What's Your Credit Card Rewards Strategy?

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

Post by drk » Sat Mar 07, 2020 12:06 pm

Leesbro63 wrote:
Thu Mar 05, 2020 7:31 am
What is considered "incidental airline" charges for the BofA Premium Rewards card? Does that count purchased food (if you can call it that) on planes and wifi fees?
It's counted against airline ticket purchases for me.

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

Post by protagonist » Sat Mar 07, 2020 12:46 pm

Horsefly wrote:
Sat Mar 07, 2020 11:59 am
xb7 wrote:
Fri Mar 06, 2020 11:50 am
"Anyone with the Chase system care to comment, is it limiting to book travel through their system?"
I've done so a few times and found it hit-or-miss: sometimes I find the same flight or hotel in and out of the portal to be about the same cost, and book via the portal when it is. Others I find it more expensive in the portal, or more often, just not available --- that flight isn't found, that hotel has no vacancies on that day (when it does elsewhere).

I'm able to book through the portal often enough that it's working for me; I just recognize that it isn't perfect and am content. So far at least!
+1

We were doing a multi-hop trip to Hawaii in December, going Denver to Honolulu, to Kauai after a few days, and eventually back to Denver. For some reason, the only flight times available via the Chase portal for the hop from Honolulu to Lihue were at bad times, even though there were plenty of flights with openings.

It seems like most of the time the flights and hotels are on the portal, and at the same price. Unlike the Amex travel portal, where the prices are significantly inflated.
I have used the Chase portal several times and my experience is more or less the same as quoted above.
I rarely transfer to individual airline sites or hotel sites anymore....it used to be worth it, but now, between the frequent additional fees and restrictions on the other sites it is rarely worth my time to potentially save a small amount. I usually just book through Chase with the CSR points discount.

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

Post by EnjoyIt » Sat Mar 07, 2020 1:52 pm

protagonist wrote:
Sat Mar 07, 2020 12:46 pm
Horsefly wrote:
Sat Mar 07, 2020 11:59 am
xb7 wrote:
Fri Mar 06, 2020 11:50 am
"Anyone with the Chase system care to comment, is it limiting to book travel through their system?"
I've done so a few times and found it hit-or-miss: sometimes I find the same flight or hotel in and out of the portal to be about the same cost, and book via the portal when it is. Others I find it more expensive in the portal, or more often, just not available --- that flight isn't found, that hotel has no vacancies on that day (when it does elsewhere).

I'm able to book through the portal often enough that it's working for me; I just recognize that it isn't perfect and am content. So far at least!
+1

We were doing a multi-hop trip to Hawaii in December, going Denver to Honolulu, to Kauai after a few days, and eventually back to Denver. For some reason, the only flight times available via the Chase portal for the hop from Honolulu to Lihue were at bad times, even though there were plenty of flights with openings.

It seems like most of the time the flights and hotels are on the portal, and at the same price. Unlike the Amex travel portal, where the prices are significantly inflated.
I have used the Chase portal several times and my experience is more or less the same as quoted above.
I rarely transfer to individual airline sites or hotel sites anymore....it used to be worth it, but now, between the frequent additional fees and restrictions on the other sites it is rarely worth my time to potentially save a small amount. I usually just book through Chase with the CSR points discount.
Same here. Just bought United tickets that cost less points via the CSR portal compared to using United miles. Hotels are usually the same price via the portal. Sometimes hotels are a few bucks more but rarely much more.

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

Post by protagonist » Sat Mar 07, 2020 3:41 pm

I just booked a hotel room for a night through the Chase portal with CSR points.
The room would have cost me $160 with tax/fees through another service. With CSR points it cost me about 10,500 UR points, given the 50% bonus that the points are worth when used for travel. I figure that was worth at least $50 over other options (maybe $25 more than CSP) for one night alone, and I could have chosen from a very wide range of hotels (rather than the limited selection available if I used a specific hotel card). Since I transfer a large portion of my points from Freedom Unlimited at 1.5x, it was probably worth more than that.
The extra value is greater when booking an expensive plane ticket.
Given all the other benefits, I think CSR probably is worth the $155 more that it costs over CSP, even for only one or two international flights per year and one or two nights in a hotel. And if you get $60 worth of food via Door Dash (I have not tried that yet) the difference is only $95. If you eat out fairly often and have travel expenses (defined very broadly) the points will accumulate 50% faster than with CSP.
I don't think the extra value is tremendous vs. CSP, but I do think there is probably some extra value for anybody who flies at least one or two times per year and likes to eat out.
I will keep the card and add BOA Cash Rewards- probably with Platinum if I open a Merrill account with my brokered CDs. The card is free and I am well under 5/24 now so why not? I will not keep any other cards that charge annual fees (though I am ambivalent about possibly keeping my IHG card now that they raised the annual fee).

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

Post by Cruz » Mon Mar 09, 2020 8:51 am

Thanks for all the feedback on the Chase UR system. Seems most people have the CSR, which was appealing before they upped the annual fee. Any CSP users out there, is the $95 annual fee worth it for the mileage rewards?

One other card I’ve been considering is the Wells Fargo propel, 3x points in the categories I’m looking for (travel, dining), no AF or foreign transaction fees. Anyone have experience with this card?

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

Post by EnjoyIt » Mon Mar 09, 2020 11:14 am

Cruz wrote:
Mon Mar 09, 2020 8:51 am
Thanks for all the feedback on the Chase UR system. Seems most people have the CSR, which was appealing before they upped the annual fee. Any CSP users out there, is the $95 annual fee worth it for the mileage rewards?

One other card I’ve been considering is the Wells Fargo propel, 3x points in the categories I’m looking for (travel, dining), no AF or foreign transaction fees. Anyone have experience with this card?
I hate to say it, but this is a math problem for you. They are all good options depending on your needs.

If you travel a lot then the CSR is the best option because your points are worth anywhere between 4-4.5 cents per point which could far surpass the WF card or the CSP despite its fee. I think you just need to do your own math and see what works best for you.

Just as a side note, the Chase travel rewards multiplier for CSP is 1.25 cents per point but I find it worth a little less on hotels and exactly 1.25 cents per point on flights. Same goes for CSR. I recently started valuing it at 1.4 instead of 1.5.

For our math the CSR is well worth it especially when we combine it with the other chase cards.

Blue456
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Re: What's Your Credit Card Rewards Strategy?

Post by Blue456 » Mon Mar 09, 2020 11:46 am

EnjoyIt wrote:
Mon Mar 09, 2020 11:14 am

Just as a side note, the Chase travel rewards multiplier for CSP is 1.25 cents per point but I find it worth a little less on hotels and exactly 1.25 cents per point on flights. Same goes for CSR. I recently started valuing it at 1.4 instead of 1.5.

For our math the CSR is well worth it especially when we combine it with the other chase cards.
Are you sure? Last time I checked in October 2019, all hotels were 1.5 cents per point. Is this a new change for CSR???

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

Post by EnjoyIt » Mon Mar 09, 2020 12:34 pm

Blue456 wrote:
Mon Mar 09, 2020 11:46 am
EnjoyIt wrote:
Mon Mar 09, 2020 11:14 am

Just as a side note, the Chase travel rewards multiplier for CSP is 1.25 cents per point but I find it worth a little less on hotels and exactly 1.25 cents per point on flights. Same goes for CSR. I recently started valuing it at 1.4 instead of 1.5.

For our math the CSR is well worth it especially when we combine it with the other chase cards.
Are you sure? Last time I checked in October 2019, all hotels were 1.5 cents per point. Is this a new change for CSR???
My apologies. Let me explain. By going through the CSR portal you are missing out on other cash back portals or free nights if for example you go through hotels.com instead. I value that pathway at about a 10% discount making getting hotels via the chase portal 10% less efficient. Flights don’t have that option.

xb7
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Re: What's Your Credit Card Rewards Strategy?

