What's Your Credit Card Rewards Strategy?

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

Post by UpperNwGuy »

Sadly, not a single one of my nearby gas stations yet has contactless payment at the pumps. You still have to insert the card in a slot at all of them.
Jags4186
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Re: What's Your Credit Card Rewards Strategy?

Post by Jags4186 »

UpperNwGuy wrote: Wed Jun 09, 2021 6:14 am Sadly, not a single one of my nearby gas stations yet has contactless payment at the pumps. You still have to insert the card in a slot at all of them.
Most (all?) major brand gas companies have an app where you can say which pump your using and once you process payment via app the pump unlocks. You also get a discount for using the app at most places.

By me I know that Shell, BP, Exxon, and Sunoco all have this capability.
Aged Maduro
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Re: What's Your Credit Card Rewards Strategy?

Post by Aged Maduro »

None. I am now at a financial level that the mental energy and hoopjumping of playing the credit card rewards game is of little benefit.
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billthecat
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Re: What's Your Credit Card Rewards Strategy?

Post by billthecat »

Jags4186 wrote: Wed Jun 09, 2021 6:01 am
FrugalProfessor wrote: Tue Jun 08, 2021 10:25 pm
Jags4186 wrote: Tue Jun 08, 2021 5:55 am
daw007 wrote: Tue Jun 08, 2021 1:27 am
Jags4186 wrote: Tue Jun 01, 2021 10:36 am

What is of REAL interest to me is Bank of America Business Platinum Honors, but as far as I’m aware that actually requires holding $100k in cash so that’s too rich for my blood as the opportunity cost is too high for the benefit. If I had a business that required that much cash holdings, I’d be all over it.
I took a look @ the BofA Business Platinum Rewards and it didn't look super enticing to me. What am I missing?

https://www.bankofamerica.com/preferred ... alculator/
Business Cash Rewards has a $50,000 annual cap vs $2500/qt cap of the personal card. Plastiq mortgage payment codes as travel means 5.25% - 2.85% fee = 2.4% cashback on mortgage payments.
I didn't know that Plastiq coded as travel. Pretty slick! Do you have a hunch on the likelihood of this being shut down?

Also, can the same $100k parked at ME for the personal card also work for the business card (or do I need another $100k)?
It’s not that plastiq codes as travel everywhere, it just codes as travel with Bank of America on certain mortgage payments.

You need $100k in cash in a business account and a business cash rewards card. A very high bar.
Are you sure it has to be cash? It seems like you need $100k balance. If you don't want to have that much cash, then it seems like you could have $100k in investments at Merrill Edge - investments that you would have anyway elsewhere in another taxable account.

So I guess it's get the business credit card, choose "travel" as 3% category, move money to Merrill, invest and maintain the balance, pay mortgage through Plastiq, and hope they code your mortgage as travel (is that certain?).
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EnjoyIt
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Re: What's Your Credit Card Rewards Strategy?

Post by EnjoyIt »

Aged Maduro wrote: Wed Jun 09, 2021 7:34 am None. I am now at a financial level that the mental energy and hoopjumping of playing the credit card rewards game is of little benefit.
I go back and forth on how complicated I'm willing to go with this strategy, but let me throw out two examples of how it can be beneficial that keeps me coming back.

Example 1: Retired family that spends $100k/yr with a $2.5 million portfolio. By getting 5 new credit cards per year they essentially get 10% off on the spending of $25k which is a cash back of. $2,500. For the next $75k that they spend, they are able to maximize credit card rewards getting an additional 3% compared to a baseline 2% credit card. this gives them $2250. All together this family gets $4750 in rewards. This essentially converts their withdrawal rate from 4% down to 3.8%. I don't know about you, but I think that is a really big deal when living on a fixed income of one's portfolio.

Example 2: The exact same family, but instead of retired, they are still working with 20 more years left to retirement. They are in the 30% tax bracket when looking into state and federal income taxes. Credit card cash back and sign up bonuses are not taxed so in effect, they are making $6175. Since money is fungible and If they have additional pretax space, they can invest that into pre-tax accounts. If they do this for 20 years at 5% real return which is less than historic average of a 60/40 portfolio they would end up with an additional $204k in retirement. Not too shabby. If that same amount is invested in a taxable account, they would have $157k.

