What's Your Credit Card Rewards Strategy?

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Mudpuppy
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Re: Favorite Credit Cards

Post by Mudpuppy »

Da5id wrote: Sun Feb 14, 2021 8:37 pm
FedGuy wrote: Sun Feb 14, 2021 7:36 pmThis thus becomes a 1.99% cash back credit card unless you get your cash back in some other form, such as a deposit to your bank account.

(You can't actually cash out a single dollar due to minimum redemption requirements, but you get the point.)
I've known this forever and never cared enough to link my bank account. For most people I'm guessing the 0.01% difference is less than a cup of coffee per year so.... Mind you I don't use mine much as Chase Freedom Unlimited gives 2.25% after transfer to CSR.
If you use the same bank account to pay the Double Cash bill every month, it automatically links the option to redeem a reward into a bank account to the account used for paying the bill after two or three payments. Or at least it did for me when I got my Double Cash card.
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MilleniumBuc
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Re: Favorite Credit Cards

Post by MilleniumBuc »

Mudpuppy wrote: Mon Feb 15, 2021 10:56 pm
Da5id wrote: Sun Feb 14, 2021 8:37 pm
FedGuy wrote: Sun Feb 14, 2021 7:36 pmThis thus becomes a 1.99% cash back credit card unless you get your cash back in some other form, such as a deposit to your bank account.

(You can't actually cash out a single dollar due to minimum redemption requirements, but you get the point.)
I've known this forever and never cared enough to link my bank account. For most people I'm guessing the 0.01% difference is less than a cup of coffee per year so.... Mind you I don't use mine much as Chase Freedom Unlimited gives 2.25% after transfer to CSR.
If you use the same bank account to pay the Double Cash bill every month, it automatically links the option to redeem a reward into a bank account to the account used for paying the bill after two or three payments. Or at least it did for me when I got my Double Cash card.
And by the same token, if you change bank accounts and close the old one, the account for the rewards also takes 2-3 months to update and will show the old account. I chatted with customer service and there is no other way to change it, you have to wait and be careful not to forget and request the redemption into your old bank account.
Pepper11
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Re: What's Your Credit Card Rewards Strategy?

Post by Pepper11 »

The 4% Amazon deal expired and now back to Citi Double. Anything new out there?
Barefootgirl
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Re: What's Your Credit Card Rewards Strategy?

Post by Barefootgirl »

What card do you use for purchases on Amazon?

Considering abandoning my Amazon Synchrony card due to very poor customer service/no purchase protection. Not worth debating the details of my experience with them. Not worth the 5% rebate.

thanks
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Da5id
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Re: What's Your Credit Card Rewards Strategy?

Post by Da5id »

Barefootgirl wrote: Sat Mar 06, 2021 10:04 am What card do you use for purchases on Amazon?

Considering abandoning my Amazon Synchrony card due to very poor customer service/no purchase protection. Not worth debating the details of my experience with them. Not worth the 5% rebate.

thanks
[OT comment removed by admin LadyGeek]

Before that, I used a combination of my Chase 5% Prime card, Chase Freedom when quarterly category was Amazon, and Amazon Gift cards purchased with Chase Freedom from supermarkets when that was the category. Back when I had the 6% Amex supermarket discount I used that for Amazon gift cards. Most of those don't address your purchase protection issue tho.
Cruise
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Re: What's Your Credit Card Rewards Strategy?

Post by Cruise »

Da5id wrote: Sat Mar 06, 2021 10:13 am
Barefootgirl wrote: Sat Mar 06, 2021 10:04 am What card do you use for purchases on Amazon?

Considering abandoning my Amazon Synchrony card due to very poor customer service/no purchase protection. Not worth debating the details of my experience with them. Not worth the 5% rebate.

thanks
[OT comment removed by admin LadyGeek]
Have you found a substitute, and can you please reveal? Thanks!
Da5id
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Re: What's Your Credit Card Rewards Strategy?

Post by Da5id »

Cruise wrote: Sat Mar 06, 2021 10:56 am
Da5id wrote: Sat Mar 06, 2021 10:13 am
Barefootgirl wrote: Sat Mar 06, 2021 10:04 am What card do you use for purchases on Amazon?

Considering abandoning my Amazon Synchrony card due to very poor customer service/no purchase protection. Not worth debating the details of my experience with them. Not worth the 5% rebate.

thanks
[OT comment removed by admin LadyGeek]
Have you found a substitute, and can you please reveal? Thanks!
There is no one substitute I've found. I've used Walmart.com for a few things, shopped around for others. I still use Amazon to look at peoples reviews and find products sometimes, I just buy them elsewhere. I also still have to use Amazon with my kindle, as my library uses Amazon's service. But I don't buy books in general (use library), so not a big issue.
TravelGeek
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Re: What's Your Credit Card Rewards Strategy?

Post by TravelGeek »

Barefootgirl wrote: Sat Mar 06, 2021 10:04 am What card do you use for purchases on Amazon?

Considering abandoning my Amazon Synchrony card due to very poor customer service/no purchase protection. Not worth debating the details of my experience with them. Not worth the 5% rebate.
Most of the time I use my Amazon gift card balance to pay for purchases (unless I want extended warranty/purchase protection from a particular credit card, but that is rare).