Post by xb7 » Tue Mar 10, 2020 11:10 am

EnjoyIt wrote:
Mon Mar 09, 2020 11:14 am
I hate to say it, but this is a math problem for you. They are all good options depending on your needs.

If you travel a lot then the CSR is the best option because your points are worth anywhere between 4-4.5 cents per point which could far surpass the WF card or the CSP despite its fee. I think you just need to do your own math and see what works best for you.

...
...

For our math the CSR is well worth it especially when we combine it with the other chase cards.
Agreed. Building a little spreadsheet to track this helped me sort it out, comparing the net rewards from what I would get with a 2% cashback card. One question I had in doing so was whether I should factor in the sign-up bonus points. I'm not a churner, and am interested in the "steady state" payback, whether and by how much I'm doing better with the CSR + CFU combo. And if at some point in future we start to travel less I want to have a sense for when it's time to change my credit card mix. Indeed "using math" rather than just Kentucky windage.

Ultimately I decided to include the bonus points since they are part of the overall benefit, and knowing that I can temporarily remove them just to have a look at any point at the "steady state" net value equation.

Such a spreadsheet is not difficult to put together, just note that you want to factor in the annual fee and the travel credit. I did not try to monetize other benefits, such as lounge access or travel insurance, but --- that's why it's probably best to put together your own spreadsheet if this approach makes sense for you.

Ah, one other thing --- there's a somewhat tricky aspect to trying to figure out a "2% cashback card" equivalent value. Because most of us get our UR points from more than one card, and the cards accumulate them at a different ratio. So I just looked at past spending and guestimated that 80% of my points come from the Freedom Unlimited and 20% from the Sapphire Reserve. Of course this is a dynamic ratio, but I figure that as long as I'm close it gets me an answer that's "close enough".

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

Post by EnjoyIt » Tue Mar 10, 2020 11:35 am

xb7 wrote:
Tue Mar 10, 2020 11:10 am
EnjoyIt wrote:
Mon Mar 09, 2020 11:14 am
I hate to say it, but this is a math problem for you. They are all good options depending on your needs.

If you travel a lot then the CSR is the best option because your points are worth anywhere between 4-4.5 cents per point which could far surpass the WF card or the CSP despite its fee. I think you just need to do your own math and see what works best for you.

...
...

For our math the CSR is well worth it especially when we combine it with the other chase cards.
Agreed. Building a little spreadsheet to track this helped me sort it out, comparing the net rewards from what I would get with a 2% cashback card. One question I had in doing so was whether I should factor in the sign-up bonus points. I'm not a churner, and am interested in the "steady state" payback, whether and by how much I'm doing better with the CSR + CFU combo. And if at some point in future we start to travel less I want to have a sense for when it's time to change my credit card mix. Indeed "using math" rather than just Kentucky windage.

Ultimately I decided to include the bonus points since they are part of the overall benefit, and knowing that I can temporarily remove them just to have a look at any point at the "steady state" net value equation.

Such a spreadsheet is not difficult to put together, just note that you want to factor in the annual fee and the travel credit. I did not try to monetize other benefits, such as lounge access or travel insurance, but --- that's why it's probably best to put together your own spreadsheet if this approach makes sense for you.

Ah, one other thing --- there's a somewhat tricky aspect to trying to figure out a "2% cashback card" equivalent value. Because most of us get our UR points from more than one card, and the cards accumulate them at a different ratio. So I just looked at past spending and guestimated that 80% of my points come from the Freedom Unlimited and 20% from the Sapphire Reserve. Of course this is a dynamic ratio, but I figure that as long as I'm close it gets me an answer that's "close enough".
Just to point out, This year I intend to get my $60 from grub hub when I pick up food. Also, Chase has some offers when using a particular card and I received $20 from auto zone via my CSR. A couple of lyft discounts all of which makes the annual fee just a little but smaller.

xb7
Posts: 188
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Re: What's Your Credit Card Rewards Strategy?

Post by xb7 » Tue Mar 10, 2020 12:26 pm

EnjoyIt wrote:
Tue Mar 10, 2020 11:35 am
Just to point out, This year I intend to get my $60 from grub hub when I pick up food. Also, Chase has some offers when using a particular card and I received $20 from auto zone via my CSR. A couple of lyft discounts all of which makes the annual fee just a little but smaller.
No doubt. Maybe I'll factor that in --- I got my $60 from Doordash this year already, and have used Lyft some too. What's working for me is seeing that even without these "other" benefits, I'm doing better than a 2% cashback card.

Another way to think about all of this is to calculate a break-even point based on spending patterns. If, in fact, I end up on average getting 80% of my points from the CFU and 20% from the CSR, then one could think of these as a sort of combined card with a blended 1.8% points per dollar spent. If I posit that I'll use all of these points on the Chase travel portal, then that 1.8% becomes 1.8 * 1.5 = 2.7%.

Then given now a $550 annual fee and a $300 travel credit, it's simple algebra to ask "how much do I have to spend on my Chase cards to break even with 2.7% back versus with a no-fee 2% cash-back card?".

$550 - $300 = $250 net annual fee.

$250 = 0.007x (a net 0.7% increase with the combined Chase cards)

x = $35,714

So IF I were to disregard the various other benefits, I have to spend about $35k on this credit card combination per year to break even. Of course the real answer is "less than that" given the value of the other benefits, but everyone will value these differently.
Of course, everyone will have a different ratio of spending on the cards, some will also have the Freedom card, or a business card ---
The math isn't too difficult to work out, however, for each person's situation.

All of this omits the one-time benefit of sign-up bonuses for the various cards.

I should update my spreadsheet, try to value the various other benefits. I'm using it for three different purposes. Just because it was a fun exercise (1). It makes a handy log, which has the added bonus that I can show my sometimes skeptical wife that there are sufficiently tangible benefits (2). But primarily because if and when our situation changes, it will be helpful to use it to make an objective decision about changing things (3). Thus --- I should try to figure a personal value for the various benefits I guess.

Thanks for getting me to revisit this stuff!

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

Post by EnjoyIt » Tue Mar 10, 2020 12:35 pm

xb7 wrote:
Tue Mar 10, 2020 12:26 pm
EnjoyIt wrote:
Tue Mar 10, 2020 11:35 am
Just to point out, This year I intend to get my $60 from grub hub when I pick up food. Also, Chase has some offers when using a particular card and I received $20 from auto zone via my CSR. A couple of lyft discounts all of which makes the annual fee just a little but smaller.
No doubt. Maybe I'll factor that in --- I got my $60 from Doordash this year already, and have used Lyft some too. What's working for me is seeing that even without these "other" benefits, I'm doing better than a 2% cashback card.

Another way to think about all of this is to calculate a break-even point based on spending patterns. If, in fact, I end up on average getting 80% of my points from the CFU and 20% from the CSR, then one could think of these as a sort of combined card with a blended 1.8% points per dollar spent. If I posit that I'll use all of these points on the Chase travel portal, then that 1.8% becomes 1.8 * 1.5 = 2.7%.

Then given now a $550 annual fee and a $300 travel credit, it's simple algebra to ask "how much do I have to spend on my Chase cards to break even with 2.7% back versus with a no-fee 2% cash-back card?".

$550 - $300 = $250 net annual fee.

$250 = 0.007x (a net 0.7% increase with the combined Chase cards)

x = $35,714

So IF I were to disregard the various other benefits, I have to spend about $35k on this credit card combination per year to break even. Of course the real answer is "less than that" given the value of the other benefits, but everyone will value these differently.
Of course, everyone will have a different ratio of spending on the cards, some will also have the Freedom card, or a business card ---
The math isn't too difficult to work out, however, for each person's situation.

