26-2015, 08:10 AM   #38
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We do not see a need to apply for any new credit cards in retirement. We have all the credit cards we will ever need and to apply for a new credit card to get slightly better rewards is not high on our priority list.

Obtaining a mortgage in retirement is something that we are interested in as we may look to downsize our current home in the next couple of years and it will be beneficial to buy the new home before we sell our current residence. We heard of a new rule introduced by Freddie Mac that allows retirement assets to be used to qualify for a mortgage. If I recall correctly a percentage of retirement assets are used for qualification so a $1 million portfolio will provide a additional 24K of annual income. We plan to talk to lenders as we get closer to our potential move.
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Old 11-26-2015, 08:42 AM   #39
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We do not see a need to apply for any new credit cards in retirement. We have all the credit cards we will ever need and to apply for a new credit card to get slightly better rewards is not high on our priority list.

Obtaining a mortgage in retirement is something that we are interested in as we may look to downsize our current home in the next couple of years and it will be beneficial to buy the new home before we sell our current residence. We heard of a new rule introduced by Freddie Mac that allows retirement assets to be used to qualify for a mortgage. If I recall correctly a percentage of retirement assets are used for qualification so a $1 million portfolio will provide a additional 24K of annual income. We plan to talk to lenders as we get closer to our potential move.
That new rule certainly would have helped us.

DH and I don't turn over our credit cards very often, but occasionally a big sign-on bonus will get our attention. We love travel, so hotel and airline points can come in handy. I also had to ask for a credit line increase on our Amex a few months ago; ordinarily we can live with relatively low credit lines since we pay in full, but we were putting a lot of home improvement work on the Amex to get the 2% cash back, so I asked for, and got, a bigger line with no problem.
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Old 11-26-2015, 08:50 AM   #40
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My friend was turned down at Sears when he told them he was retired. He went in another day and said he was a financial advisor (for himself...) and was accepted. It was only to get money back on a fridge purchase.
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