Killer Credit Card Rewards

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ipoplaya_IHB

ipoplaya_IHB

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<p>Was curious what kind of credit card rewards people are getting. I am using a Fidelity Mastercard (2% on all charges, capped at $1500 per year) and a Fidelity Amex (1.5% on all charges, capped at $1500 per year) that contribute reward dollars directly to Fidelity 529 plans. Has anyone seen anything better than this?</p>
 
IR- I use credit cards. I am also rewarded by not paying interest since I always pay my balance in full. But I still receive the benefit of all of the reward points and cash back that I get simply for using the card. One does not need to carry a balance to receive the rewards.



I'm curious, what is your reason for not doing this? Am I not seeing something?
 
<p>Short-sighted IMHO IR. By not using them you are passing up on free money... I haven't paid any credit card interest in probably 8-9 years but have charged the heck out of my cards. I accumulated enough miles back to fund free honeymoon airfare to Jamaica and two separate free Hawaiian vacation airfares for the wife and I. My kids are getting an extra $1500 per year in their 529 plans by charging everything today, again with no interest at all paid, which with compounding at a rate of only 5% will mean over $40K by the time they go to school.</p>

<p>So, you don't pay any interest, I don't pay any interest, but the method I use to make my purchases makes my family worth $80K more over the next 18 years all other things being equal. Seriously, you should think about that... I think not using credit cards to get free after-tax rewards is just as bad, if not worse, than not deferring enough 401k to get the max match from a company. Those rewards are tax-free my friend. $1500 tax-free is going to be more like $2000-2500 in equivalent wage earnings. Why pass up on that? </p>
 
<p class="MsoNormal">What cards are offering these reward and cash back? I opened up an Amex Blue card, which promised all kinds of rewards. Thus far I’ve earned a $50 Banana Republic gift card and $25 Barnes & Noble gift card. The card has been opened over 5 years. How much do you need to charge in order to receive Jamaican holidays and Hawaii vacation packages? </p>
 
A lot. we charge anywhere from 2500-4K a month and pay it in full (no interest for me either). We get two free tickets a year since we usually hit the 50K point thresh hold in a year.
 
<p>Here you go tenmag. These are what I use, but the rewards go direct to 529 savings plan, so if you don't have kids, they wouldn't be for you:</p>

<p><a href="http://personal.fidelity.com/products/checking/content/mcplatplus.shtml.cvsr">http://personal.fidelity.com/products/checking/content/mcplatplus.shtml.cvsr</a></p>

<p>The rewards get contributed quarterly. What we do is charge heavily on one card and when we hit the cap on it, change over to the other card and charge it to the reward cap I started using Fidelity cards when they still offered a mastercard with a 2% reward rate. They stopped making that one available to new customers. I think too many were probably hitting the cap each year...</p>
 
IR rolls old school. no cc's, no wallet, not even one of those money clips which are becoming trendy. cash in a roll. big fazools on the outside.





i think IR's point, which many studies have indicated, is that credit cards lead to excess spending. it might be impossible to avoid them in this day and age, but to the extent you can, it just might provide far more rewards than you earn back. if you give a person a $5 bill and credit card, then send them into a store to purchase food, they will often come out with items that cost under $5. send the person in with only a credit card and its not surprising that they spend far more. its not a surprise the national savings rate has plummeted as cc use has become more commonplace.





the credit card companies are not in the business of losing money. it's no different than any deals a casino might offer you in blackjack -- insurance, even money if you have bj and dealer showing an ace. they wouldn't offer it to you if it wasn't more profitable for them. credit card companies know (whether you realize it or not) that rewards will induce you to use your cc more often and that whatever rewards they're giving you ultimately helps their bottom line, not yours.





having said all that, there are some people who can and do game the credit card rewards and that probably includes some of you here. for ex, arbitraging balance transfers has been discussed here before. more power to you guys, but overall its probably more of a win-win for the credit card companies than the avg consumer.
 
I was not being completely honest. I do carry one credit card which I use on very rare occasions and pay off immediately. Keeping at least one credit line and paying it off promptly does boost a credit score which will become important when I want to qualify for a home loan. As acpme pointed out, the risks of leaving a balance and being charged fees and interest outweigh the benefits of participating in rewards programs for the vast majority of users. If this was not the case, credit card companies would not offer the programs. Think about it...
 