All of this omits the one-time benefit of sign-up bonuses for the various cards.

I should update my spreadsheet, try to value the various other benefits. I'm using it for three different purposes. Just because it was a fun exercise (1). It makes a handy log, which has the added bonus that I can show my sometimes skeptical wife that there are sufficiently tangible benefits (2). But primarily because if and when our situation changes, it will be helpful to use it to make an objective decision about changing things (3). Thus --- I should try to figure a personal value for the various benefits I guess.

Thanks for getting me to revisit this stuff!
Some of the really big value for us comes from the 5x freedom categories as well as the ink 5x category.

As I stated above, I value the CSR at 1.4 cents per point since I purchase hotels stays with it as well. So when I get something at 5 points that is an additional 2 cents at that valuation. Just $11250 spend at 5x and the card is worth it.

xb7
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Re: What's Your Credit Card Rewards Strategy?

Post by xb7 » Tue Mar 10, 2020 12:55 pm

EnjoyIt wrote:
Tue Mar 10, 2020 12:35 pm
Some of the really big value for us comes from the 5x freedom categories as well as the ink 5x category.

As I stated above, I value the CSR at 1.4 cents per point since I purchase hotels stays with it as well. So when I get something at 5 points that is an additional 2 cents at that valuation. Just $11250 spend at 5x and the card is worth it.
Left to my own devices I'd have the Freedom card as well, but marriage is all about compromise (business cards not an option). My wife (and I admit, myself to some degree too) prefers to keep things simple. I have the CSR, she doesn't so I pay for meals and travel. She just has one single CFU and that makes her life easy. She keeps the budget and doesn't want yet another card to track (our total combination is CSR, CFU, and the Amazon visa).

The other thing that makes me somewhat okay with this is that, if I recall correctly, there's a spending limit on the Freedom card benefit, i.e., you don't get unlimited 5x back. Maybe I wouldn't be hitting that spending limit though ...

Anyway, it's a "benefit vs. KISS principle" thing. To each their own!

I understand what you mean about the hotels thing. On booking.com I'm "second level genius" or whatever flattering category name they give it, and this is supposed to reduce costs a bit when booking through them. I mostly do it as their site generally works pretty well from PC or android device, but this sort of thing does make it ever more difficult to compare apples to apples. Expedia has some sort of "point" system too, and then there are per-hotel-chain reward programs to also make comparisons more challenging. And then there are AARP and sometimes military veteran discounts ... great, but more complication too.

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

Post by EnjoyIt » Tue Mar 10, 2020 1:16 pm

xb7 wrote:
Tue Mar 10, 2020 12:55 pm
EnjoyIt wrote:
Tue Mar 10, 2020 12:35 pm
Some of the really big value for us comes from the 5x freedom categories as well as the ink 5x category.

As I stated above, I value the CSR at 1.4 cents per point since I purchase hotels stays with it as well. So when I get something at 5 points that is an additional 2 cents at that valuation. Just $11250 spend at 5x and the card is worth it.
Left to my own devices I'd have the Freedom card as well, but marriage is all about compromise (business cards not an option). My wife (and I admit, myself to some degree too) prefers to keep things simple. I have the CSR, she doesn't so I pay for meals and travel. She just has one single CFU and that makes her life easy. She keeps the budget and doesn't want yet another card to track (our total combination is CSR, CFU, and the Amazon visa).

The other thing that makes me somewhat okay with this is that, if I recall correctly, there's a spending limit on the Freedom card benefit, i.e., you don't get unlimited 5x back. Maybe I wouldn't be hitting that spending limit though ...

Anyway, it's a "benefit vs. KISS principle" thing. To each their own!

I understand what you mean about the hotels thing. On booking.com I'm "second level genius" or whatever flattering category name they give it, and this is supposed to reduce costs a bit when booking through them. I mostly do it as their site generally works pretty well from PC or android device, but this sort of thing does make it ever more difficult to compare apples to apples. Expedia has some sort of "point" system too, and then there are per-hotel-chain reward programs to also make comparisons more challenging. And then there are AARP and sometimes military veteran discounts ... great, but more complication too.
KISS is important
Freedom has a 1500 limit per quarter
Ink Business has a 25k limit.
you can have multiple of the same card.

For example, we shop at the same grocery stores so using up the 5x grocery limit on each card is pretty easy. Just buy a bunch of gift cards for said stores. If each person has 2 cards that is $6k alone right there and we spend more than $6k on groceries every month (yes, I know that is more than some bogleheads but that is another topic.)

One step at a time. In several months to a year, get the chase freedom card for the 5x. It should be an easy sell once used to the 2 cards you have now.

To be honest it has been a small battle (not heated) with my spouse on getting her to use the right card for maximizing points. Today, as long as I keep her informed she tends to comply. I said it makes me happy and very little effort on her part so why fight it.

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

Post by walkindude » Tue Mar 10, 2020 2:41 pm

EnjoyIt wrote:
Tue Mar 10, 2020 1:16 pm
...If each person has 2 cards that is $6k alone right there and we spend more than $6k on groceries every month (yes, I know that is more than some bogleheads but that is another topic.)...
I assume you mean $6k/quarter? If not, that IS a whole lot of grocery spending!

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

Post by EnjoyIt » Tue Mar 10, 2020 3:28 pm

walkindude wrote:
Tue Mar 10, 2020 2:41 pm
EnjoyIt wrote:
Tue Mar 10, 2020 1:16 pm
...If each person has 2 cards that is $6k alone right there and we spend more than $6k on groceries every month (yes, I know that is more than some bogleheads but that is another topic.)...
I assume you mean $6k/quarter? If not, that IS a whole lot of grocery spending!
$6k per quarter with gift cards to last the rest of the year. So $6k for the year. We actually spend more than that.

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

Post by protagonist » Tue Mar 10, 2020 3:37 pm

deleted
Last edited by protagonist on Tue Mar 10, 2020 4:24 pm, edited 1 time in total.

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

Post by protagonist » Tue Mar 10, 2020 3:43 pm

EnjoyIt wrote:
Tue Mar 10, 2020 12:35 pm



Just $11250 spend at 5x and the card is worth it.
Freedom limits you to $1500 per quarter in spending at 5x. Perhaps your spending habits are different than mine, but, depending on the category, I often find it difficult to come close to that limit. I don't spend just for the purpose of accumulating points.

The bottom line is that I think for most of us the benefits of CSR may exceed the additional cost, and if not, probably come close. I don't think it is worth quibbling over a few bucks one way or the other. It is difficult to put a monetary value on all of the additional benefits with CSR, just as it is difficult to put a monetary value on getting immediate cash back vs. "points". I'm keeping the card (partly a function of inertia, as thinking too much about it is not worth the difference it will make to my financial status).
Last edited by protagonist on Tue Mar 10, 2020 4:24 pm, edited 2 times in total.

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

Post by EnjoyIt » Tue Mar 10, 2020 4:12 pm

protagonist wrote:
Tue Mar 10, 2020 3:43 pm
protagonist wrote:
Tue Mar 10, 2020 3:37 pm
EnjoyIt wrote:
Tue Mar 10, 2020 12:35 pm



Just $11250 spend at 5x and the card is worth it.
Freedom limits you to $1500 per quarter in spending at 5x. Perhaps your spending habits are different than mine, but, depending on the category, I often find it difficult to come close to that limit. I don't spend just for the purpose of accumulating points.

