What's Your Credit Card Rewards Strategy?

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SlowMovingInvestor
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Re: What's Your Credit Card Rewards Strategy?

Post by SlowMovingInvestor » Sun May 12, 2019 5:22 am

deskjockey wrote:
Sun May 12, 2019 3:28 am

If you want to squeeze as much value as possible from your Prime Rewards Visa (or Discover card), don't apply the rewards to new purchases, apply them as a credit to your account. If you use them to reduce the cost of an item, you don't earn any cash back on the amount you lower the price by. For example, if you apply $100 cash back to a $300 purchase, you are missing out on $5 that you would have otherwise earned if you had paid full price with the card, then applied the $100 to you account as a credit.
Never thought of this before. Nice !

MikeG62
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Re: What's Your Credit Card Rewards Strategy?

Post by MikeG62 » Sun May 12, 2019 6:13 am

bck63 wrote:
Sat May 11, 2019 10:47 am
Does anyone know when Fidelity posts rewards to your brokerage account for their Visa 2% cash back card? We hit 2500 points during this billing cycle, which ends on 5/17. That should trigger a $50 deposit. Just wondering when it gets deposited, if anyone knows.

Thanks.
My rewards post at the end of the month on a one -month lag. So for charges in the April billing statement, the CB posts at the end of May.
Real Knowledge Comes Only From Experience

bck63
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Re: What's Your Credit Card Rewards Strategy?

Post by bck63 » Sun May 12, 2019 8:25 am

MikeG62 wrote:
Sun May 12, 2019 6:13 am
bck63 wrote:
Sat May 11, 2019 10:47 am
Does anyone know when Fidelity posts rewards to your brokerage account for their Visa 2% cash back card? We hit 2500 points during this billing cycle, which ends on 5/17. That should trigger a $50 deposit. Just wondering when it gets deposited, if anyone knows.

Thanks.
My rewards post at the end of the month on a one -month lag. So for charges in the April billing statement, the CB posts at the end of May.
Thanks Mike.

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Cheez-It Guy
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Re: What's Your Credit Card Rewards Strategy?

Post by Cheez-It Guy » Sun May 12, 2019 9:03 am

SlowMovingInvestor wrote:
Sun May 12, 2019 5:22 am
deskjockey wrote:
Sun May 12, 2019 3:28 am

If you want to squeeze as much value as possible from your Prime Rewards Visa (or Discover card), don't apply the rewards to new purchases, apply them as a credit to your account. If you use them to reduce the cost of an item, you don't earn any cash back on the amount you lower the price by. For example, if you apply $100 cash back to a $300 purchase, you are missing out on $5 that you would have otherwise earned if you had paid full price with the card, then applied the $100 to you account as a credit.
Never thought of this before. Nice !
I would posit that an even better process for cash back redemptions is never to redeem for a statement credit, but always to a high-yielding savings or money market account. This way, you can at least earn some return on the cash back rather than it just sitting on the statement until your due date. The difference is obviously quite small, but why let good be the enemy of best? If planning to redeem for cash, I also try to do it as soon as the rewards post (with statement). No point in letting them accumulate over multiple months unless you plan to use them for travel rewards or something other than cash back.

deskjockey
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Re: What's Your Credit Card Rewards Strategy?

Post by deskjockey » Sun May 12, 2019 9:42 am

Cheez-It Guy wrote:
Sun May 12, 2019 9:03 am

I would posit that an even better process for cash back redemptions is never to redeem for a statement credit, but always to a high-yielding savings or money market account. This way, you can at least earn some return on the cash back rather than it just sitting on the statement until your due date. The difference is obviously quite small, but why let good be the enemy of best? If planning to redeem for cash, I also try to do it as soon as the rewards post (with statement). No point in letting them accumulate over multiple months unless you plan to use them for travel rewards or something other than cash back.
Good catch, but the utility of this strategy depends in part on how and when rewards are posted. If the rewards only post when a statement period closes, then yes, siphoning them off to a high-yield account is the optimal way of maximizing gains, especially now that interest rates are higher than a couple of years ago, since you have a rigid "waiting period" in which the money can earn interest. If, however, rewards post as they are earned (as is the case with Discover, USAA, and Capital One, but possibly others), it becomes both potentially more lucrative and harder to optimize using this tactic. More lucrative because, in theory, you could have as much as a two-month lag between when rewards for a particular purchase post (if, for example, you made the purchase the first day of the statement period) and when the payment for the purchase is due. Harder to do because 1) some cards have a minimum redemption amount, and 2) to maximize the value you'd have to redeem every day that it is possible to do so.

What I do is redeem my rewards every two weeks or so (since most of my cards post rewards as they are earned), or right after a particularly large purchase posts. Most of the time I send the money to a high-yield savings account, but if I redeem a few days before the statement closing date, I'll do it for an account credit.

To give some perspective, however, $25 will only earn you one cent every week at Ally's current 2.2% interest rate, so we're talking chump change, for the most part.

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Cheez-It Guy
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Re: What's Your Credit Card Rewards Strategy?

Post by Cheez-It Guy » Sun May 12, 2019 10:07 am

All good points. Yes, the potential for earnings improvement is quite small. I’m looking at it from my own situation, which is admittedly more limited in scope. I have three credit cards, all from Chase. The statement due dates are all aligned, and rewards post once per month along with the statements. There is no minimum balance to redeem. The payment is due 25 days from statement posting. Therefore, it’s very easy for me to redeem once per month to money market.
Last edited by Cheez-It Guy on Mon May 13, 2019 6:22 am, edited 1 time in total.

gvsucavie03
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Re: What's Your Credit Card Rewards Strategy?