The gift card balance is maintained with gift cards I buy with my Ink Cash at office supply stores (earns 5X UR) or during COVID at grocery stores with other cards that offered temporary 5X grocery earnings.
manlymatt83
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Re: What's Your Credit Card Rewards Strategy?

Post by manlymatt83 »

TravelGeek wrote: Sat Mar 06, 2021 11:24 am
Barefootgirl wrote: Sat Mar 06, 2021 10:04 am What card do you use for purchases on Amazon?

Considering abandoning my Amazon Synchrony card due to very poor customer service/no purchase protection. Not worth debating the details of my experience with them. Not worth the 5% rebate.
Most of the time I use my Amazon gift card balance to pay for purchases (unless I want extended warranty/purchase protection from a particular credit card, but that is rare).

The gift card balance is maintained with gift cards I buy with my Ink Cash at office supply stores (earns 5X UR) or during COVID at grocery stores with other cards that offered temporary 5X grocery earnings.
I abandoned my Amazon Synchrony card as well last year. It wasn't worth the hassle. Customer service was awful, they almost misprocessed one of my payments... as TravelGeek mentioned, there are definitely ways to top off once in a while to maintain the 5%.
CDub
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Re: What's Your Credit Card Rewards Strategy?

Post by CDub »

Barefootgirl wrote: Sat Mar 06, 2021 10:04 am What card do you use for purchases on Amazon?

Considering abandoning my Amazon Synchrony card due to very poor customer service/no purchase protection. Not worth debating the details of my experience with them. Not worth the 5% rebate.

thanks
I use the chase prime 5% card. If you buy enough I would think the 5% would pay off more than the purchase protection....no?
In what cases are people filing for purchase protection?
stevekozak2
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Re: What's Your Credit Card Rewards Strategy?

Post by stevekozak2 »

My credit card rewards strategy is to not use a credit card. I get rewarded every month by not getting a credit card bill. Pretty sweet!!!
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birdog
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Re: What's Your Credit Card Rewards Strategy?

Post by birdog »

stevekozak2 wrote: Sun Mar 07, 2021 7:29 am My credit card rewards strategy is to not use a credit card. I get rewarded every month by not getting a credit card bill. Pretty sweet!!!
You pay the higher cost that merchants charge everyone to offset the credit card fees they have to pay, but you prevent yourself from getting the rewards (cash back, travel points) that come from using credit cards. Not to mention the 3 to 4 week float, purchase protection and other benefits that comes from using credit cards. Credit cards aren't for everyone, though. Many get themselves in trouble with them. I seriously doubt many frequenters of this site do, however.
stevekozak2
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Re: What's Your Credit Card Rewards Strategy?

Post by stevekozak2 »

birdog wrote: Sun Mar 07, 2021 7:33 am
stevekozak2 wrote: Sun Mar 07, 2021 7:29 am My credit card rewards strategy is to not use a credit card. I get rewarded every month by not getting a credit card bill. Pretty sweet!!!
You pay the higher cost that merchants charge everyone to offset the credit card fees they have to pay, but you prevent yourself from getting the rewards (cash back, travel points) that come from using credit cards. Not to mention the 3 to 4 week float, purchase protection and other benefits that comes from using credit cards. Credit cards aren't for everyone, though. Many get themselves in trouble with them. I seriously doubt many frequenters of this site do, however.
I don't knock anyone who uses credit cards, and I know that most people do. I am just happier without them. Out of curiosity, do you know anyone who has gotten wealthy through getting rewards from a credit card?
Workaholic
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Re: What's Your Credit Card Rewards Strategy?

Post by Workaholic »

stevekozak2 wrote: Sun Mar 07, 2021 7:43 am
birdog wrote: Sun Mar 07, 2021 7:33 am
stevekozak2 wrote: Sun Mar 07, 2021 7:29 am My credit card rewards strategy is to not use a credit card. I get rewarded every month by not getting a credit card bill. Pretty sweet!!!
You pay the higher cost that merchants charge everyone to offset the credit card fees they have to pay, but you prevent yourself from getting the rewards (cash back, travel points) that come from using credit cards. Not to mention the 3 to 4 week float, purchase protection and other benefits that comes from using credit cards. Credit cards aren't for everyone, though. Many get themselves in trouble with them. I seriously doubt many frequenters of this site do, however.
I don't knock anyone who uses credit cards, and I know that most people do. I am just happier without them. Out of curiosity, do you know anyone who has gotten wealthy through getting rewards from a credit card?
I doubt anyone has "gotten wealthy" from using rewards credit cards however many people have gotten real value from utilizing rewards cards. Just from my own excel chart, my total value in dollars that I would have otherwise spent is right around $25,000. Not exactly chump change and this also isn't from some first-class seats that I wouldn't have paid $10,000 for in the first place. Mainly from exploiting value from Hyatt, utilizing United's explorist perk internationally, as well as stacking promotions.
Barefootgirl
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Re: What's Your Credit Card Rewards Strategy?

Post by Barefootgirl »

Yes, Hyatt...wow. I received 61, yes 61, free nights from them in 2020.
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Re: What's Your Credit Card Rewards Strategy?