The bottom line is that I think for most of us the benefits of CSR may exceed the additional cost, and if not, probably come close. I don't think it is worth quibbling over a few bucks one way or the other. It is difficult to put a monetary value on all of the additional benefits with CSR, just as it is difficult to put a monetary value on getting immediate cash back vs. "points". I'm keeping the card (partly a function of inertia, as thinking too much about it is not worth the difference it will make to my financial status).
You can have more than 1 Freedom card and so can your spouse. Each card has a quarterly limit of 1500. With 4 cards it is pretty easy to get to $6k in groceries if you max it out before the end of the quarter and get your grocery store's gift cards.

$6k a year for groceries for a family of 2+ is not that unreasonable.
Add in maybe another $2k-$3k in gas and a few department store spendings.
Add the Chase ink cash card and put all cell phone and cable expenses on there worth $2-$3k
Plus eating out and travel is an extra point plus the multiplier. I think it is pretty easy to get to the fee.
We tend to get a new Chase card every year worth a bonus which gets the 1.5 multiplier.
There are other ways to get 5 points on other spend I won't get into here.

But, you are right the cash difference is not that significant. Me, I like the game. I find it fun so its worth it to me even if the benefits are not huge.

xb7
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Re: What's Your Credit Card Rewards Strategy?

Post by xb7 » Wed Mar 11, 2020 10:49 am

EnjoyIt wrote:
Tue Mar 10, 2020 4:12 pm
You can have more than 1 Freedom card and so can your spouse.
I'm not interested in doing this (KISS principle again) but am curious --- this is a new concept for me. So I have a Freedom card in my name, and I go to Chase and say "I'd like to apply for a Freedom card" ?? I'm not challenging you here, just trying to wrap my brain around the concept!

What I do well understand is how my wife would react if I suggested that she get one --- or two ! --- additional credit cards for her to use in certain situations that change quarterly, up to a certain limit each, and have to 'activate' the card(s) quarterly for the bonus categories at the start of each quarter ...

I think I will forego both the benefits and the costs of this approach. :-)

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

Post by Horsefly » Wed Mar 11, 2020 11:56 am

xb7 wrote:
Wed Mar 11, 2020 10:49 am
EnjoyIt wrote:
Tue Mar 10, 2020 4:12 pm
You can have more than 1 Freedom card and so can your spouse.
I'm not interested in doing this (KISS principle again) but am curious --- this is a new concept for me. So I have a Freedom card in my name, and I go to Chase and say "I'd like to apply for a Freedom card" ?? I'm not challenging you here, just trying to wrap my brain around the concept!
One common way I've heard of is having a Freedom card, and downgrading a Sapphire card down to Freedom. That leaves you with two, and Chase doesn't seem to have a problem with it. I don't think I would give up my Sapphire card to do it, but I guess if you had a Sapphire Preferred and wanted to now apply for a Sapphire Reserve, that could be one reason.

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

Post by EnjoyIt » Wed Mar 11, 2020 2:27 pm

Horsefly wrote:
Wed Mar 11, 2020 11:56 am
xb7 wrote:
Wed Mar 11, 2020 10:49 am
EnjoyIt wrote:
Tue Mar 10, 2020 4:12 pm
You can have more than 1 Freedom card and so can your spouse.
I'm not interested in doing this (KISS principle again) but am curious --- this is a new concept for me. So I have a Freedom card in my name, and I go to Chase and say "I'd like to apply for a Freedom card" ?? I'm not challenging you here, just trying to wrap my brain around the concept!
One common way I've heard of is having a Freedom card, and downgrading a Sapphire card down to Freedom. That leaves you with two, and Chase doesn't seem to have a problem with it. I don't think I would give up my Sapphire card to do it, but I guess if you had a Sapphire Preferred and wanted to now apply for a Sapphire Reserve, that could be one reason.
That is how I did it.

Cruz
Posts: 176
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Re: What's Your Credit Card Rewards Strategy?

Post by Cruz » Wed Mar 11, 2020 6:40 pm

xb7 wrote:
Tue Mar 10, 2020 11:10 am
EnjoyIt wrote:
Mon Mar 09, 2020 11:14 am
I hate to say it, but this is a math problem for you. They are all good options depending on your needs.

If you travel a lot then the CSR is the best option because your points are worth anywhere between 4-4.5 cents per point which could far surpass the WF card or the CSP despite its fee. I think you just need to do your own math and see what works best for you.

...
...

For our math the CSR is well worth it especially when we combine it with the other chase cards.
Agreed. Building a little spreadsheet to track this helped me sort it out, comparing the net rewards from what I would get with a 2% cashback card. One question I had in doing so was whether I should factor in the sign-up bonus points. I'm not a churner, and am interested in the "steady state" payback, whether and by how much I'm doing better with the CSR + CFU combo. And if at some point in future we start to travel less I want to have a sense for when it's time to change my credit card mix. Indeed "using math" rather than just Kentucky windage.

Ultimately I decided to include the bonus points since they are part of the overall benefit, and knowing that I can temporarily remove them just to have a look at any point at the "steady state" net value equation.

Such a spreadsheet is not difficult to put together, just note that you want to factor in the annual fee and the travel credit. I did not try to monetize other benefits, such as lounge access or travel insurance, but --- that's why it's probably best to put together your own spreadsheet if this approach makes sense for you.

Ah, one other thing --- there's a somewhat tricky aspect to trying to figure out a "2% cashback card" equivalent value. Because most of us get our UR points from more than one card, and the cards accumulate them at a different ratio. So I just looked at past spending and guestimated that 80% of my points come from the Freedom Unlimited and 20% from the Sapphire Reserve. Of course this is a dynamic ratio, but I figure that as long as I'm close it gets me an answer that's "close enough".
No doubt it is a math exercise at this point. I was mostly curious with peoples experience with cards and redeeming points so all that feedback was really helpful.

A spreadsheet doesn't seem too hard to build...figure out annual spending for categories (dining, travel, gas, groceries...etc) and then build in some way to see reward value amongst the different cards. Sorting out the UR rewards from different cards may be tricky but I like the approach of estimating a ratio - what do you use as a value for points? ThePointsGuy website values? Am I missing anything else?

xb7
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Re: What's Your Credit Card Rewards Strategy?

Post by xb7 » Wed Mar 11, 2020 7:21 pm

Cruz wrote:
Wed Mar 11, 2020 6:40 pm
... - what do you use as a value for points? ThePointsGuy website values? Am I missing anything else?
Everyone is a bit different on this. Thus far I've only redeemed points through the portal, and only when the equivalent price is about the same as I can get elsewhere, so it's easy for me --- I have a CSR so a point is worth 1.5 cents. Well, as someone else said, even that's arguable, as you might have some other way of getting a bit of a discount sometimes purchasing elsewhere, but ... close enough for me.

If at some point I start moving points to airline or even hotel sites to get their points/miles to spend at a more favorable rate, I might value them differently.

Ultimately I think you have to value points based on how you personally anticipate using them.

investor997
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Re: What's Your Credit Card Rewards Strategy?

Post by investor997 » Wed Mar 11, 2020 9:59 pm

Cruz wrote:
Wed Mar 11, 2020 6:40 pm
A spreadsheet doesn't seem too hard to build...figure out annual spending for categories (dining, travel, gas, groceries...etc) and then build in some way to see reward value amongst the different cards. Sorting out the UR rewards from different cards may be tricky but I like the approach of estimating a ratio - what do you use as a value for points? ThePointsGuy website values? Am I missing anything else?
This is exactly what I did, and based on my spending I was able to determine that BofA's Premium Rewards/Cash Rewards + Platinum Preferred status was unbeatable against any CSR/CFU combination so long as a UR point was valued at $0.017 or less.