I always discourage people from using credit cards. There is probably 2% of the population who has the discipline to do what ipoplaya does, and 80% of the population thinks they are in that 2%...
 
<p>We use an Amex Platinum card for everything we purchase --- everything. Balance is paid off in full every month. We pull our points out pretty regularly for shopping gift cards --- mostly from The Gap --- and use it at Gap Kid's for our daugther. I honestly can't recall the last time we paid cash for an item of clothing for her, which can be a considerable expense for a growing child. </p>

<p>Access to the airline club lounges is also a nice perk, since I do a fair amount of traveling. And you get free companion airline tickets with Amex Plat as well, but that's of more questionable value, since sometimes you can find cheaper deal purchasing outright. That 529 Amex from Fidelity sounds interesting.</p>
 
<p>I would think you would be in that disciplined 2%, IR ;). I have paid interest only a few times in my life (hectic college days), and haven't done so in over 9 years. I have never been enticed by a rewards program to get a card, but I recently became aware of the program for the one CC I routinely use. I found out I have enough points for over $600 in gift cards from my choice of chains, which would cover a few years of Christmases and birthdays in my household. I think acpme's comments are closer to the truth...that I'm more likely to buy things if I have a credit card than if I have cash. Bad for my net worth, but it still doesn't help my bank's bottom line any. Since I'm not working now, I've more or less resolved to use my debit card whenever possible, since it forces me to stop and think about the balance in my checking before I buy anything.</p>
 
<p>Agree with both of you re your points about cards leading to spending and whether or not people have the discipline to handle cards. I figured you IR were one that had such discipline considering you are financially-minded so I am surprised you would pass up on giving yourself a raise. </p>

<p>If there are bunch of people that can't control their spending enough and that allows my kids to bank an extra $3K per year total toward college with absolutely zero cost and zero effort on my part, I say a hardy thank you to the masses. I hope those people keep spending like crazy and paying big interest so I can keep pimpin' those cards. </p>

<p>I think it's crazy for a financially secure and budget savvy family not to use rewards cards, but I'm less conservative than you IR. </p>

<p>Call me crazy IR, but I am planning to max my HELOC, park that cash in the bank, then refi my ARM and HELOC into a 3/1 interest only. I want to warchest the cash just in case the credit union decides they want to do away with my HELOC down the line. Right now, savings rates in some places are actually higher than the short-term mortgage rates I could obtain. The refi will protect me from my August reset, buying three years in the event we needed to stay put for that long. I'm hopeful that I will be able to arbitrage a little gain each month as a result but worst case I am protecting access to the cash and paying a half point or so after tax. OMG, IPO is adding to his debt!</p>

<p> </p>
 
I have a Macy's card that also doubles as VISA CC. The interest rate on it is horrible and I pay it off monthly. But I like my Macy's card because I buy 80% of my cloths there, and I keep their 20% off coupons in my wallet.





Does anyone know of a CC that offers Airline miles for Asian airlines, like Singapore or EVA?






 
<p>momopi - if you had a Delta Skymiles card from Amex, you would accumulate miles with Delta. They have reward redemption partnership with Singapore.</p>
 
Prior to getting married, I paid cash for everything, even rent. I had stacks of receipts all over my apartment. But I was also operating in a cash-only world with no paystubs, no taxes, and no credit card. When I met my wife and it became clear that she was completely anal about paying bills and balancing accounts, we opened one joint CC, I dumped most of my money into a joint checking account, we both use the CC to pay almost every bill we have and she pays off the balance every month. Going her route, we get free nights at HIE several times a year which is much better than shoeboxes full of receipts. I'm with IR though, given a choice, I'd rather carry $20 on me and not worry about accidental interest.
 
I have four cards because it is more convenient for me to separate personal and business expenditures. For each, I have an AMEX and a MC/VISA. The best I have found is my AMEX Platinum Cash Rebate, which returns 1.5% with no cap. I have heard good things about AMEX Blue, which if you got when it first came out was returning 2% or something like that. I'm not sure the offers are as good nowadays. There are several websites that track good deals on credit cards, they're easy to find.



IR, it really is free money you're passing up on, unless you really do think you'd spend more by using a credit card rather than cash. By putting things like our cellphone and cable charges onto credit cards, we rack up rebates quickly. I have over $100k credit to access on my cards and have never felt the urge to spend it just because it was there.



Oh, and I've never carried a balance in my life (except once by accident when I was on vacation and missed a bill).
 
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