Post by gvsucavie03 » Sun May 12, 2019 10:11 am

Credit card funding for opening a checking account can churn up a lot of rewards. Some banks allow $1,000 or more. Make sure you have your cash advance limit set as low as possible first (preferably zero). I just opened accounts for my wife and I at Citizens Bank for the $600 bonus and scarfed up $40 in rewards with Citi Double Cash.

gvsucavie03
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Re: What's Your Credit Card Rewards Strategy?

Post by gvsucavie03 » Sun May 12, 2019 10:21 am

gvsucavie03 wrote:
Sun May 12, 2019 10:11 am
Credit card funding for opening a checking account can churn up a lot of rewards. Some banks allow $1,000 or more. Make sure you have your cash advance limit set as low as possible first (preferably zero). I just opened accounts for my wife and I at Citizens Bank for the $600 bonus and scarfed up $40 in rewards with Citi Double Cash.
PNC was (R.I.P.) $2,000 cc funding, but that seems to be no more....

Pepper11
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Re: What's Your Credit Card Rewards Strategy?

Post by Pepper11 » Sun May 12, 2019 8:56 pm

My updated my CC rewards strategy:

Amex Blue Cash Preferred: 6% Grocery, 6% Streaming
Ducks Unlimited: 5% Gas & Sporting Goods
Uber: 4% Restaurants, 3% Travel, $50 yearly streaming voucher
Double Cash: 2% everything else

Lots of good cards out there these days.

IowaFarmWife
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Re: What's Your Credit Card Rewards Strategy?

Post by IowaFarmWife » Sun May 12, 2019 9:16 pm

bck63 wrote:
Sat May 11, 2019 10:47 am
Does anyone know when Fidelity posts rewards to your brokerage account for their Visa 2% cash back card? We hit 2500 points during this billing cycle, which ends on 5/17. That should trigger a $50 deposit. Just wondering when it gets deposited, if anyone knows.

Thanks.

It usually takes a few days for the points to show up in the rewards page after the statement closing. It also takes a few days for the rewards to post to you cash management account. I have learned to just be patient and everything always shows up where it is supposed to be in a few days. I love this 2% card, but no one is in a hurry to post points, payments, etc. I think it is because it is run by a third party Elan.

bck63
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Re: What's Your Credit Card Rewards Strategy?

Post by bck63 » Mon May 13, 2019 3:25 am

IowaFarmWife wrote:
Sun May 12, 2019 9:16 pm
bck63 wrote:
Sat May 11, 2019 10:47 am
Does anyone know when Fidelity posts rewards to your brokerage account for their Visa 2% cash back card? We hit 2500 points during this billing cycle, which ends on 5/17. That should trigger a $50 deposit. Just wondering when it gets deposited, if anyone knows.

Thanks.
It usually takes a few days for the points to show up in the rewards page after the statement closing. It also takes a few days for the rewards to post to you cash management account. I have learned to just be patient and everything always shows up where it is supposed to be in a few days. I love this 2% card, but no one is in a hurry to post points, payments, etc. I think it is because it is run by a third party Elan.
Thank you.

Bob Sacamano
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Re: What's Your Credit Card Rewards Strategy?

Post by Bob Sacamano » Mon May 13, 2019 12:44 pm

hey all, could use some advice. wife and i have been hoarding our Chase Ultimate Rewards points and as such we have about 550-600,000 between the two of us.

issue is, i don't think we have any time for any large trips in the near future and we're worried about point devaluation and such.

i'd love to go to Japan or Spain or Portgual or something but the only trip we have planned is Seattle for a few nights. we are also working on getting pregnant with our first child - another wrench in the travel situation.

any thoughts or insight?

international001
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Re: What's Your Credit Card Rewards Strategy?

Post by international001 » Mon May 13, 2019 1:25 pm

Yukon wrote:
Fri May 10, 2019 1:17 pm
international001 wrote:
Fri May 10, 2019 12:25 pm
I can find better deals with European discount travel agencies than booking directly via airlines, so all those travel perks have become moot to me
Which agencies?
I have found deals in places like https://www.cheaptickets.com/ in the past
Another trick, try to go to the european version of the website. It's often cheaper

MichCPA
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Re: What's Your Credit Card Rewards Strategy?

Post by MichCPA » Mon May 13, 2019 2:01 pm

Bob Sacamano wrote:
Mon May 13, 2019 12:44 pm
hey all, could use some advice. wife and i have been hoarding our Chase Ultimate Rewards points and as such we have about 550-600,000 between the two of us.

issue is, i don't think we have any time for any large trips in the near future and we're worried about point devaluation and such.

i'd love to go to Japan or Spain or Portgual or something but the only trip we have planned is Seattle for a few nights. we are also working on getting pregnant with our first child - another wrench in the travel situation.

any thoughts or insight?
If you aren't taking any longer trips, you might consider using the UR points for short weekend trips with stays at Hyatt. If you aren't looking at international flights, they have the best redemption value.

lkar
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Re: What's Your Credit Card Rewards Strategy?

Post by lkar » Mon May 13, 2019 6:00 pm

Bob Sacamano wrote:
Mon May 13, 2019 12:44 pm
hey all, could use some advice. wife and i have been hoarding our Chase Ultimate Rewards points and as such we have about 550-600,000 between the two of us.

issue is, i don't think we have any time for any large trips in the near future and we're worried about point devaluation and such.

i'd love to go to Japan or Spain or Portgual or something but the only trip we have planned is Seattle for a few nights. we are also working on getting pregnant with our first child - another wrench in the travel situation.

any thoughts or insight?
The good news about that having them in Chase is the flexibility. Even if one of their transfer partners devalues -- like United -- they are not likely all to devalue at the same time. You still have Hyatt. Etc. The big concern would be if they move from redemption at 1.25 cents when booking through their website (or 1.5 cents if you have the Reserve). But I think that's unlikely and even then you can still get pretty good value in a cash based redemption program like Southwest if you fly domestically.