I would NOT use TPG's points valuations. They're way overinflated unless by some miracle you're able to transfer your UR points to airlines and book business class flights at high point valuations... I found that to be nearly impossible, but who knows... There could be a lot of award flights available with this whole coronavirus thing.

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

Post by protagonist » Mon Mar 16, 2020 3:10 pm

I was going to move $100K of maturing CDs to Merrill in order to get the BoA Cash Rewards card with 75% premium, but I re-thought my strategy when I saw how low the return on brokered CDs was cf. the best bank/CU offers, or even with my online bank account (1.86% as of 2 days ago).

Under the circumstances I will stick with the Chase trifecta for now. (CSR+ Freedom Unl.+Freedom). It simplifies my life, and a minimum of 2.25% back on travel is pretty competitive with anything on the market.
Last edited by protagonist on Tue Mar 17, 2020 6:18 pm, edited 1 time in total.

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

Post by protagonist » Tue Mar 17, 2020 6:14 pm

Chase Ink Business Preferred just raised its sign-on bonus to 100K UR points. $95 annual fee.

This seems like a deal too good to refuse.

Unfortunately I don't think I could (or want to) meet the stiff $15K in 3 months spending requirement

But some of you probably can.

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

Post by protagonist » Tue Mar 17, 2020 6:24 pm

investor997 wrote:
Wed Mar 11, 2020 9:59 pm
Cruz wrote:
Wed Mar 11, 2020 6:40 pm
A spreadsheet doesn't seem too hard to build...figure out annual spending for categories (dining, travel, gas, groceries...etc) and then build in some way to see reward value amongst the different cards. Sorting out the UR rewards from different cards may be tricky but I like the approach of estimating a ratio - what do you use as a value for points? ThePointsGuy website values? Am I missing anything else?
This is exactly what I did, and based on my spending I was able to determine that BofA's Premium Rewards/Cash Rewards + Platinum Preferred status was unbeatable against any CSR/CFU combination so long as a UR point was valued at $0.017 or less.

I would NOT use TPG's points valuations. They're way overinflated unless by some miracle you're able to transfer your UR points to airlines and book business class flights at high point valuations... I found that to be nearly impossible, but who knows... There could be a lot of award flights available with this whole coronavirus thing.
UR point value if spent via Chase Travel Portal and converted to CSR if you have CSR, Freedom Unl. and Freedom:
$0.045 if earned via travel or restaurants (using CSR)
$0.075 for category spending (using Freedom)
$0.0225 for everything else (using Freedom Unl.)

Annual fee for holding the 3 cards: $550 with $300 travel reimbursement and other reimbursements and benefits described in multiple posts above.

But the bottom line is the real bang for the buck is in the sign-on promos, not in the day-to-day spending.

investor997
Posts: 534
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Re: What's Your Credit Card Rewards Strategy?

Post by investor997 » Tue Mar 17, 2020 7:48 pm

protagonist wrote:
Tue Mar 17, 2020 6:24 pm
UR point value if spent via Chase Travel Portal and converted to CSR if you have CSR, Freedom Unl. and Freedom:
$0.045 if earned via travel or restaurants (using CSR)
$0.075 for category spending (using Freedom)
$0.0225 for everything else (using Freedom Unl.)
No. For CSR cardholders, a UR point is always valued at $0.015 when spent on the Chase Travel Portal. You might earn $0.045 worth at restaurants (because you earn 3 points/$) but the *valuation* is always $0.015 per point. The only way to get a higher valuation is by transferring the points to a travel partner.

Frankly in this day and age of COVID-19 and the travel industry grinding to a halt, cash back cards are more valuable now than ever before.

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

Post by protagonist » Wed Mar 18, 2020 10:21 am

investor997 wrote:
Tue Mar 17, 2020 7:48 pm
protagonist wrote:
Tue Mar 17, 2020 6:24 pm
UR point value if spent via Chase Travel Portal and converted to CSR if you have CSR, Freedom Unl. and Freedom:
$0.045 if earned via travel or restaurants (using CSR)
$0.075 for category spending (using Freedom)
$0.0225 for everything else (using Freedom Unl.)
No. For CSR cardholders, a UR point is always valued at $0.015 when spent on the Chase Travel Portal. You might earn $0.045 worth at restaurants (because you earn 3 points/$) but the *valuation* is always $0.015 per point. The only way to get a higher valuation is by transferring the points to a travel partner.

Frankly in this day and age of COVID-19 and the travel industry grinding to a halt, cash back cards are more valuable now than ever before.
Technically, yes, you are right. I should have said: for every dollar spent on travel or restaurants you get the equivalent of 4.5 cents back if points are redeemed for travel via the Portal. And even if just redeemed for cash credit it would be 3 cents back, correct?
Whether or not that is worth more than 2 cents cash back per dollar ("a bird in the hand") is a moot point. I cannot answer that. But in the long run, it probably doesn't make a huge difference. So I am sticking with the UR trifecta because I already have it. If I had a cash back card I would probably stick with that.
Last edited by protagonist on Wed Mar 18, 2020 10:46 am, edited 1 time in total.

EnjoyIt
Posts: 3524
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Re: What's Your Credit Card Rewards Strategy?

Post by EnjoyIt » Wed Mar 18, 2020 10:23 am

protagonist wrote:
Wed Mar 18, 2020 10:21 am
investor997 wrote:
Tue Mar 17, 2020 7:48 pm
protagonist wrote:
Tue Mar 17, 2020 6:24 pm
UR point value if spent via Chase Travel Portal and converted to CSR if you have CSR, Freedom Unl. and Freedom:
$0.045 if earned via travel or restaurants (using CSR)
$0.075 for category spending (using Freedom)
$0.0225 for everything else (using Freedom Unl.)
No. For CSR cardholders, a UR point is always valued at $0.015 when spent on the Chase Travel Portal. You might earn $0.045 worth at restaurants (because you earn 3 points/$) but the *valuation* is always $0.015 per point. The only way to get a higher valuation is by transferring the points to a travel partner.

Frankly in this day and age of COVID-19 and the travel industry grinding to a halt, cash back cards are more valuable now than ever before.
Technically, yes, you are right. I should have said: for every dollar spent on travel or restaurants you get the equivalent of 4.5 cents back if points are redeemed for travel via the Portal.
Whether or not that is worth more than 2 cents cash back per dollar ("a bird in the hand") is a moot point. I cannot answer that. But in the long run, it probably doesn't make a huge difference. So I am sticking with the UR trifecta because I already have it. If I had a cash back card I would probably stick with that.
Get the business ink cash card and put your phone bill and cable on there. Easy 5 points with minimal additional effort. Plus get the 50k bonus on top.

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

Post by protagonist » Wed Mar 18, 2020 10:39 am

EnjoyIt wrote:
Wed Mar 18, 2020 10:23 am
protagonist wrote:
Wed Mar 18, 2020 10:21 am
investor997 wrote:
Tue Mar 17, 2020 7:48 pm
protagonist wrote:
Tue Mar 17, 2020 6:24 pm
UR point value if spent via Chase Travel Portal and converted to CSR if you have CSR, Freedom Unl. and Freedom:
$0.045 if earned via travel or restaurants (using CSR)
$0.075 for category spending (using Freedom)
$0.0225 for everything else (using Freedom Unl.)
No. For CSR cardholders, a UR point is always valued at $0.015 when spent on the Chase Travel Portal. You might earn $0.045 worth at restaurants (because you earn 3 points/$) but the *valuation* is always $0.015 per point. The only way to get a higher valuation is by transferring the points to a travel partner.