Post by Barefootgirl »

Thank you for the suggestion to fund my future Amazon purchases (trying to wean myself from Amazon) using top offs to the account.

Mini rant - the Synchrony card does not operate like a traditional credit card where the bank has a relationship with the card holder. Synchrony apparently is just an arm of Amazon, so their bigger interests are with Amazon, screw the consumer.
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Da5id
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Re: What's Your Credit Card Rewards Strategy?

Post by Da5id »

stevekozak2 wrote: Sun Mar 07, 2021 7:43 am
birdog wrote: Sun Mar 07, 2021 7:33 am
stevekozak2 wrote: Sun Mar 07, 2021 7:29 am My credit card rewards strategy is to not use a credit card. I get rewarded every month by not getting a credit card bill. Pretty sweet!!!
You pay the higher cost that merchants charge everyone to offset the credit card fees they have to pay, but you prevent yourself from getting the rewards (cash back, travel points) that come from using credit cards. Not to mention the 3 to 4 week float, purchase protection and other benefits that comes from using credit cards. Credit cards aren't for everyone, though. Many get themselves in trouble with them. I seriously doubt many frequenters of this site do, however.
I don't knock anyone who uses credit cards, and I know that most people do. I am just happier without them. Out of curiosity, do you know anyone who has gotten wealthy through getting rewards from a credit card?
Do you use debit cards, or just checks and cash?

I also think that the question "do you know anyone who has gotten wealthy through getting rewards from a credit card" is a bit silly. The obvious implication is that if the answer is "no" then credit cards rewards are worthless/bad/whatever. People don't get wealthy by shopping around or by clipping coupons either. To turn it around, if you got a 2% rewards credit card and ONLY used it for fixed purchases you were already making with basically no flexibility (insurance premiums, medical co-pays, gas, cell phone bill, other utilities), in what world would that not be a benefit to you?

I can see arguments that credit cards can cause people problems. If they carry a balance. If they spend on things they'd not otherwise do if they had to pay cash. On travel they'd not otherwise do. I also see and accept that people on the whole spend more using credit (or debit cards for that matter) than cash for some behavioral/psychological reasons (of course, not wise bogleheads who don't think that this applies to them, of course it doesn't).
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Re: What's Your Credit Card Rewards Strategy?

Post by LadyGeek »

I removed a contentious interchange regarding reasons for not buying from Amazon.

Please stay on-topic.
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sycamore
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Re: What's Your Credit Card Rewards Strategy?

Post by sycamore »

Barefootgirl wrote: Sun Mar 07, 2021 8:10 am Thank you for the suggestion to fund my future Amazon purchases (trying to wean myself from Amazon) using top offs to the account.

Mini rant - the Synchrony card does not operate like a traditional credit card where the bank has a relationship with the card holder. Synchrony apparently is just an arm of Amazon, so their bigger interests are with Amazon, screw the consumer.
Unless things have changed recently, Synchrony is its own entity. They provide store cards/service for various retailers not just Amazon.
Seasonal
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Re: What's Your Credit Card Rewards Strategy?

Post by Seasonal »

stevekozak2 wrote: Sun Mar 07, 2021 7:43 am
birdog wrote: Sun Mar 07, 2021 7:33 am
stevekozak2 wrote: Sun Mar 07, 2021 7:29 am My credit card rewards strategy is to not use a credit card. I get rewarded every month by not getting a credit card bill. Pretty sweet!!!
You pay the higher cost that merchants charge everyone to offset the credit card fees they have to pay, but you prevent yourself from getting the rewards (cash back, travel points) that come from using credit cards. Not to mention the 3 to 4 week float, purchase protection and other benefits that comes from using credit cards. Credit cards aren't for everyone, though. Many get themselves in trouble with them. I seriously doubt many frequenters of this site do, however.
I don't knock anyone who uses credit cards, and I know that most people do. I am just happier without them. Out of curiosity, do you know anyone who has gotten wealthy through getting rewards from a credit card?
Many people are able to take vacations, or take much nicer vacations, using credit card rewards than they would without using credit cards.

There was recent publicity about a couple who, through "clever" means, managed to charge over $6 million on a credit card, for which they got over $300,000 in cash back. The IRS sued them for taxes, but they kept the vast bulk of the money. Taxes were because they were buying cash equivalents with the card, rewards are otherwise not taxed. Given recent changes to credit card terms, replicating their actions are highly unlikely. https://onemileatatime.com/court-rules- ... s-taxable/
Jags4186
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Re: What's Your Credit Card Rewards Strategy?

Post by Jags4186 »

So, I am going to continue to shill for the US Bank Altitude Reserve card and have discovered a new stack that might be beneficial to some.

There is an app called “Slide” which allows you to buy gift cards to many retailers at a 5% discount. Slide is an available merchant through the TopCashBack.com portal. Slide also accepts Apple Pay.

A little bit of a cumbersome process to describe. Easy once you do it a few times but you want to remember all the steps to maximize. Here is how it works in practice:

Load your Slide App with amount of money needed for purchase with USB AR with Apple Pay (this is variable so you can load the exact amount of your purchase). Receive 1% back from Slide and 4.5% back from your CC.

Go through TopCashBack Portal to slide and purchase your gift card: Receive 4% back from slide app and 3% back from top cash back portal.