Keep in mind, one can do better or worse than what I described above and your millage may vary. Also, the more you spend in a year, the more cash back one would get. One can also get more than 5 credit cards per year. I simply chose 5 because it would keep a family of two within the chase 5/24 rule. Like you, I am doing pretty well financially so I eliminated as much complexity out of my strategy as I possibly could. I don't want to spend hours a year trying to convert gift cards into cash. I simply keep a few credit cards in my pocket and try to use the best one for the right expenditure and then get a new card every so often on top of that. Its pretty simple and takes almost no effort on my part.
A time to EVALUATE your jitters: | https://www.bogleheads.org/forum/viewtopic.php?f=10&t=79939&start=400#p5275418
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dodecahedron
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Re: What's Your Credit Card Rewards Strategy?

Post by dodecahedron »

EnjoyIt wrote: Wed Jun 09, 2021 9:42 am
Aged Maduro wrote: Wed Jun 09, 2021 7:34 am None. I am now at a financial level that the mental energy and hoopjumping of playing the credit card rewards game is of little benefit.
I go back and forth on how complicated I'm willing to go with this strategy, but let me throw out two examples of how it can be beneficial that keeps me coming back.

Example 1: Retired family that spends $100k/yr with a $2.5 million portfolio. By getting 5 new credit cards per year they essentially get 10% off on the spending of $25k which is a cash back of. $2,500. For the next $75k that they spend, they are able to maximize credit card rewards getting an additional 3% compared to a baseline 2% credit card. this gives them $2250. All together this family gets $4750 in rewards. This essentially converts their withdrawal rate from 4% down to 3.8%. I don't know about you, but I think that is a really big deal when living on a fixed income of one's portfolio.

Example 2: The exact same family, but instead of retired, they are still working with 20 more years left to retirement. They are in the 30% tax bracket when looking into state and federal income taxes. Credit card cash back and sign up bonuses are not taxed so in effect, they are making $6175. Since money is fungible and If they have additional pretax space, they can invest that into pre-tax accounts. If they do this for 20 years at 5% real return which is less than historic average of a 60/40 portfolio they would end up with an additional $204k in retirement. Not too shabby. If that same amount is invested in a taxable account, they would have $157k.

Keep in mind, one can do better or worse than what I described above and your millage may vary. Also, the more you spend in a year, the more cash back one would get. One can also get more than 5 credit cards per year. I simply chose 5 because it would keep a family of two within the chase 5/24 rule. Like you, I am doing pretty well financially so I eliminated as much complexity out of my strategy as I possibly could. I don't want to spend hours a year trying to convert gift cards into cash. I simply keep a few credit cards in my pocket and try to use the best one for the right expenditure and then get a new card every so often on top of that. Its pretty simple and takes almost no effort on my part.
Strongly agree with the sentences I have bolded and underlined in the quote above, particularly "[T]he more you spend in a year, the more cash back one would get." I frequently remind myself that the avoidance of unnecessary superfluous spending that would yield me little or no utility is worth far more than bonus points.

I recently got a new credit card (my first new one since 2019) after first setting my post-Pandemic vaccination priority spending plans and realizing that I had genuine value for the signup rewards my chosen new card would generate (Amtrak points) for a relatively modest spend ($1,000 in first three months) in categories I was planning to do in any case this summer.

I am not interested in coming anywhere close to bumping up against Chase 5/24 and/or BoA 2/3/4 rules or churning cards.
EnjoyIt
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Re: What's Your Credit Card Rewards Strategy?

Post by EnjoyIt »

dodecahedron wrote: Wed Jun 09, 2021 9:55 am
EnjoyIt wrote: Wed Jun 09, 2021 9:42 am
Aged Maduro wrote: Wed Jun 09, 2021 7:34 am None. I am now at a financial level that the mental energy and hoopjumping of playing the credit card rewards game is of little benefit.
I go back and forth on how complicated I'm willing to go with this strategy, but let me throw out two examples of how it can be beneficial that keeps me coming back.

Example 1: Retired family that spends $100k/yr with a $2.5 million portfolio. By getting 5 new credit cards per year they essentially get 10% off on the spending of $25k which is a cash back of. $2,500. For the next $75k that they spend, they are able to maximize credit card rewards getting an additional 3% compared to a baseline 2% credit card. this gives them $2250. All together this family gets $4750 in rewards. This essentially converts their withdrawal rate from 4% down to 3.8%. I don't know about you, but I think that is a really big deal when living on a fixed income of one's portfolio.

