Credit Cards with high point rewards

[RossMAN]

Yeah - I use CK for daily credit pulls, but have never really bothered to look at any of their other offerings or analysis tools. Only problem is that the CK site has my score 60 points below my actual FICO.. lol.

Yeah, a lot of people don't consider using CK for custom tailored offers which is unique compare to your average cookie cutter credit card comparison site.

Even with my mediocre credit score (around 780), I've seen some pretty enticing offers.

 

[Triumph]

just got a letter in the mail from BofA today, offering me $400 cash back if I spend $500 in the next 90 days. I opened 3 credit cards just 3 months ago for the same reason (introductory cash back) and I see myself opening up a 4th. This is by far the hottest intro deal I've seen.

 

[RossMAN]

just got a letter in the mail from BofA today, offering me $400 cash back if I spend $500 in the next 90 days. I opened 3 credit cards just 3 months ago for the same reason (introductory cash back) and I see myself opening up a 4th. This is by far the hottest intro deal I've seen.

I wish they'd send me a letter like that.

So you spend $500 in the next 90 days and they give you a $400 credit? Nice!

 

[Triumph]

I wish they'd send me a letter like that.

So you spend $500 in the next 90 days and they give you a $400 credit? Nice!

That's what it says! It also came with a code for the website, so I'm guessing it's not just an open offer. I looked at the fine print - no annual fee, no "must keep card open for 1 year", nothing else. I have good credit and already took out a mortgage so I am not worried about a credit hit.

 

[Vdubchaos]

Not always the case...

Also for those that have to float a balance, getting points is better than no points.

ALWAYS the case

Depending on the balance, once the interest kicks in, it will be more $$ then the Rewards you get back.

It's the reason why Banks love "rewards", most people don't pay off their balance every month and end up paying more interest than rewards are worth.

 

[bignateyk]

I have a Chase Sapphire that I use as my standard card, but I sign up for cards to claim the bonuses quite frequently and then cancel them before the year is up to avoid the annual fees.

For example, you can sign up for a Chase United Explorer card to get 65K frequent flyer miles, and then sign up for a Chase Sapphire Preferred to get 40K points that you can transfer directly to your United Frequent Flyer account. To get those bonuses you need to spend about 30K (which we would do anyway), so 65K + 40K + 30K = 135K. You only need 150K to get two round trip international tickets.

Two good international tickets (to Australia, for example), will run about $4000 at least. YOu would only need to spend another 15K to get the remaining mileage needed (or in my case I have those miles already from other flights). For me it works out to be better than a 10% return.

 

[alkemyst]

ALWAYS the case

Depending on the balance, once the interest kicks in, it will be more $$ then the Rewards you get back.

It's the reason why Banks love "rewards", most people don't pay off their balance every month and end up paying more interest than rewards are worth.

Not true. If you are 'carrying a balance' more than a couple months or chronically sure.

I pay far less in two months interest than the points I earn. I normally don't carry anything more than 2 months.

 

[Train]

Not true. If you are 'carrying a balance' more than a couple months or chronically sure.

I pay far less in two months interest than the points I earn. I normally don't carry anything more than 2 months.

I can't think of any scenario where this would be true, especially taking into account minimum finance charge. Can you give us an example using actual numbers?

 

[Train]

I guess I could see it working, once I remembered the APR is only applied a month at a time. Also factor in minimum payment, and the redemption of the cash back itself.

$1000 charged, at 5% cashback, nets you $50 in your cash back account.

Even at a high rate of 24.99%, the $1000 carried for 2 months, assuming a $10 min payment, only yeilds $21.45 in interest, still below your $50 earned.

And if you redeem the $50 after the first month, your total interest would be even less. Bump your payment up to $100 and your'e not doing bad at all.

Not ideal, but if you absolutely have to carry a balance, it's still better than earning less than 1% back on a low interest card and carrying it for the same amount of time.

 

[alkemyst]

thank you for doing the math.

Also with good credit I have found many points cards are very close to the best rates today (not counting introductory rates).

Long gone are the days of 5-6% fixed rate cards with $50k+ limits.

 

[Train]

Ya my cb cards are only 11.99%, 14.99%, and 17.24%, have never carried a balance on any of them (except when I had 0% intro rates)

My "backup" card is 8.90%, but I'd be lucky to get 0.75% back on a purchase.

That being said, if I had to make a large unplanned purchase, I would
1) use the card with the best cash back for that purchase (paying attention to limits)
2) if more than one card has the same cash back, use the one furthest from its next closing date
3) adjust budget to absorb larger than normal CC bill
4) pull money out of savings to make up for any budget shortfall, to pay it off by the due date
5) continue with modified budget until money taken out of savings is replaced

 

[alkemyst]

Only 14.99 and 17.24? lol.

My cards and wife's break out like this and none have any kind of annual fee:
Department store cards:22.99% (Home Depot), 3@25.4% (Sears) and 26.99% JC Penney. These are mostly good for 'coupons' and special card holder deals. I never would carry a balance at these rates. Sears Visa (or Mastercard I forget) is good for 0% balance transfers/cash advances (3% hit) at times and I have a $5,700 limit with them on one card that offers those (about $15000 combined).

My ghetto bank Chase card is at 17.27% around $5000 available, decent points and a lot of benefits at Buy.Com originally. They have since changed the program and the points are better than the buy.com deals. Only problem is they require you to manage your point return and it's variable. When it's 5% on gas or groceries I rack it up...it's free money.

My next tier are all 13.99% with about $22,000 available. Only one is a points card, but it's main advantage is the send lots of 0% transfer checks. One in this category used to be about half that rate and have a limit of around $25k by itself until my mortgage company screwed up my payments.

Then I have American Express Blue at 12.24 and my Citi Plat Dividend card at 10.74%. The Citi 'points' are crap. The Amex are pretty damn good. I will float a balance here and cash in well at times. They directly link to your Amazon account as well making point usage cheap (it's not a great point to buck ratio, but convenient).

Finally my 'stars'. These are weak sauce compared to what I had (5-6% with over $50k of credit line FIXED), but great today. 7.24 on a citi Thank you card (points but their store only which is marked up) and 6.99 on a Citi Preferred which while doesn't have points is AWESOME for concerts and tickets. I am sitting in the $2500 seat section for the Motley Crue / Kiss concert coming up. I don't get the 'Meet the Band' package, but that is fine with me. Some of the time you can get 'rounded up' and partake of it (I haven't been lucky in that yet, but again I don't really care to do the cattle car 'Meet the Band' deal.

The sad thing just breaking this out is I realize my credit power used to be close to $150-200k (this was prior to the 'boom' even)...now it's 1/2-1/4 that.

I don't track my cards so deeply to know closing dates and the like. I do know the cards I pay the first half and last half of the month. Most of my cards if I have been allowed I set up at the first half. I personally like all my expenses due around the same time and then know the rest of the month is gravy. I couldn't always do that though. I do believe some of my cards are on a 20 day cycle and have been burned paying a 'month' interest at times.