Go through TopCashBack portal and use gift card at merchant and receive additional cash back.

Here is an example of a purchase I recently did for $84.50 at JC Penney for some clothes.

Loaded $84.50 into my Slide app via Apple Pay and Altitude Reserve — received 5.5% total back: $4.65
Go through TCB portal and buy $84.50 JCP gift card — received 7% total back: $5.92
Go through TCB portal and buy $84.50 JCP merchandise — received 6% total back: $5.07
Total cash back = 18.5% before using any coupons at the merchant

I also was able to do this in store at Advanced Auto Parts. Once I saw the final total of the merchandise I was going to buy I was able to go through this whole process (minus the 2nd TCB portal) and purchase a $200.44 gift card. The cashier then scanned the bar code provided on my phone and I was on my way.

The only downside to this is that if you want to return any merchandise you’re stuck with a store credit so make sure you only do this at a place you know you’ll frequent at least once in a while.
Jags4186
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Re: What's Your Credit Card Rewards Strategy?

Post by Jags4186 »

stevekozak2 wrote: Sun Mar 07, 2021 7:43 am
birdog wrote: Sun Mar 07, 2021 7:33 am
stevekozak2 wrote: Sun Mar 07, 2021 7:29 am My credit card rewards strategy is to not use a credit card. I get rewarded every month by not getting a credit card bill. Pretty sweet!!!
You pay the higher cost that merchants charge everyone to offset the credit card fees they have to pay, but you prevent yourself from getting the rewards (cash back, travel points) that come from using credit cards. Not to mention the 3 to 4 week float, purchase protection and other benefits that comes from using credit cards. Credit cards aren't for everyone, though. Many get themselves in trouble with them. I seriously doubt many frequenters of this site do, however.
I don't knock anyone who uses credit cards, and I know that most people do. I am just happier without them. Out of curiosity, do you know anyone who has gotten wealthy through getting rewards from a credit card?
There are lots of things people do that don’t cause them to get wealthy. For example, being in good shape doesn’t cause you to get wealthy but it may reduce your healthcare expenses. Using credit cards doesn’t make me wealthy but it reduces my vacation expenses.

But that said, yes, there are people who have gotten wealthy using credit card rewards. You should familiarize with a recent legal case where a couple was forced to pay income tax on the $300,000 in credit card rewards they earned in one year. $300,000 is more than I make in a year. I know for a fact that $300,000 is not the upper bounds of what some people have made. In the old Wells Fargo 5x days some people cracked into the 2 comma club. If you know how to stretch the rules to the outermost bounds, and the provider lets you get away with it, then you can make big bucks.
sycamore
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Re: What's Your Credit Card Rewards Strategy?

Post by sycamore »

Jags4186 wrote: Sun Mar 07, 2021 9:26 am ...You should familiarize with a recent legal case where a couple was forced to pay income tax on the $300,000 in credit card rewards they earned in one year.
That was an interesting case. Here's one news story about it.
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Re: What's Your Credit Card Rewards Strategy?

Post by TravelGeek »

Jags4186 wrote: Sun Mar 07, 2021 9:26 am
But that said, yes, there are people who have gotten wealthy using credit card rewards. You should familiarize with a recent legal case where a couple was forced to pay income tax on the $300,000 in credit card rewards they earned in one year. $300,000 is more than I make in a year. I know for a fact that $300,000 is not the upper bounds of what some people have made. In the old Wells Fargo 5x days some people cracked into the 2 comma club. If you know how to stretch the rules to the outermost bounds, and the provider lets you get away with it, then you can make big bucks.
But at some point this turns from at best a hobby into a full time job, no? I wouldn’t want to manufacture spend for a living and become best friends with all the Walmart cashiers in the county (or whatever the strategy nowadays may be). Natural spend, with a bit of strategic use of the right cards and keeping up with promos, gets me far enough for my needs.
drk
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Re: What's Your Credit Card Rewards Strategy?

Post by drk »

Barefootgirl wrote: Sat Mar 06, 2021 10:04 am What card do you use for purchases on Amazon?
BofA Cash Rewards with Platinum Honors provides 5.25% back on Online Shopping, up to $2500 per quarter. That's what I use for Amazon and Costco Cash cards.
A useful razor: anyone asking about speculative strategies on Bogleheads.org has no business using them.
drk
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Re: What's Your Credit Card Rewards Strategy?

Post by drk »

stevekozak2 wrote: Sun Mar 07, 2021 7:43 am I don't knock anyone who uses credit cards, and I know that most people do. I am just happier without them. Out of curiosity, do you know anyone who has gotten wealthy through getting rewards from a credit card?
Thank you for subsidizing our purchases.
A useful razor: anyone asking about speculative strategies on Bogleheads.org has no business using them.
THY4373
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Re: What's Your Credit Card Rewards Strategy?

Post by THY4373 »

Jags4186 wrote: Sun Mar 07, 2021 9:26 am You should familiarize with a recent legal case where a couple was forced to pay income tax on the $300,000 in credit card rewards they earned in one year.
They actually weren't forced to pay tax on most of it. If you read the judgement the only taxable transactions were where they used CC to buy a MO directly or a CC load their reloadable card directly. Both of these were highly limited methods at the time. The vast majority of their spend was to buy GCs which were then used to buy MOs. The CC > GC transactions were deemed NOT taxable. This was way more of a loss for the IRS than a win (some bad reporting on the subject not withstanding).
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Re: What's Your Credit Card Rewards Strategy?