Example 2: The exact same family, but instead of retired, they are still working with 20 more years left to retirement. They are in the 30% tax bracket when looking into state and federal income taxes. Credit card cash back and sign up bonuses are not taxed so in effect, they are making $6175. Since money is fungible and If they have additional pretax space, they can invest that into pre-tax accounts. If they do this for 20 years at 5% real return which is less than historic average of a 60/40 portfolio they would end up with an additional $204k in retirement. Not too shabby. If that same amount is invested in a taxable account, they would have $157k.

Keep in mind, one can do better or worse than what I described above and your millage may vary. Also, the more you spend in a year, the more cash back one would get. One can also get more than 5 credit cards per year. I simply chose 5 because it would keep a family of two within the chase 5/24 rule. Like you, I am doing pretty well financially so I eliminated as much complexity out of my strategy as I possibly could. I don't want to spend hours a year trying to convert gift cards into cash. I simply keep a few credit cards in my pocket and try to use the best one for the right expenditure and then get a new card every so often on top of that. Its pretty simple and takes almost no effort on my part.
Strongly agree with the sentences I have bolded and underlined in the quote above, particularly "[T]he more you spend in a year, the more cash back one would get." I frequently remind myself that the avoidance of unnecessary superfluous spending that would yield me little or no utility is worth far more than bonus points.

I recently got a new credit card (my first new one since 2019) after first setting my post-Pandemic vaccination priority spending plans and realizing that I had genuine value for the signup rewards my chosen new card would generate (Amtrak points) for a relatively modest spend ($1,000 in first three months) in categories I was planning to do in any case this summer.

I am not interested in coming anywhere close to bumping up against Chase 5/24 and/or BoA 2/3/4 rules or churning cards.
My spouse and I have a strategy to not waste money. If we want something, the more expensive it is, the longer we need to wait to decide if we really want it. This keeps us from doing rash impulse purchases that purchase no value. Want a new bike for $1,500, no problem figure out what bike you want and then sit on it for 1-2 weeks. If you still want it, then let's get it, no problem. Want a slice of pizza for $2, no waiting needed just buy it. Want to upgrade cars? Choose the car and then wait 45 days. If this is really the car you want, then you'll still want it in 45 days.

We still make some silly purchases, but they are far fewer once we implemented this technique.
A time to EVALUATE your jitters: | https://www.bogleheads.org/forum/viewtopic.php?f=10&t=79939&start=400#p5275418
Jags4186
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Re: What's Your Credit Card Rewards Strategy?

Post by Jags4186 »

Citi has launched a new card called Custom Cash today. It has a $200/20,000 TYP signup bonus after spending $750 in 3 months. You earn 5%/5 TYP on your top spending category up to $500/mo each month. If you also have a Rewards+ card, you can increase that redemption rate to 5.5%/5.5 TYP.

I had my wife sign up today. This is going to become my new grocery card and I anticipate finally retiring my AMEX Gold unless I get a significant retention offer that outweighs the annual fee. I also think I will attempt to convert my Costco Visa to this card to double the throughput to $1000/mo. The Costco Visa serves no purpose in my wallet anymore.
czaj
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Re: What's Your Credit Card Rewards Strategy?

Post by czaj »

Jags4186 wrote: Thu Jun 10, 2021 11:48 am Citi has launched a new card called Custom Cash today. It has a $200/20,000 TYP signup bonus after spending $750 in 3 months. You earn 5%/5 TYP on your top spending category up to $500/mo each month. If you also have a Rewards+ card, you can increase that redemption rate to 5.5%/5.5 TYP.

I had my wife sign up today. This is going to become my new grocery card and I anticipate finally retiring my AMEX Gold unless I get a significant retention offer that outweighs the annual fee. I also think I will attempt to convert my Costco Visa to this card to double the throughput to $1000/mo. The Costco Visa serves no purpose in my wallet anymore.
Not bad for a dedicated card for groceries. Finally a nice replacement for the old Sallie Mae Barclaycard, but an even higher limit.

This is also similar to the new Venmo card. If only they had a category that would include tax payments.
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msi
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Re: What's Your Credit Card Rewards Strategy?

Post by msi »

Jags4186 wrote: Thu Jun 10, 2021 11:48 am Citi has launched a new card called Custom Cash today. It has a $200/20,000 TYP signup bonus after spending $750 in 3 months. You earn 5%/5 TYP on your top spending category up to $500/mo each month. If you also have a Rewards+ card, you can increase that redemption rate to 5.5%/5.5 TYP.