Bottom line, I wouldn't do anything rash and I would just tend to use them as the need arises. In terms of continued accumulation of rewards, though, you might have a sufficient balance that at this point it might make sense to diversify and maybe move to a credit card that accumulates cashback or Amex or some other currency.

gvsucavie03
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Re: What's Your Credit Card Rewards Strategy?

Post by gvsucavie03 » Mon May 13, 2019 6:20 pm

Bob Sacamano wrote:
Mon May 13, 2019 12:44 pm
hey all, could use some advice. wife and i have been hoarding our Chase Ultimate Rewards points and as such we have about 550-600,000 between the two of us.

issue is, i don't think we have any time for any large trips in the near future and we're worried about point devaluation and such.

i'd love to go to Japan or Spain or Portgual or something but the only trip we have planned is Seattle for a few nights. we are also working on getting pregnant with our first child - another wrench in the travel situation.

any thoughts or insight?
You could always take the cash at 1x redemption if you truly feel you won't be able to use them (they don't expire as long as the cards are open, btw).

Bob Sacamano
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Re: What's Your Credit Card Rewards Strategy?

Post by Bob Sacamano » Tue May 14, 2019 12:15 pm

gvsucavie03 wrote:
Mon May 13, 2019 6:20 pm
Bob Sacamano wrote:
Mon May 13, 2019 12:44 pm
hey all, could use some advice. wife and i have been hoarding our Chase Ultimate Rewards points and as such we have about 550-600,000 between the two of us.

issue is, i don't think we have any time for any large trips in the near future and we're worried about point devaluation and such.

i'd love to go to Japan or Spain or Portgual or something but the only trip we have planned is Seattle for a few nights. we are also working on getting pregnant with our first child - another wrench in the travel situation.

any thoughts or insight?
You could always take the cash at 1x redemption if you truly feel you won't be able to use them (they don't expire as long as the cards are open, btw).
sorry - are you saying the cash redemption will always be 1x?

e5116
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Re: What's Your Credit Card Rewards Strategy?

Post by e5116 » Tue May 14, 2019 2:00 pm

Bob Sacamano wrote:
Mon May 13, 2019 12:44 pm
hey all, could use some advice. wife and i have been hoarding our Chase Ultimate Rewards points and as such we have about 550-600,000 between the two of us.

issue is, i don't think we have any time for any large trips in the near future and we're worried about point devaluation and such.

i'd love to go to Japan or Spain or Portgual or something but the only trip we have planned is Seattle for a few nights. we are also working on getting pregnant with our first child - another wrench in the travel situation.

any thoughts or insight?
I wouldn't use it just to use it, if you wouldn't have done so otherwise. I'm in the same boat having >600,000 Chase UR on top of 300,000 United miles, but am not concerned. With two children, the points will go fast on flights, hotels, etc. I just use it as I incur travel costs, looking at the optimal way to pay. The only debate I sometimes have is cash vs. going through the portal, so I've been going through the portal more frequently just to use them and not have to pay anything out of pocket.

batpot
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Re: What's Your Credit Card Rewards Strategy?

Post by batpot » Tue May 14, 2019 2:49 pm

Pepper11 wrote:
Sun May 12, 2019 8:56 pm
Uber: $50 yearly streaming voucher
How does that voucher work?
Is it like a statement credit once a year, provided you used the card for at least $50 worth of streaming services?

I'm surprised there's not more talk about Alliant.
3% first year, then 2.5% thereafter, with a $99 annual fee, waived the first year.
Currently using it for the very expensive daycare bill every month, using Plastique...and everything else.
Even at 2.5%, it's worth it to keep doing that and milking the rewards.

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ResearchMed
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Re: What's Your Credit Card Rewards Strategy?

Post by ResearchMed » Tue May 14, 2019 2:52 pm

e5116 wrote:
Tue May 14, 2019 2:00 pm
Bob Sacamano wrote:
Mon May 13, 2019 12:44 pm
hey all, could use some advice. wife and i have been hoarding our Chase Ultimate Rewards points and as such we have about 550-600,000 between the two of us.

issue is, i don't think we have any time for any large trips in the near future and we're worried about point devaluation and such.

i'd love to go to Japan or Spain or Portgual or something but the only trip we have planned is Seattle for a few nights. we are also working on getting pregnant with our first child - another wrench in the travel situation.

any thoughts or insight?
I wouldn't use it just to use it, if you wouldn't have done so otherwise. I'm in the same boat having >600,000 Chase UR on top of 300,000 United miles, but am not concerned. With two children, the points will go fast on flights, hotels, etc. I just use it as I incur travel costs, looking at the optimal way to pay. The only debate I sometimes have is cash vs. going through the portal, so I've been going through the portal more frequently just to use them and not have to pay anything out of pocket.
We hoarded AAdvantage points and also Amex MR points for a very long time. So many times, we were "warned" that the points would be devalued, and of course, they were, but only in a few relatively small steps.

And then, relatively recently, we've had the time/inclination to start doing some of that "serious travel" that we'd put off for far too long.

And we've dug into those nice balances, by going on JL (Japan Airlines) and CX (Cathay Pacific - amazing!) First class, and had The Most Amazing [and l-o-n-g!] flights ever. And then some other trips, both land trips and cruises.

At our ages, we would indeed have paid for J (business class) IF we had to pay... either that, or we wouldn't be able to go. Our aging bodies, albeit in reasonably good condition, just can't handle sitting up in narrow, uncomfortable seats for very long periods of time. But lying down? Sleeping? So different!