Frankly in this day and age of COVID-19 and the travel industry grinding to a halt, cash back cards are more valuable now than ever before.
Technically, yes, you are right. I should have said: for every dollar spent on travel or restaurants you get the equivalent of 4.5 cents back if points are redeemed for travel via the Portal.
Whether or not that is worth more than 2 cents cash back per dollar ("a bird in the hand") is a moot point. I cannot answer that. But in the long run, it probably doesn't make a huge difference. So I am sticking with the UR trifecta because I already have it. If I had a cash back card I would probably stick with that.
Get the business ink cash card and put your phone bill and cable on there. Easy 5 points with minimal additional effort. Plus get the 50k bonus on top.
I don't have cable, and pay $12/month for phone service (Xfinity charges $12/Gb/mo. and I essentially never go above 1 Gb)
That would save me a grand total of $7.20/year. ($144 x .05).
The 50K would be nice but I already have over 500K and have been at about that level for 4 years. Maybe if I need more UR points I will get it some day.

Cruz
Posts: 176
Joined: Sun Mar 30, 2014 7:16 pm

Re: What's Your Credit Card Rewards Strategy?

Post by Cruz » Tue Mar 24, 2020 7:53 pm

Question on the BofA Premium Rewards Credit Card, they are currently offering 50,000 bonus points for signing up, which is a $500 value, can this be redeemed for cash back?

drk
Posts: 1623
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Location: Seattle

Re: What's Your Credit Card Rewards Strategy?

Post by drk » Tue Mar 24, 2020 9:04 pm

Cruz wrote:
Tue Mar 24, 2020 7:53 pm
Question on the BofA Premium Rewards Credit Card, they are currently offering 50,000 bonus points for signing up, which is a $500 value, can this be redeemed for cash back?
Yes, you can get the cash value ($0.01 per point) deposited into your checking or brokerage account.

MikeG62
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Location: New Jersey

Re: What's Your Credit Card Rewards Strategy?

Post by MikeG62 » Wed Mar 25, 2020 9:21 am

protagonist wrote:
Mon Mar 16, 2020 3:10 pm
I was going to move $100K of maturing CDs to Merrill in order to get the BoA Cash Rewards card with 75% premium, but I re-thought my strategy when I saw how low the return on brokered CDs was cf. the best bank/CU offers, or even with my online bank account (1.86% as of 2 days ago).

Under the circumstances I will stick with the Chase trifecta for now. (CSR+ Freedom Unl.+Freedom). It simplifies my life, and a minimum of 2.25% back on travel is pretty competitive with anything on the market.
I would not use cash (or CD’s) to get the 75% bump. I transferred assets in kind (investments) I had sitting at Fidelity. The assets would have remained at Fidelity had I not transferred to Merrill Edge invested exactly the same way.

I opened an IRA account at Merrill Edge and transferred $200,000 in shares in a bond fund I had in my IRA at Fidelity and opened a brokerage account at Merrill Edge and transferred $200,000 in shares of an equity ETF. Both accounts qualify for a $900 cash bonus after 90-days. Once the bonus posts, I will transfer the equity EFT back to Fidelity and 1/2 of the bond fund as well. I’ll then just retain $100,000 of the bond fund shares at Merrill Edge to earn the 2.625% cash back incentive.
Real Knowledge Comes Only From Experience

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

Post by protagonist » Wed Mar 25, 2020 9:26 am

MikeG62 wrote:
Wed Mar 25, 2020 9:21 am
protagonist wrote:
Mon Mar 16, 2020 3:10 pm
I was going to move $100K of maturing CDs to Merrill in order to get the BoA Cash Rewards card with 75% premium, but I re-thought my strategy when I saw how low the return on brokered CDs was cf. the best bank/CU offers, or even with my online bank account (1.86% as of 2 days ago).

Under the circumstances I will stick with the Chase trifecta for now. (CSR+ Freedom Unl.+Freedom). It simplifies my life, and a minimum of 2.25% back on travel is pretty competitive with anything on the market.
I would not use cash (or CD’s) to get the 75% bump. I transferred assets in kind (investments) I had sitting at Fidelity. The assets would have remained at Fidelity had I not transferred to Merrill Edge invested exactly the same way.

I opened an IRA account at Merrill Edge and transferred $200,000 in shares in a bond fund I had in my IRA at Fidelity and opened a brokerage account at Merrill Edge and transferred $200,000 in shares of an equity ETF. Both accounts qualify for a $900 cash bonus after 90-days. Once the bonus posts, I will transfer the equity EFT back to Fidelity and 1/2 of the bond fund as well. I’ll then just retain $100,000 of the bond fund shares at Merrill Edge to earn the 2.625% cash back incentive.
That would work, but my only remaining fund is FFNOX, which I have held since at least the early 2000s. If I found equivalent ETFs for its components I would have a massive tax bill on the gains.

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

Post by protagonist » Wed Mar 25, 2020 9:54 am

xb7 wrote:
Tue Mar 10, 2020 12:26 pm
EnjoyIt wrote:
Tue Mar 10, 2020 11:35 am
Just to point out, This year I intend to get my $60 from grub hub when I pick up food. Also, Chase has some offers when using a particular card and I received $20 from auto zone via my CSR. A couple of lyft discounts all of which makes the annual fee just a little but smaller.
No doubt. Maybe I'll factor that in --- I got my $60 from Doordash this year already, and have used Lyft some too. What's working for me is seeing that even without these "other" benefits, I'm doing better than a 2% cashback card.

Another way to think about all of this is to calculate a break-even point based on spending patterns. If, in fact, I end up on average getting 80% of my points from the CFU and 20% from the CSR, then one could think of these as a sort of combined card with a blended 1.8% points per dollar spent. If I posit that I'll use all of these points on the Chase travel portal, then that 1.8% becomes 1.8 * 1.5 = 2.7%.

Then given now a $550 annual fee and a $300 travel credit, it's simple algebra to ask "how much do I have to spend on my Chase cards to break even with 2.7% back versus with a no-fee 2% cash-back card?".

$550 - $300 = $250 net annual fee.

$250 = 0.007x (a net 0.7% increase with the combined Chase cards)

x = $35,714

So IF I were to disregard the various other benefits, I have to spend about $35k on this credit card combination per year to break even. Of course the real answer is "less than that" given the value of the other benefits, but everyone will value these differently.
Of course, everyone will have a different ratio of spending on the cards, some will also have the Freedom card, or a business card ---
The math isn't too difficult to work out, however, for each person's situation.

All of this omits the one-time benefit of sign-up bonuses for the various cards.

I should update my spreadsheet, try to value the various other benefits. I'm using it for three different purposes. Just because it was a fun exercise (1). It makes a handy log, which has the added bonus that I can show my sometimes skeptical wife that there are sufficiently tangible benefits (2). But primarily because if and when our situation changes, it will be helpful to use it to make an objective decision about changing things (3). Thus --- I should try to figure a personal value for the various benefits I guess.

Thanks for getting me to revisit this stuff!
Another factor ( harder to put a monetary value on) is hassle factor....another account....another card....another credit pull...more time spent on application...more record keeping...another tax form....etc.
"Break even" is one thing, but how much is the hassle worth? $50/year beyond break even? $100? $500? Everybody needs to answer that for themselves, but the net "break-even" spend with hassle factored in would be something less than $35,714/year.
And another question to ask is, how much would the savings impact the rest of my life? If you have less money than you need already, then perhaps a few hundred a year would be worth the hassle. It might mean an additional road trip or that new cell phone that you cannot afford otherwise. If you have enough, and it's already working for you, why bother?

EnjoyIt
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Joined: Sun Dec 29, 2013 8:06 pm

Re: What's Your Credit Card Rewards Strategy?