Post by Da5id »

THY4373 wrote: Sun Mar 07, 2021 4:17 pm
Jags4186 wrote: Sun Mar 07, 2021 9:26 am You should familiarize with a recent legal case where a couple was forced to pay income tax on the $300,000 in credit card rewards they earned in one year.
They actually weren't forced to pay tax on most of it. If you read the judgement the only taxable transactions were where they used CC to buy a MO directly or a CC load their reloadable card directly. Both of these were highly limited methods at the time. The vast majority of their spend was to buy GCs which were then used to buy MOs. The CC > GC transactions were deemed NOT taxable. This was way more of a loss for the IRS than a win (some bad reporting on the subject not withstanding).
The part that I find odd is that I thought that the CC companies had cracked down/were sensitive to manufactured spending. So I'm rather surprised that this degree of spend could be achieved in the current environment.
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Re: What's Your Credit Card Rewards Strategy?

Post by Seasonal »

Da5id wrote: Sun Mar 07, 2021 4:20 pm The part that I find odd is that I thought that the CC companies had cracked down/were sensitive to manufactured spending. So I'm rather surprised that this degree of spend could be achieved in the current environment.
It wasn't achieved in the current environment. It was years ago.
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Re: What's Your Credit Card Rewards Strategy?

Post by Jags4186 »

TravelGeek wrote: Sun Mar 07, 2021 3:37 pm
Jags4186 wrote: Sun Mar 07, 2021 9:26 am
But that said, yes, there are people who have gotten wealthy using credit card rewards. You should familiarize with a recent legal case where a couple was forced to pay income tax on the $300,000 in credit card rewards they earned in one year. $300,000 is more than I make in a year. I know for a fact that $300,000 is not the upper bounds of what some people have made. In the old Wells Fargo 5x days some people cracked into the 2 comma club. If you know how to stretch the rules to the outermost bounds, and the provider lets you get away with it, then you can make big bucks.
But at some point this turns from at best a hobby into a full time job, no? I wouldn’t want to manufacture spend for a living and become best friends with all the Walmart cashiers in the county (or whatever the strategy nowadays may be). Natural spend, with a bit of strategic use of the right cards and keeping up with promos, gets me far enough for my needs.
The question was “do you know anyone who has gotten wealthy using credit cards.” Wealth is subjective, but $300,000 is a lot of money, to me at least. That’s about 3 years worth of take home pay at my current salary.
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Re: What's Your Credit Card Rewards Strategy?

Post by THY4373 »

Da5id wrote: Sun Mar 07, 2021 4:20 pm The part that I find odd is that I thought that the CC companies had cracked down/were sensitive to manufactured spending. So I'm rather surprised that this degree of spend could be achieved in the current environment.
The CC companies cracking down is somewhat overreported in my experience. In fact given how easy it would be to identify MS the fact that it continues to exist at any scale shows me that they actually like it. What has undoubtedly changed since 2013-2014 which is the time frame we are talking about is uncapped 5% cashback cards (it wasn't just Amex back then). MS is generally quite a bit less profitable than it was in 2014. Also the widely used MS methods are more capped now. Even more recently one particular issuer of gift card blocked their use for large debit transactions at certain retailers greatly limiting the use of those gift cards for MS. Effectively, the limits in the system are on the liquidation side either using the CC directly or via gift cards but that doesn't have much to do with the CC companies.
Last edited by THY4373 on Sun Mar 07, 2021 5:26 pm, edited 2 times in total.
THY4373
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Re: What's Your Credit Card Rewards Strategy?

Post by THY4373 »

Jags4186 wrote: Sun Mar 07, 2021 5:09 pm
TravelGeek wrote: Sun Mar 07, 2021 3:37 pm
Jags4186 wrote: Sun Mar 07, 2021 9:26 am
But that said, yes, there are people who have gotten wealthy using credit card rewards. You should familiarize with a recent legal case where a couple was forced to pay income tax on the $300,000 in credit card rewards they earned in one year. $300,000 is more than I make in a year. I know for a fact that $300,000 is not the upper bounds of what some people have made. In the old Wells Fargo 5x days some people cracked into the 2 comma club. If you know how to stretch the rules to the outermost bounds, and the provider lets you get away with it, then you can make big bucks.
But at some point this turns from at best a hobby into a full time job, no? I wouldn’t want to manufacture spend for a living and become best friends with all the Walmart cashiers in the county (or whatever the strategy nowadays may be). Natural spend, with a bit of strategic use of the right cards and keeping up with promos, gets me far enough for my needs.
The question was “do you know anyone who has gotten wealthy using credit cards.” Wealth is subjective, but $300,000 is a lot of money, to me at least. That’s about 3 years worth of take home pay at my current salary.
If you get the underlying court documents which are a fascinating read that actually isn't their entire MS income. The IRS for whatever reason only went after their Amex rewards. There were several other 5% CB cards back then that they were also hitting but for whatever reason the IRS didn't go after those.
Last edited by THY4373 on Sun Mar 07, 2021 5:27 pm, edited 2 times in total.
Jags4186
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Re: What's Your Credit Card Rewards Strategy?