It's very much as if we had saved up money for a trip, and the money had lost a bit to inflation... but there was still enough for the trips desired, etc.

It would have been *such* a mistake to have redeemed the points for relatively low value cash, in terms of "money per point". And now, we have what is very much like a big vacation savings account, for any of the international travel needed.

It was definitely the right decision for us to hoard, just like others save money for travel.

As for hotels through awards portals, double check that the price equivalent is right for you. Those sometimes have inflated prices/values, compared with paying regular cash.
The trick is to be able to get the "best value" for the points for what YOU want, how YOU want to travel.
What others prefer? Not relevant other than perhaps as suggestions to consider.

RM
This signature is a placebo. You are in the control group.

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VictoriaF
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Re: What's Your Credit Card Rewards Strategy?

Post by VictoriaF » Tue May 14, 2019 2:55 pm

Bob Sacamano wrote:
Mon May 13, 2019 12:44 pm
hey all, could use some advice. wife and i have been hoarding our Chase Ultimate Rewards points and as such we have about 550-600,000 between the two of us.

issue is, i don't think we have any time for any large trips in the near future and we're worried about point devaluation and such.
Perhaps, you can use your points to gift travel to your children, parents, or other relatives?

Victoria
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Pu239
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Re: What's Your Credit Card Rewards Strategy?

Post by Pu239 » Tue May 14, 2019 4:15 pm

batpot wrote:
Tue May 14, 2019 2:49 pm
Even at 2.5%, it's worth it to keep doing that and milking the rewards.
At 2.5% and with a $99 annual fee, you'd have to spend almost $20,000/yr to break even with a 2% no annual fee card. I have the Alliant card and will be downgrading vg to their 2% no AF version after finding other higher % cards for groceries, travel, gas, etc. It's been a great card for general spending but with other cards paying sign-up bonuses, I can't see using it more than $20k/yr.

batpot
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Re: What's Your Credit Card Rewards Strategy?

Post by batpot » Tue May 14, 2019 4:43 pm

Pu239 wrote:
Tue May 14, 2019 4:15 pm
batpot wrote:
Tue May 14, 2019 2:49 pm
Even at 2.5%, it's worth it to keep doing that and milking the rewards.
At 2.5% and with a $99 annual fee, you'd have to spend almost $20,000/yr to break even with a 2% no annual fee card. I have the Alliant card and will be downgrading vg to their 2% no AF version after finding other higher % cards for groceries, travel, gas, etc. It's been a great card for general spending but with other cards paying sign-up bonuses, I can't see using it more than $20k/yr.
Yup, easily done.
Especially when you factor in earning 2.5% on plastique's 2.5% charge, and floating the child care payment a month.

Alternatively, we can cancel, and have the other spouse sign up; rinse, repeat, every year.

gvsucavie03
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Re: What's Your Credit Card Rewards Strategy?

Post by gvsucavie03 » Tue May 14, 2019 7:20 pm

Bob Sacamano wrote:
Tue May 14, 2019 12:15 pm
gvsucavie03 wrote:
Mon May 13, 2019 6:20 pm
Bob Sacamano wrote:
Mon May 13, 2019 12:44 pm
hey all, could use some advice. wife and i have been hoarding our Chase Ultimate Rewards points and as such we have about 550-600,000 between the two of us.

issue is, i don't think we have any time for any large trips in the near future and we're worried about point devaluation and such.

i'd love to go to Japan or Spain or Portgual or something but the only trip we have planned is Seattle for a few nights. we are also working on getting pregnant with our first child - another wrench in the travel situation.

any thoughts or insight?
You could always take the cash at 1x redemption if you truly feel you won't be able to use them (they don't expire as long as the cards are open, btw).
sorry - are you saying the cash redemption will always be 1x?
Cash redemption would be $5,500-6,000

mrsbetsy
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Re: What's Your Credit Card Rewards Strategy?

Post by mrsbetsy » Tue May 14, 2019 9:19 pm

Bob Sacamano wrote:
Mon May 13, 2019 12:44 pm
hey all, could use some advice. wife and i have been hoarding our Chase Ultimate Rewards points and as such we have about 550-600,000 between the two of us.

issue is, i don't think we have any time for any large trips in the near future and we're worried about point devaluation and such.

i'd love to go to Japan or Spain or Portgual or something but the only trip we have planned is Seattle for a few nights. we are also working on getting pregnant with our first child - another wrench in the travel situation.

any thoughts or insight?
We accumulate a ton of points because we are business owners. We use Chase UR points by using the "Things to do" button on the Chase portal. I know many would argue that it isn't a great redemption value, but we always have more than we can possibly use. There are many options available for Seattle including Beer Crawls, massages, dining, Food and Culture tours, all the museums, Mt. Rainier tour, etc. etc.

We tend to churn and burn. Just spent 10 days in Italy and spent about $300 out of pocket, which was mostly tips and street food. We used points for the Colosseum, private tour guides, hotels, and much more.

Pepper11
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Re: What's Your Credit Card Rewards Strategy?

Post by Pepper11 » Tue May 14, 2019 9:39 pm

batpot wrote:
Tue May 14, 2019 2:49 pm
Pepper11 wrote:
Sun May 12, 2019 8:56 pm
Uber: $50 yearly streaming voucher
How does that voucher work?
Is it like a statement credit once a year, provided you used the card for at least $50 worth of streaming services?
Uber card just about my favorite card ever. I have it set for autopay on Netflix and it just credits me the 12.99 or whatever until it hits $50. Have to spend $3000 a year to get the benefit fwiw.

TravelGeek
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Re: What's Your Credit Card Rewards Strategy?