Post by EnjoyIt » Wed Mar 25, 2020 10:21 am

protagonist wrote:
Wed Mar 25, 2020 9:54 am
xb7 wrote:
Tue Mar 10, 2020 12:26 pm
EnjoyIt wrote:
Tue Mar 10, 2020 11:35 am
Just to point out, This year I intend to get my $60 from grub hub when I pick up food. Also, Chase has some offers when using a particular card and I received $20 from auto zone via my CSR. A couple of lyft discounts all of which makes the annual fee just a little but smaller.
No doubt. Maybe I'll factor that in --- I got my $60 from Doordash this year already, and have used Lyft some too. What's working for me is seeing that even without these "other" benefits, I'm doing better than a 2% cashback card.

Another way to think about all of this is to calculate a break-even point based on spending patterns. If, in fact, I end up on average getting 80% of my points from the CFU and 20% from the CSR, then one could think of these as a sort of combined card with a blended 1.8% points per dollar spent. If I posit that I'll use all of these points on the Chase travel portal, then that 1.8% becomes 1.8 * 1.5 = 2.7%.

Then given now a $550 annual fee and a $300 travel credit, it's simple algebra to ask "how much do I have to spend on my Chase cards to break even with 2.7% back versus with a no-fee 2% cash-back card?".

$550 - $300 = $250 net annual fee.

$250 = 0.007x (a net 0.7% increase with the combined Chase cards)

x = $35,714

So IF I were to disregard the various other benefits, I have to spend about $35k on this credit card combination per year to break even. Of course the real answer is "less than that" given the value of the other benefits, but everyone will value these differently.
Of course, everyone will have a different ratio of spending on the cards, some will also have the Freedom card, or a business card ---
The math isn't too difficult to work out, however, for each person's situation.

All of this omits the one-time benefit of sign-up bonuses for the various cards.

I should update my spreadsheet, try to value the various other benefits. I'm using it for three different purposes. Just because it was a fun exercise (1). It makes a handy log, which has the added bonus that I can show my sometimes skeptical wife that there are sufficiently tangible benefits (2). But primarily because if and when our situation changes, it will be helpful to use it to make an objective decision about changing things (3). Thus --- I should try to figure a personal value for the various benefits I guess.

Thanks for getting me to revisit this stuff!
Another factor ( harder to put a monetary value on) is hassle factor....another account....another card....another credit pull...more time spent on application...more record keeping...another tax form....etc.
"Break even" is one thing, but how much is the hassle worth? $50/year beyond break even? $100? $500? Everybody needs to answer that for themselves, but the net "break-even" spend with hassle factored in would be something less than $35,714/year.
And another question to ask is, how much would the savings impact the rest of my life? If you have less money than you need already, then perhaps a few hundred a year would be worth the hassle. It might mean an additional road trip or that new cell phone that you cannot afford otherwise. If you have enough, and it's already working for you, why bother?
You are sooooo right. Is it worth all the steps I take for a few extra dollars? I don't know, based on how much I get paid per hour at work, probably not. But, I work part time and not looking to work extra, and I enjoy the process as well as maneuvering through the intricacies of the game. Yup, it is like a game to me.

I am positive that if I was working full time like I was just a few years ago, it is unlikely I would still be playing.

What is interesting, is that we have a bunch of Chase points that we would have utilized this year but likely our 2 weeks in Europe is canceled. Luckily we have not bought tickets yet. Now we are sitting on a ton of points and still accumulating more just through natural spending.

I would also like to add that every year we (spouse and I tend to get 1-4 new credit cards that offer us bonuses. A one time bonus of 50k points is worth an extra $250 (that is if we actually get to spend it on travel.) That alone makes the CSR worth it. This year if the offer does not expire I will be getting the Chase ink reserve that will give us $80k - $100k points.
Last edited by EnjoyIt on Wed Mar 25, 2020 11:01 am, edited 1 time in total.

xb7
Posts: 188
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Location: WA State, USA

Re: What's Your Credit Card Rewards Strategy?

Post by xb7 » Wed Mar 25, 2020 10:56 am

protagonist wrote:
Wed Mar 25, 2020 9:54 am
xb7 wrote:
Tue Mar 10, 2020 12:26 pm
EnjoyIt wrote:
Tue Mar 10, 2020 11:35 am
Just to point out, This year I intend to get my $60 from grub hub when I pick up food. Also, Chase has some offers when using a particular card and I received $20 from auto zone via my CSR. A couple of lyft discounts all of which makes the annual fee just a little but smaller.
No doubt. Maybe I'll factor that in --- I got my $60 from Doordash this year already, and have used Lyft some too. What's working for me is seeing that even without these "other" benefits, I'm doing better than a 2% cashback card.

Another way to think about all of this is to calculate a break-even point based on spending patterns. If, in fact, I end up on average getting 80% of my points from the CFU and 20% from the CSR, then one could think of these as a sort of combined card with a blended 1.8% points per dollar spent. If I posit that I'll use all of these points on the Chase travel portal, then that 1.8% becomes 1.8 * 1.5 = 2.7%.

Then given now a $550 annual fee and a $300 travel credit, it's simple algebra to ask "how much do I have to spend on my Chase cards to break even with 2.7% back versus with a no-fee 2% cash-back card?".

$550 - $300 = $250 net annual fee.

$250 = 0.007x (a net 0.7% increase with the combined Chase cards)

x = $35,714

So IF I were to disregard the various other benefits, I have to spend about $35k on this credit card combination per year to break even. Of course the real answer is "less than that" given the value of the other benefits, but everyone will value these differently.
Of course, everyone will have a different ratio of spending on the cards, some will also have the Freedom card, or a business card ---
The math isn't too difficult to work out, however, for each person's situation.

All of this omits the one-time benefit of sign-up bonuses for the various cards.

I should update my spreadsheet, try to value the various other benefits. I'm using it for three different purposes. Just because it was a fun exercise (1). It makes a handy log, which has the added bonus that I can show my sometimes skeptical wife that there are sufficiently tangible benefits (2). But primarily because if and when our situation changes, it will be helpful to use it to make an objective decision about changing things (3). Thus --- I should try to figure a personal value for the various benefits I guess.

Thanks for getting me to revisit this stuff!
Another factor ( harder to put a monetary value on) is hassle factor....another account....another card....another credit pull...more time spent on application...more record keeping...another tax form....etc.
"Break even" is one thing, but how much is the hassle worth? $50/year beyond break even? $100? $500? Everybody needs to answer that for themselves, but the net "break-even" spend with hassle factored in would be something less than $35,714/year.
And another question to ask is, how much would the savings impact the rest of my life? If you have less money than you need already, then perhaps a few hundred a year would be worth the hassle. It might mean an additional road trip or that new cell phone that you cannot afford otherwise. If you have enough, and it's already working for you, why bother?
Completely agreed. Ten to fifteen minutes of analysis, partly to comfort my wife that the shift to the new system was worthwhile wasn't a lot of effort; I anticipate doing it again some years down the road when our situation changes such that we're traveling significantly less. I will continue to log cases where I get value from the card "for a while" just because I find it interesting.

We used a less-rewarding credit card pair from another institution (USAA) for many years without thinking about it. This Chase card pair (Sapphire Reserve and Freedom Unlimited) is easy for my wife to use and easy for me to redeem for greater value, so it was worth a one-time shift. We've opted to not get the Freedom card as well, for just the reasons you cite.