Post by Jags4186 »

THY4373 wrote: Sun Mar 07, 2021 5:20 pm
Da5id wrote: Sun Mar 07, 2021 4:20 pm The part that I find odd is that I thought that the CC companies had cracked down/were sensitive to manufactured spending. So I'm rather surprised that this degree of spend could be achieved in the current environment.
The CC companies cracking down is somewhat overreported in my experience. In fact given how easy it would be to identify MS the fact that it continues to exist at scale shows me that they actually like it. What has undoubtedly changed since 2013-2014 which is the time frame we are talking about is uncapped 5% cashback cards (it wasn't just Amex back then). MS is generally quite a bit less profitable than it was in 2014. Also the widely used MS methods are more capped now. Even more recently one particular issuer of gift card blocked their use for large debit transactions at certain retailers greatly limiting the user of those cards. All that said it is still possible to MS on scale.
Correct. My days of buying $5000 in VGC at Pathmark and then walking over to the customer service desk and turning them into $5000 of Western Union money orders is long over. In fact, I haven’t bought a money order since USPS shut that down probably 3 years ago. MS is dead where I live, but there are other parts of the country where it thrives.
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Re: What's Your Credit Card Rewards Strategy?

Post by Mudpuppy »

stevekozak2 wrote: Sun Mar 07, 2021 7:43 am I don't knock anyone who uses credit cards, and I know that most people do. I am just happier without them. Out of curiosity, do you know anyone who has gotten wealthy through getting rewards from a credit card?
Wealthy? No. But the credit card rewards and signup bonuses did pay for my air fare, hotel, rental car, and several experiences on my first "real" two-week vacation to Hawaii a couple of years ago. I use "real" in quotes because it's the first time I went somewhere just for vacation, rather than adding extra vacation days onto a planned work trip.

Edit: And I should add that this was purely with natural spending. I don't play the manufactured spending game. The closest I come is buying $500 of Target gift cards every holiday season when they have the 10% off sale on gift cards and buying $50 gift cards discounted to $35-40 on Amazon Prime Day for retailers I would normally spend at anyways, like a pet store.
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Re: What's Your Credit Card Rewards Strategy?

Post by MikeG62 »

Mudpuppy wrote: Sun Mar 07, 2021 6:17 pm
stevekozak2 wrote: Sun Mar 07, 2021 7:43 am I don't knock anyone who uses credit cards, and I know that most people do. I am just happier without them. Out of curiosity, do you know anyone who has gotten wealthy through getting rewards from a credit card?
Wealthy? No. But the credit card rewards and signup bonuses did pay for my air fare, hotel, rental car, and several experiences on my first "real" two-week vacation to Hawaii a couple of years ago. I use "real" in quotes because it's the first time I went somewhere just for vacation, rather than adding extra vacation days onto a planned work trip.

Edit: And I should add that this was purely with natural spending. I don't play the manufactured spending game. The closest I come is buying $500 of Target gift cards every holiday season when they have the 10% off sale on gift cards and buying $50 gift cards discounted to $35-40 on Amazon Prime Day for retailers I would normally spend at anyways, like a pet store.
I harvested a bunch of my Chase UR points for $3,000 in statement credits this year. I received $1,900 in cash back on my BofA Premium rewards card also just in 2020. This for only two of our many CC's. Am I getting wealthy from this? Nope. Does it make financial sense to charge what we are going to spend anyway to these cards and reap some benefits (or cost offsets)? It sure does.
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EnjoyIt
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Re: What's Your Credit Card Rewards Strategy?

Post by EnjoyIt »

stevekozak2 wrote: Sun Mar 07, 2021 7:43 am
birdog wrote: Sun Mar 07, 2021 7:33 am
stevekozak2 wrote: Sun Mar 07, 2021 7:29 am My credit card rewards strategy is to not use a credit card. I get rewarded every month by not getting a credit card bill. Pretty sweet!!!
You pay the higher cost that merchants charge everyone to offset the credit card fees they have to pay, but you prevent yourself from getting the rewards (cash back, travel points) that come from using credit cards. Not to mention the 3 to 4 week float, purchase protection and other benefits that comes from using credit cards. Credit cards aren't for everyone, though. Many get themselves in trouble with them. I seriously doubt many frequenters of this site do, however.
I don't knock anyone who uses credit cards, and I know that most people do. I am just happier without them. Out of curiosity, do you know anyone who has gotten wealthy through getting rewards from a credit card?
Wealthy? Maybe?

Let’s use simple math in an example for simplicity:

A family makes $105k per year after taxes and save $25k a year in pretax accounts and spend $80k/yr. To retire they need to save $2 million so that they can live on a 4% withdrawal rate. The average return on a 60/40 portfolio is 8.7% with 3% inflation means they will need to save for 31 years to reach their goal. If they play credit card and other bonus type games for $3k a year and they save that as well, they will instead reach their goal in 29 years.

Saving about 2 years to reach their goals. Did the extra $3k make them rich? Not really. Did it help? Sure did. I realize it is not that simple, but I would gladly play a little credit card game fun if it saved me a few years from needing to work.