Post by TravelGeek » Tue May 14, 2019 9:57 pm

mrsbetsy wrote:
Tue May 14, 2019 9:19 pm
We accumulate a ton of points because we are business owners. We use Chase UR points by using the "Things to do" button on the Chase portal. I know many would argue that it isn't a great redemption value, but we always have more than we can possibly use. There are many options available for Seattle including Beer Crawls, massages, dining, Food and Culture tours, all the museums, Mt. Rainier tour, etc. etc.
I have never looked at that option, but I would suggest doing the math of collecting 2% cashback and using that to buy those same “things to do” (assuming similar things are available for cash).

Pu239
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Re: What's Your Credit Card Rewards Strategy?

Post by Pu239 » Tue May 14, 2019 10:03 pm

batpot wrote:
Tue May 14, 2019 4:43 pm
Yup, easily done.
Especially when you factor in earning 2.5% on plastique's 2.5% charge, and floating the child care payment a month.

Alternatively, we can cancel, and have the other spouse sign up; rinse, repeat, every year.
Ah, the good old days of paying for daycare. I assume they don't take cc's directly. That's one expense I'll never miss.

confusedinvestor
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Re: What's Your Credit Card Rewards Strategy?

Post by confusedinvestor » Wed May 15, 2019 2:02 am

Stream all day with a $50 statement credit – Up to a $50 statement credit for online subscription services after you spend $5,000 or more on your card per year.²
Pepper11 wrote:
Tue May 14, 2019 9:39 pm


Uber card just about my favorite card ever. I have it set for autopay on Netflix and it just credits me the 12.99 or whatever until it hits $50. Have to spend $3000 a year to get the benefit fwiw.

Yukon
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Re: What's Your Credit Card Rewards Strategy?

Post by Yukon » Wed May 15, 2019 5:21 am

mrsbetsy wrote:
Tue May 14, 2019 9:19 pm
We accumulate a ton of points because we are business owners. We use Chase UR points by using the "Things to do" button on the Chase portal. I know many would argue that it isn't a great redemption value, but we always have more than we can possibly use. There are many options available for Seattle including Beer Crawls, massages, dining, Food and Culture tours, all the museums, Mt. Rainier tour, etc. etc.

We tend to churn and burn. Just spent 10 days in Italy and spent about $300 out of pocket, which was mostly tips and street food. We used points for the Colosseum, private tour guides, hotels, and much more.
Does your tax accountant suggest these "things to do" are taxable to you as the owner?
Don't Work Forever.

Yukon
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Re: What's Your Credit Card Rewards Strategy?

Post by Yukon » Wed May 15, 2019 5:25 am

TravelGeek wrote:
Tue May 14, 2019 9:57 pm
mrsbetsy wrote:
Tue May 14, 2019 9:19 pm
We accumulate a ton of points because we are business owners. We use Chase UR points by using the "Things to do" button on the Chase portal. I know many would argue that it isn't a great redemption value, but we always have more than we can possibly use. There are many options available for Seattle including Beer Crawls, massages, dining, Food and Culture tours, all the museums, Mt. Rainier tour, etc. etc.
I have never looked at that option, but I would suggest doing the math of collecting 2% cashback and using that to buy those same “things to do” (assuming similar things are available for cash).
Great point. I also think people forget to compensate for the income tax paid on using cash. (A $100 museum ticket out of pocket might entail $150 of income less taxes.)
Don't Work Forever.

JackoC
Posts: 639
Joined: Sun Aug 12, 2018 11:14 am

Re: What's Your Credit Card Rewards Strategy?

Post by JackoC » Wed May 15, 2019 9:20 am

Pu239 wrote:
Tue May 14, 2019 4:15 pm
batpot wrote:
Tue May 14, 2019 2:49 pm
Even at 2.5%, it's worth it to keep doing that and milking the rewards.
At 2.5% and with a $99 annual fee, you'd have to spend almost $20,000/yr to break even with a 2% no annual fee card. I have the Alliant card and will be downgrading vg to their 2% no AF version after finding other higher % cards for groceries, travel, gas, etc. It's been a great card for general spending but with other cards paying sign-up bonuses, I can't see using it more than $20k/yr.
The economics of higher % with AF v lower % w/o AF obviously depend how much you use the card. We just got BOA/Merrill Preferred Rewards card at 2.625% (3.5% dining), as soon as we reach 'Platinum' level of 90 day average balance which should be by June 1, nominal* $95 AF. It will make us semi-retire our current main card, Citi Double Cash 2%, no AF. We spend several times $20k/yr on our main card even now. And with cashback north of 2% you can come out ahead using CC for stuff which charges a convenience fee. For example the cheapest providers to pay federal tax by CC charge 1.87%, so 2.625% opens up a worthwhile new revenue stream for us by paying federal taxes, we pay virtually all estimated almost no withholding, at 2.625% CB which is only marginal at 2% CB**. Our state taxes can only be paid at 2% CF but we might also do that now that it's 2.625% CB. Property tax CF where we live is 2.95% so that's still a loser.

Our strategy once we get the BOA/M PR card going, at Platinum level June 1, will be:
BOA Cash Rewards, 5.25% selected category (groceries, we usually spend less than $2.5k/qtr limit), 3.5% Costco
BOA Preferred Rewards, 3.5% dining/travel, 2.625% everything else
Chase Freedom, possible use of 5% rotating categories $1,500/qtr, especially when it's Costco, just buy a $1,500 Costco Cash Card
Target Debit at Target, 5%
Citi Double, Amex Blue Cash and Capital One Quicksilver will all go dormant, small charge or two per year to keep them from closing. Amex is our oldest account of any kind (I used to, not so wisely, close old CC accounts so we have one missed payment on anything in the last 35 years, now out of the window of consideration, but Amex is only around 15 yrs old, no mortgage in the last 20+ yrs, so our credit score is not quite stellar).