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

Post by TravelGeek » Wed Mar 25, 2020 12:03 pm

protagonist wrote:
Wed Mar 18, 2020 10:39 am

I don't have cable, and pay $12/month for phone service (Xfinity charges $12/Gb/mo. and I essentially never go above 1 Gb)
That would save me a grand total of $7.20/year. ($144 x .05).
The 50K would be nice but I already have over 500K and have been at about that level for 4 years. Maybe if I need more UR points I will get it some day.
We don’t have cable TV either and Google Fi apparently doesn’t earn 5X on the Chase Ink Cash. However, our fiber internet service (Centurylink) counts, and all my Amazon spend earns 5X via gift cards I buy at Staples or Office Depot. I also buy gift cards for streaming services such as Netflix and Hulu there. Admittedly those don’t really add up to much and I wouldn’t go out of my way to buy gift cards but if I am there for Amazon cards I get those as well.

Jack FFR1846
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Re: What's Your Credit Card Rewards Strategy?

Post by Jack FFR1846 » Wed Mar 25, 2020 12:34 pm

protagonist wrote:
Wed Mar 25, 2020 9:54 am

Another factor ( harder to put a monetary value on) is hassle factor....another account....another card....another credit pull...more time spent on application...more record keeping...another tax form....etc.
"Break even" is one thing, but how much is the hassle worth? $50/year beyond break even? $100? $500? Everybody needs to answer that for themselves, but the net "break-even" spend with hassle factored in would be something less than $35,714/year.
And another question to ask is, how much would the savings impact the rest of my life? If you have less money than you need already, then perhaps a few hundred a year would be worth the hassle. It might mean an additional road trip or that new cell phone that you cannot afford otherwise. If you have enough, and it's already working for you, why bother?
Depends if you find this hobby of bringing in passive income a hassle or "money for nothin'". I'm in the latter category. To me, doing taxes is a hassle and I'm more than happy to pay my CPA $285 to do it and maybe pay for it with the $10-$15k I get from Credit Card Reindeer games.
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MikeG62
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Re: What's Your Credit Card Rewards Strategy?

Post by MikeG62 » Wed Mar 25, 2020 12:51 pm

protagonist wrote:
Wed Mar 25, 2020 9:26 am
MikeG62 wrote:
Wed Mar 25, 2020 9:21 am
protagonist wrote:
Mon Mar 16, 2020 3:10 pm
I was going to move $100K of maturing CDs to Merrill in order to get the BoA Cash Rewards card with 75% premium, but I re-thought my strategy when I saw how low the return on brokered CDs was cf. the best bank/CU offers, or even with my online bank account (1.86% as of 2 days ago).

Under the circumstances I will stick with the Chase trifecta for now. (CSR+ Freedom Unl.+Freedom). It simplifies my life, and a minimum of 2.25% back on travel is pretty competitive with anything on the market.
I would not use cash (or CD’s) to get the 75% bump. I transferred assets in kind (investments) I had sitting at Fidelity. The assets would have remained at Fidelity had I not transferred to Merrill Edge invested exactly the same way.

I opened an IRA account at Merrill Edge and transferred $200,000 in shares in a bond fund I had in my IRA at Fidelity and opened a brokerage account at Merrill Edge and transferred $200,000 in shares of an equity ETF. Both accounts qualify for a $900 cash bonus after 90-days. Once the bonus posts, I will transfer the equity EFT back to Fidelity and 1/2 of the bond fund as well. I’ll then just retain $100,000 of the bond fund shares at Merrill Edge to earn the 2.625% cash back incentive.
That would work, but my only remaining fund is FFNOX, which I have held since at least the early 2000s. If I found equivalent ETFs for its components I would have a massive tax bill on the gains.
Are you sure you can't transfer shares of FFNOX?

I just logged into my Merrill Edge account and to see if I could place a buy order FFNOX and it looked like it would allow me to do so.

FWIW, I transferred shares in a bond fund which requires a minimum initial investment of $1.0 million. I got into this fund through my former employers 401K (which was subsequently rolled over into an IRA at Fidelity when I retired) where there was no such minimum. Merrill Edge had no problem accepting the transfer and said there would be no fee assessed on reinvestment of dividends either. There is only a fee if I want to purchase new shares. Long way of saying I don't think you'd have a problem transferring over $200K in shares of FFNOX. Hold for 90 days to get the transfer bonus (was $900 when I opened my account, might have changed since). After they post the bonus, transfer all but $100K back to Fidelity. Then enjoy the 2.625% in cash back on the premium rewards card going forward. Not only would you get the transfer bonus and 2.625% CB level on future purchases, but if you spend $3,000 on the card in the first 90 days you get 50,000 points, which can be applied as a statement credit ($500).

I did not find it all that much work, but I am retired so lots of time on my hands. Extra 62.5bps (above my prior general purposes CC - Fidelity VISA) on our average charges to that card translates to over $400 in incremental cash back per year. Toss on top two $900 transfer bonuses and $500 in bonus points and it's over $2,700 for maybe two hours work.
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protagonist
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Re: What's Your Credit Card Rewards Strategy?

Post by protagonist » Wed Mar 25, 2020 3:02 pm

MikeG62 wrote:
Wed Mar 25, 2020 12:51 pm
protagonist wrote:
Wed Mar 25, 2020 9:26 am
MikeG62 wrote:
Wed Mar 25, 2020 9:21 am
protagonist wrote:
Mon Mar 16, 2020 3:10 pm
I was going to move $100K of maturing CDs to Merrill in order to get the BoA Cash Rewards card with 75% premium, but I re-thought my strategy when I saw how low the return on brokered CDs was cf. the best bank/CU offers, or even with my online bank account (1.86% as of 2 days ago).

Under the circumstances I will stick with the Chase trifecta for now. (CSR+ Freedom Unl.+Freedom). It simplifies my life, and a minimum of 2.25% back on travel is pretty competitive with anything on the market.
I would not use cash (or CD’s) to get the 75% bump. I transferred assets in kind (investments) I had sitting at Fidelity. The assets would have remained at Fidelity had I not transferred to Merrill Edge invested exactly the same way.

I opened an IRA account at Merrill Edge and transferred $200,000 in shares in a bond fund I had in my IRA at Fidelity and opened a brokerage account at Merrill Edge and transferred $200,000 in shares of an equity ETF. Both accounts qualify for a $900 cash bonus after 90-days. Once the bonus posts, I will transfer the equity EFT back to Fidelity and 1/2 of the bond fund as well. I’ll then just retain $100,000 of the bond fund shares at Merrill Edge to earn the 2.625% cash back incentive.
That would work, but my only remaining fund is FFNOX, which I have held since at least the early 2000s. If I found equivalent ETFs for its components I would have a massive tax bill on the gains.
Are you sure you can't transfer shares of FFNOX?

I just logged into my Merrill Edge account and to see if I could place a buy order FFNOX and it looked like it would allow me to do so.

FWIW, I transferred shares in a bond fund which requires a minimum initial investment of $1.0 million. I got into this fund through my former employers 401K (which was subsequently rolled over into an IRA at Fidelity when I retired) where there was no such minimum. Merrill Edge had no problem accepting the transfer and said there would be no fee assessed on reinvestment of dividends either. There is only a fee if I want to purchase new shares. Long way of saying I don't think you'd have a problem transferring over $200K in shares of FFNOX. Hold for 90 days to get the transfer bonus (was $900 when I opened my account, might have changed since). After they post the bonus, transfer all but $100K back to Fidelity. Then enjoy the 2.625% in cash back on the premium rewards card going forward. Not only would you get the transfer bonus and 2.625% CB level on future purchases, but if you spend $3,000 on the card in the first 90 days you get 50,000 points, which can be applied as a statement credit ($500).

I did not find it all that much work, but I am retired so lots of time on my hands. Extra 62.5bps (above my prior general purposes CC - Fidelity VISA) on our average charges to that card translates to over $400 in incremental cash back per year. Toss on top two $900 transfer bonuses and $500 in bonus points and it's over $2,700 for maybe two hours work.
I just assumed it would be more complicated than that. I'll look into it. Thanks.

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