Also, in the above example if this family worked for the same 31 years, their net worth would grow to $2.25 million allowing them to spend an addition $10k a year in retirement. I don’t think an additional $10k per year spending is meaningless.

One more example. This is for a retired couple living off of a $2million portfolio spending 4% or $80k a year. If they are able to save $3k a year do to credit card bonuses and such, their withdrawal rate would instead be 3.85%. Does it make a huge difference? No, but it sure doesn’t hurt.

I realize that these are cherry picked examples, but I wanted to show you particularly over long term how saving just a few thousand a year can really add up.
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Re: What's Your Credit Card Rewards Strategy?

Post by VictoriaF »

Barclays Choice Privileges card is now available with the highest bonus ever. I've learned about it from Doctor Of Credit's article, "Barclays Choice Privileges 75,000 Points Offer [Highest Ever]," https://www.doctorofcredit.com/barclays ... hest-ever/ , dated May 6, 2021, 10:00.

It's worth noting that no other travel blogger I follow has mentioned it. Perhaps, the reason is that this card does not have an annual fee and promoting it would conflict with the cards the bloggers are sponsored to promote.

When I travel I don't seek luxury hotels or free breakfast. I optimize for the location and price, and Choice seems to provide what I need. But for those interested in upscale hotel stays, a commenter on DOC's thread has linked an article "The 28 Best Ways to Redeem Choice Privileges Hotel Rewards Points" https://upgradedpoints.com/travel/hotel ... ds-points/ . The article provides a review of some really nice hotels around the world that are available at modest Choice point values.

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THY4373
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Re: What's Your Credit Card Rewards Strategy?

Post by THY4373 »

Choice reminds me a bit of Radisson overall not particularly great (at least since they got rid of the last night free perk and have devalued their points a couple of times) but with some sweet spots. I got some good use from my Radisson points in Norway a couple of year ago. I noticed a bunch of the good Choice redemptions per upgardedpoints are in Scandinavia and per a thread on FT it looks like a lot of Choice hotels in Scandinavia are unavailable award bookings so keep that in mind if that is one's intended use. It is not clear if it is a technical issue or an actual block.

https://www.flyertalk.com/forum/choice- ... nts-4.html
SuperSaver
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Re: What's Your Credit Card Rewards Strategy?

Post by SuperSaver »

So.... after 5000+ replies, is there a consensus winner?

I’ve done the math, and it seems like average is about $1000/year for most no-fee cards.


Is 2% cash back the winner?
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Re: What's Your Credit Card Rewards Strategy?

Post by manlymatt83 »

SuperSaver wrote: Thu May 13, 2021 11:31 am So.... after 5000+ replies, is there a consensus winner?

I’ve done the math, and it seems like average is about $1000/year for most no-fee cards.


Is 2% cash back the winner?
If you don't want to think about it, yes.
Da5id
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Re: What's Your Credit Card Rewards Strategy?

Post by Da5id »

SuperSaver wrote: Thu May 13, 2021 11:31 am So.... after 5000+ replies, is there a consensus winner?

I’ve done the math, and it seems like average is about $1000/year for most no-fee cards.


Is 2% cash back the winner?
2% is decent.

The winner is clearly to rotate through cards for sign up bonuses. But that takes effort.

The winner if you don't want to play the signup bonus game is to have a few cards that give > 2% bonuses on things you do, and the 2% card for the rest. e.g. I get 5% on quarterly Chase Freedom categories, 4% on gas, 3% on travel/dining/groceries, etc. One can do better than that too.
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Re: What's Your Credit Card Rewards Strategy?

Post by JackoC »

manlymatt83 wrote: Thu May 13, 2021 11:40 am
SuperSaver wrote: Thu May 13, 2021 11:31 am So.... after 5000+ replies, is there a consensus winner?

I’ve done the math, and it seems like average is about $1000/year for most no-fee cards.


Is 2% cash back the winner?
If you don't want to think about it, yes.
OK but if you absolutely don't want to think about the whole topic, why not name 1.5% cards the winner, if you already have one? For *cash* back, the BOA PR/CR combination at 'Platinum Honors' level ($100k+ in ETF's parked at Merrill) is more extra money than a 2% card for a lot of people than a 2% card is more money than a 1.5% card. And the amount of thought is pretty marginal IMO once it's set up. To me the serious thought comes from figuring out how to spend/optimize airline point/miles in such systems. That can get really complicated, and there's room IMO to kid yourself what value you are really getting out of those points (I got 1.86 cents per point!...in terms of an airline ticket cash price that was higher than competitors' prices if I'd shopped around). It's not for me, I realize it is attractive to some. Also to me 'rewards' means cash/points back per purchase. Of course there's also money, potentially more, in opening new cards just for the bonuses, but that's definitely not 'no thought'.
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Re: What's Your Credit Card Rewards Strategy?

Post by gpburdell »

SuperSaver wrote: Thu May 13, 2021 11:31 am So.... after 5000+ replies, is there a consensus winner?

I’ve done the math, and it seems like average is about $1000/year for most no-fee cards.