Other posts here about churning for card opening bonuses are interesting, I should probably look into it, but for ongoing purchases I'd rather keep it simple. Wife does not really like day to day card use to be even as complicated as the above, though goes along with it.

*another recent thread discussed whether you could get BOA/M to waive this, at least the first time, also you can offset it with up to $100 credit on airline incidentals, but let's assume it's just paid, particularly since in our case I dislike flying and we don't necessarily fly in any given year.
**breaks even where (1+CF)*(1-CB)=1, so 1.84% CB for a 1.87% CF, rather than exactly where CF=CB

mrsbetsy
Posts: 169
Joined: Mon Jun 26, 2017 12:16 am

Re: What's Your Credit Card Rewards Strategy?

Post by mrsbetsy » Wed May 15, 2019 11:43 am

Yukon wrote:
Wed May 15, 2019 5:21 am
mrsbetsy wrote:
Tue May 14, 2019 9:19 pm
We accumulate a ton of points because we are business owners. We use Chase UR points by using the "Things to do" button on the Chase portal. I know many would argue that it isn't a great redemption value, but we always have more than we can possibly use. There are many options available for Seattle including Beer Crawls, massages, dining, Food and Culture tours, all the museums, Mt. Rainier tour, etc. etc.

We tend to churn and burn. Just spent 10 days in Italy and spent about $300 out of pocket, which was mostly tips and street food. We used points for the Colosseum, private tour guides, hotels, and much more.
Does your tax accountant suggest these "things to do" are taxable to you as the owner?
Actually, it was his suggestion and no, they are not taxable to me as the owner.

It's never generated a 1099-MISC

There is a difference between funds paid when opening up a checking account and getting money versus reward points, which are often viewed as rebates.

We've been audited multiple times over the years and we've always come out squeaky clean.

mrsbetsy
Posts: 169
Joined: Mon Jun 26, 2017 12:16 am

Re: What's Your Credit Card Rewards Strategy?

Post by mrsbetsy » Wed May 15, 2019 11:44 am

TravelGeek wrote:
Tue May 14, 2019 9:57 pm
mrsbetsy wrote:
Tue May 14, 2019 9:19 pm
We accumulate a ton of points because we are business owners. We use Chase UR points by using the "Things to do" button on the Chase portal. I know many would argue that it isn't a great redemption value, but we always have more than we can possibly use. There are many options available for Seattle including Beer Crawls, massages, dining, Food and Culture tours, all the museums, Mt. Rainier tour, etc. etc.
I have never looked at that option, but I would suggest doing the math of collecting 2% cashback and using that to buy those same “things to do” (assuming similar things are available for cash).
Just like using points for hotels or airlines, it's good to compare across the sites. We've never done the cash back option and likely never will. Keep checking and there are discounts to be had for sure!

jrbdmb
Posts: 341
Joined: Tue Oct 06, 2015 4:27 pm

Re: What's Your Credit Card Rewards Strategy?

Post by jrbdmb » Wed May 15, 2019 12:39 pm

SlowMovingInvestor wrote:
Fri May 03, 2019 5:01 pm
atdharris wrote:
Fri May 03, 2019 9:34 am

It is possible to beat cash back with points, but it takes a lot of research and work, and sometimes I just don't want to put the effort into it. Getting minimum of 2.7 points per dollar is not a bad earnings rate. You could do much worse.
I agree that 2.7% back is pretty good. But If you're doing international biz class travel, you can definitely do better with points.
Yes, but only if you think Biz Class is a required minimum for international flights. Sure it's nice, but personally I wouldn't pay much more than a 10% premium over Coach, whether in cash or in points. (YMMV)

Yukon
Posts: 227
Joined: Wed Jan 23, 2008 8:10 am

Re: What's Your Credit Card Rewards Strategy?

Post by Yukon » Wed May 15, 2019 12:55 pm

mrsbetsy wrote:
Wed May 15, 2019 11:43 am
Actually, it was his suggestion and no, they are not taxable to me as the owner.

It's never generated a 1099-MISC

There is a difference between funds paid when opening up a checking account and getting money versus reward points, which are often viewed as rebates.

We've been audited multiple times over the years and we've always come out squeaky clean.
Thanks. Good to know.
Don't Work Forever.

confusedinvestor
Posts: 541
Joined: Thu Mar 15, 2012 11:04 am

Re: What's Your Credit Card Rewards Strategy?

Post by confusedinvestor » Wed May 15, 2019 8:53 pm

Just got approved for Fidelity 2% cashback credit card with 18 Month 0 APR promo with 25K credit

I am doing some remodel so I am spending some $$$

What do you think of using this Fidelity Card for my remodel purchases and do minimum payment and get this 0 APR for 18 months and invest the money in Vanguard MMM yielding 2.5% ?

Any downsides ? or Catches by Fidelity with this promo ?

TravelGeek
Posts: 2967
Joined: Sat Oct 25, 2014 3:23 pm

Re: What's Your Credit Card Rewards Strategy?

Post by TravelGeek » Wed May 15, 2019 9:05 pm

mrsbetsy wrote:
Wed May 15, 2019 11:44 am
TravelGeek wrote:
Tue May 14, 2019 9:57 pm
mrsbetsy wrote:
Tue May 14, 2019 9:19 pm
We accumulate a ton of points because we are business owners. We use Chase UR points by using the "Things to do" button on the Chase portal. I know many would argue that it isn't a great redemption value, but we always have more than we can possibly use. There are many options available for Seattle including Beer Crawls, massages, dining, Food and Culture tours, all the museums, Mt. Rainier tour, etc. etc.
I have never looked at that option, but I would suggest doing the math of collecting 2% cashback and using that to buy those same “things to do” (assuming similar things are available for cash).
Just like using points for hotels or airlines, it's good to compare across the sites. We've never done the cash back option and likely never will. Keep checking and there are discounts to be had for sure!