I had my wife sign up today. This is going to become my new grocery card and I anticipate finally retiring my AMEX Gold unless I get a significant retention offer that outweighs the annual fee. I also think I will attempt to convert my Costco Visa to this card to double the throughput to $1000/mo. The Costco Visa serves no purpose in my wallet anymore.
It also beats Amex Blue Cash Preferred for groceries, even if you spend the $6k max.
fareastwarriors
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Re: What's Your Credit Card Rewards Strategy?

Post by fareastwarriors »

Jags4186 wrote: Thu Jun 10, 2021 11:48 am Citi has launched a new card called Custom Cash today. It has a $200/20,000 TYP signup bonus after spending $750 in 3 months. You earn 5%/5 TYP on your top spending category up to $500/mo each month. If you also have a Rewards+ card, you can increase that redemption rate to 5.5%/5.5 TYP.

I had my wife sign up today. This is going to become my new grocery card and I anticipate finally retiring my AMEX Gold unless I get a significant retention offer that outweighs the annual fee. I also think I will attempt to convert my Costco Visa to this card to double the throughput to $1000/mo. The Costco Visa serves no purpose in my wallet anymore.

Wish it was more than $500 per month.
Jags4186
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Re: What's Your Credit Card Rewards Strategy?

Post by Jags4186 »

fareastwarriors wrote: Thu Jun 10, 2021 1:36 pm
Jags4186 wrote: Thu Jun 10, 2021 11:48 am Citi has launched a new card called Custom Cash today. It has a $200/20,000 TYP signup bonus after spending $750 in 3 months. You earn 5%/5 TYP on your top spending category up to $500/mo each month. If you also have a Rewards+ card, you can increase that redemption rate to 5.5%/5.5 TYP.

I had my wife sign up today. This is going to become my new grocery card and I anticipate finally retiring my AMEX Gold unless I get a significant retention offer that outweighs the annual fee. I also think I will attempt to convert my Costco Visa to this card to double the throughput to $1000/mo. The Costco Visa serves no purpose in my wallet anymore.

Wish it was more than $500 per month.
Agreed, but the limit means the card is likely to stick around. If you have a spouse you can each have one raising your throughput to $1000/mo. We typically spend about $700-$800/mo at the grocery store and I’m sure we can add in a gift card to something here or there to get to $1000/mo.
manuvns
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Re: What's Your Credit Card Rewards Strategy?

Post by manuvns »

i sign up for 3-5 rewards card once in 2 years , 0% 15-18 months , 100k miles bonus , ... once i have used and run out of 0% promo bonus i repeat the same strategy .

my 4 cards for next round are :

0% for 15 month Bof A cash reward alonf with 200$ in rewards after 500$ spend
0% for 15 month capital one venture card along with 200$ rewards bonus
discover card 0% for 15 monnths
cahse sapphire 100k sign up bonus , 95$ annual fees
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FrugalProfessor
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Re: What's Your Credit Card Rewards Strategy?

Post by FrugalProfessor »

billthecat wrote: Wed Jun 09, 2021 9:14 am So I guess it's get the business credit card, choose "travel" as 3% category, move money to Merrill, invest and maintain the balance, pay mortgage through Plastiq, and hope they code your mortgage as travel (is that certain?).
I was hoping to test out the Plastiq mortgage coding with one of my six (5 cash rewards + 1 premium rewards) existing BoA credit cards before doing anything drastic (another $100k to Merrill, open up new card, etc), but alas all of my existing cards are Visas. Plastiq prohibits mortgage payments with Visas. If you happened to have an existing BoA Mastercard cash rewards card, it would seem to be pretty easy to send a $1 mortgage payment via Plastiq and see how it codes. If it codes as travel, then you're seemingly good to go. If not, you abort.

My mortgage servicer is Mr Cooper if anyone has data on how that codes with Plastiq. I tried google but came up empty.
billthecat wrote: Wed Jun 09, 2021 9:14 am Are you sure it has to be cash? It seems like you need $100k balance. If you don't want to have that much cash, then it seems like you could have $100k in investments at Merrill Edge - investments that you would have anyway elsewhere in another taxable account.
FYI, here's what dodecahedron says about the separate $100k in investments, consistent with your intuition:
dodecahedron wrote: Wed Jun 09, 2021 1:31 am No, you need $100K in a Merrill Business Investment Acct and/or BoA Business Checking Acct to qualify for Business Preferred Rewards.
I blog. Taxes are the lowest hanging source of alpha. I eat tax alpha for breakfast.
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