Looking at some of the “Experiences” in the Chase app, they seem to value the UR points at exactly one penny per point. Not sure if that is the same as the “Things to do” redemption or how many points you earn on average per dollar spend, but I tend to get a higher value for my URs. Higher values tend to require transfers to other loyalty programs or travel purchases.

IowaFarmWife
Posts: 117
Joined: Thu Nov 02, 2017 9:42 pm

Re: What's Your Credit Card Rewards Strategy?

Post by IowaFarmWife » Wed May 15, 2019 9:31 pm

confusedinvestor wrote:
Wed May 15, 2019 8:53 pm
Just got approved for Fidelity 2% cashback credit card with 18 Month 0 APR promo with 25K credit

I am doing some remodel so I am spending some $$$

What do you think of using this Fidelity Card for my remodel purchases and do minimum payment and get this 0 APR for 18 months and invest the money in Vanguard MMM yielding 2.5% ?

Any downsides ? or Catches by Fidelity with this promo ?
I think that is fine, just read the fine print on the fidelity card to make sure there are no "gotcha" clauses and keep up with the minimum payments obviously.

gvsucavie03
Posts: 1394
Joined: Sat Feb 16, 2013 8:30 am

Re: What's Your Credit Card Rewards Strategy?

Post by gvsucavie03 » Thu May 16, 2019 5:42 am

IowaFarmWife wrote:
Wed May 15, 2019 9:31 pm
confusedinvestor wrote:
Wed May 15, 2019 8:53 pm
Just got approved for Fidelity 2% cashback credit card with 18 Month 0 APR promo with 25K credit

I am doing some remodel so I am spending some $$$

What do you think of using this Fidelity Card for my remodel purchases and do minimum payment and get this 0 APR for 18 months and invest the money in Vanguard MMM yielding 2.5% ?

Any downsides ? or Catches by Fidelity with this promo ?
I think that is fine, just read the fine print on the fidelity card to make sure there are no "gotcha" clauses and keep up with the minimum payments obviously.
Do your homework as there is a considerable amount of risk involved.

LawProf
Posts: 23
Joined: Sun Feb 03, 2013 12:32 am

Re: What's Your Credit Card Rewards Strategy?

Post by LawProf » Thu May 16, 2019 7:34 am

For turning credit card rewards into investment funds, you can use the Amex Blue Business to get 2% back on everything and combine that with a Charles Schwab Amex Platinum that allows to move your Membership Rewards points to Schwab at a rate of 1.25% per point. If enough points are at stake, that would be a better deal that Fidelity's 2%, even with the Platinum's fees.

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ResearchMed
Posts: 8633
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Re: What's Your Credit Card Rewards Strategy?

Post by ResearchMed » Thu May 16, 2019 8:23 am

LawProf wrote:
Thu May 16, 2019 7:34 am
For turning credit card rewards into investment funds, you can use the Amex Blue Business to get 2% back on everything and combine that with a Charles Schwab Amex Platinum that allows to move your Membership Rewards points to Schwab at a rate of 1.25% per point. If enough points are at stake, that would be a better deal that Fidelity's 2%, even with the Platinum's fees.
Is this for any Amex Plat (e.g., not branded)?

DH already has a relatively small amount at Schwab, but could move his mother's trust there (a small trust account is already there for convenience); we will move much of his 403b money there when he retires, which isn't all that far away these days. There are a few smaller accounts that could be moved there.

We have a lot of MR points, though we used to have far more :wink:

RM
This signature is a placebo. You are in the control group.

Jags4186
Posts: 3244
Joined: Wed Jun 18, 2014 7:12 pm

Re: What's Your Credit Card Rewards Strategy?

Post by Jags4186 » Thu May 16, 2019 8:44 am

ResearchMed wrote:
Thu May 16, 2019 8:23 am
LawProf wrote:
Thu May 16, 2019 7:34 am
For turning credit card rewards into investment funds, you can use the Amex Blue Business to get 2% back on everything and combine that with a Charles Schwab Amex Platinum that allows to move your Membership Rewards points to Schwab at a rate of 1.25% per point. If enough points are at stake, that would be a better deal that Fidelity's 2%, even with the Platinum's fees.
Is this for any Amex Plat (e.g., not branded)?

DH already has a relatively small amount at Schwab, but could move his mother's trust there (a small trust account is already there for convenience); we will move much of his 403b money there when he retires, which isn't all that far away these days. There are a few smaller accounts that could be moved there.

We have a lot of MR points, though we used to have far more :wink:

RM
You need the Schwab Platinum to cash out MR at 1.25¢ each. Keep in mind the Schwab Platinum comes with a $550 annual fee and a 60,000 point bonus so you’ll need to hit that minimum spend for it to make sense to go this route (or find $550 value in AMEX Platinum).

User avatar
ResearchMed
Posts: 8633
Joined: Fri Dec 26, 2008 11:25 pm

Re: What's Your Credit Card Rewards Strategy?

Post by ResearchMed » Thu May 16, 2019 9:03 am

Jags4186 wrote:
Thu May 16, 2019 8:44 am
ResearchMed wrote:
Thu May 16, 2019 8:23 am
LawProf wrote:
Thu May 16, 2019 7:34 am
For turning credit card rewards into investment funds, you can use the Amex Blue Business to get 2% back on everything and combine that with a Charles Schwab Amex Platinum that allows to move your Membership Rewards points to Schwab at a rate of 1.25% per point. If enough points are at stake, that would be a better deal that Fidelity's 2%, even with the Platinum's fees.
Is this for any Amex Plat (e.g., not branded)?

DH already has a relatively small amount at Schwab, but could move his mother's trust there (a small trust account is already there for convenience); we will move much of his 403b money there when he retires, which isn't all that far away these days. There are a few smaller accounts that could be moved there.

We have a lot of MR points, though we used to have far more :wink:

RM
You need the Schwab Platinum to cash out MR at 1.25¢ each. Keep in mind the Schwab Platinum comes with a $550 annual fee and a 60,000 point bonus so you’ll need to hit that minimum spend for it to make sense to go this route (or find $550 value in AMEX Platinum).
Ah... I thought the "to Schwab at a rate of 1.25% per point" meant an increase in the number of points.

We definitely get more value when we use the points for premium international air travel, so... no to "points into cash".

Thanks.

RM
This signature is a placebo. You are in the control group.

Caduceus
Posts: 1861
Joined: Mon Sep 17, 2012 1:47 am

Re: What's Your Credit Card Rewards Strategy?

Post by Caduceus » Thu May 16, 2019 1:39 pm

I made a lot of money in the last 12 months from credit cards, but I am still deciding whether to try it again. I took out a 0% balance transfer + 0% fee offer (direct deposit to bank account) of about $20,000 and invested in a stock I researched. It went up 33.2% and I sold the position and repaid the balance transfer. I could have continued rolling over the transfer at a fee of 3%, but the position isn't as undervalued as it was (margin of safety maybe only another 20% or so), so I sold it.

I do own that position outright with un-levered money, so it was something I had been invested in all along but the credit cards allowed me to front-load the purchases before my income came in.

mrsbetsy
Posts: 169
Joined: Mon Jun 26, 2017 12:16 am

Re: What's Your Credit Card Rewards Strategy?

Post by mrsbetsy » Thu May 16, 2019 3:37 pm

TravelGeek wrote:
Wed May 15, 2019 9:05 pm
mrsbetsy wrote:
Wed May 15, 2019 11:44 am
TravelGeek wrote:
Tue May 14, 2019 9:57 pm
mrsbetsy wrote:
Tue May 14, 2019 9:19 pm
We accumulate a ton of points because we are business owners. We use Chase UR points by using the "Things to do" button on the Chase portal. I know many would argue that it isn't a great redemption value, but we always have more than we can possibly use. There are many options available for Seattle including Beer Crawls, massages, dining, Food and Culture tours, all the museums, Mt. Rainier tour, etc. etc.
I have never looked at that option, but I would suggest doing the math of collecting 2% cashback and using that to buy those same “things to do” (assuming similar things are available for cash).
Just like using points for hotels or airlines, it's good to compare across the sites. We've never done the cash back option and likely never will. Keep checking and there are discounts to be had for sure!

Looking at some of the “Experiences” in the Chase app, they seem to value the UR points at exactly one penny per point. Not sure if that is the same as the “Things to do” redemption or how many points you earn on average per dollar spend, but I tend to get a higher value for my URs. Higher values tend to require transfers to other loyalty programs or travel purchases.

That's why you get to do you and I get to do me. Did you see that we have more points than we can possibly use? Geez....Sometimes the time spent looking for the absolute best deal is simply not worth it. Just click, print, go.

TravelGeek
Posts: 2967
Joined: Sat Oct 25, 2014 3:23 pm

Re: What's Your Credit Card Rewards Strategy?

Post by TravelGeek » Thu May 16, 2019 6:30 pm

mrsbetsy wrote:
Thu May 16, 2019 3:37 pm
That's why you get to do you and I get to do me. Did you see that we have more points than we can possibly use? Geez....Sometimes the time spent looking for the absolute best deal is simply not worth it. Just click, print, go.
I saw that. That doesn’t mean it is the best option. It could (given the limited data in your posts) be that 2 cents per dollar would be giving you more value with the same or less effort (dollars aren’t hard to spend either ... just click, print, go). On top of that, dollars are a more flexible currency.

As long as you are aware of your options and choose what works and/or is best for you, that’s fine. I was just offering my points (pun intended) to perhaps help explore other options. We all obviously operate (post) with limited data about each other’s situation here. I’ll shut up now.

Pu239
Posts: 66
Joined: Mon Dec 17, 2018 6:24 pm

Re: What's Your Credit Card Rewards Strategy?

Post by Pu239 » Sat May 18, 2019 6:02 pm

batpot wrote:
Tue May 14, 2019 4:43 pm

Yup, easily done.
Especially when you factor in earning 2.5% on plastique's 2.5% charge, and floating the child care payment a month.

Alternatively, we can cancel, and have the other spouse sign up; rinse, repeat, every year.
I just read a new comment on /r/churning that Alliant has stopped paying cash rewards for Plastiq payments. Is this true for you?

Pu239
Posts: 66
Joined: Mon Dec 17, 2018 6:24 pm

Re: What's Your Credit Card Rewards Strategy?

Post by Pu239 » Sat May 18, 2019 10:18 pm

Pu239 wrote:
Sat May 18, 2019 6:02 pm
batpot wrote:
Tue May 14, 2019 4:43 pm

Yup, easily done.
Especially when you factor in earning 2.5% on plastique's 2.5% charge, and floating the child care payment a month.

Alternatively, we can cancel, and have the other spouse sign up; rinse, repeat, every year.
I just read a new comment on /r/churning that Alliant has stopped paying cash rewards for Plastiq payments. Is this true for you?
This is confirmed on the Plastiq website: https://help.plastiq.com/hc/en-us/artic ... rd-Changes

Mastercards are not affected but many Visa cards will code as a cash advance. See link for details.

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