Is 2% cash back the winner?
It is for me as my primary every day spend as I don't want to think about it much. I use the Fidelity 2% cash back card and I use it for ~75% of my charges. I use it so much I have the number memorized lol.

However, if I buy something from Amazon then I use the Chase Amazon card which gets 5%. When I buy gas, I use the Citi Costco card which give you 4%. If I buy plane tickets, I use my Delta Amex for the miles.
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Re: What's Your Credit Card Rewards Strategy?

Post by spammagnet »

JackoC wrote: Thu May 13, 2021 11:55 am… For *cash* back, the BOA PR/CR combination at 'Platinum Honors' level ($100k+ in ETF's parked at Merrill) is more extra money than a 2% card for a lot of people than a 2% card is more money than a 1.5% card. And the amount of thought is pretty marginal IMO once it's set up. …
We've been doing that for a year and just got notice of the PR $95 annual fee on each of 2 cards. We can get 3% on dining with one of several CRs, with no fee. That's better than the 2% from the PR.

The PR 2% on dining travel is unlimited but, in reality, our actual dining out spending is less than the CR quarterly limit. The result is we use the PR only for 1.5% spending. We've optimized spending and bills (with very little effort) on other CR cards with other categories selected.

I'd have to spend >$18K on the 1.5% card to justify a single $95 annual fee, over the 1% CR bonus with no fee. That's unlikely. Dropping the PR also reduces the number of cards in play.
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Re: What's Your Credit Card Rewards Strategy?

Post by JackoC »

spammagnet wrote: Thu May 13, 2021 12:32 pm
JackoC wrote: Thu May 13, 2021 11:55 am… For *cash* back, the BOA PR/CR combination at 'Platinum Honors' level ($100k+ in ETF's parked at Merrill) is more extra money than a 2% card for a lot of people than a 2% card is more money than a 1.5% card. And the amount of thought is pretty marginal IMO once it's set up. …
We've been doing that for a year and just got notice of the PR $95 annual fee on each of 2 cards. We can get 3% on dining with one of several CRs, with no fee. That's better than the 2% from the PR.

The PR 2% on dining travel is unlimited but, in reality, our actual dining out spending is less than the CR quarterly limit. The result is we use the PR only for 1.5% spending. We've optimized spending and bills (with very little effort) on other CR cards with other categories selected.

I'd have to spend >$18K on the 1.5% card to justify a single $95 annual fee, over the 1% CR bonus with no fee. That's unlikely. Dropping the PR also reduces the number of cards in play.
The key is getting the 75% reward bonus as 'Platinum Honors', $100k+ in ETF's to park at Merrill for free (probably getting a bonus to set up the account). If 'a winner' is to be named here, I would guess the ability to swing that would be the rule rather than the exception here, though nobody is assuming absolutely everyone can do that. But if so the PR card is 2.625% 'everything else', which breaks even on the $95 fee, vs. 2% no fee, at $15.2k/yr (far less than we charge on it). And even that assumes no credit against the $95, whereas you can get $100 credit for airline incidentals every year, and this past year they gave a $50 credit for supermarket shopping on PR (and more recently have given 3.5% cash back, PH level, at supermarkets rest of this year). I'm not seeing the advantage to have more than one PR card though, I must be missing something there.

CR cards OTOH are even more of a no brainer at Platinum Honors level since there's no fee, nor are you limited to one card so it isn't really $2.5k/qtr spend limit for (what become at PH level) 5.25% categories, it's whatever multiple of that you can use that BOA will allow (we have 4 CR's, I don't know the max).

What it boils down to is (the obvious, I think) that if you spend quite little with credit cards and/or can't do Platinum Honors then a 2% for everything no fee card makes sense...and the whole question of credit card rewards is pretty trivial. With significant CC spending and ability to do PH at BOA their PR/CR combo can't be beat now AFAIK for *cash* back (airline points/miles is a different game, and 'the points are worth X cents each *on average*, if you pick and choose your airline/hotel point deals...' is not the same as X cents in cash).
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Re: What's Your Credit Card Rewards Strategy?

Post by spammagnet »

JackoC wrote: Thu May 13, 2021 3:27 pm... I'm not seeing the advantage to have more than one PR card though, I must be missing something there. ...
The second PR card is a vestige of a 2-player bonus game. The fee is waived in the first year.

Edit: we do get the PH bonus which is what makes it worthwhile. That's obviously possible for only a small minority of cardholders. Even people who may have a significant balance in an employer retirement account often can't move it.
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Re: What's Your Credit Card Rewards Strategy?

Post by drk »

spammagnet wrote: Thu May 13, 2021 12:32 pm We've been doing that for a year and just got notice of the PR $95 annual fee on each of 2 cards.
Note that the PR is churnable. I cancelled mine a few weeks back*, and BofA is pushing me to get the card again with the sign-up bonus.

* BofA wouldn't retract the annual fee if I downgraded to another Cash Rewards. The CSR said that I had to make that change before the fee posted. :oops:
A useful razor: anyone asking about speculative strategies on Bogleheads.org has no business using them.
spammagnet
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Re: What's Your Credit Card Rewards Strategy?

Post by spammagnet »

drk wrote: Thu May 13, 2021 4:32 pmNote that the PR is churnable. I cancelled mine a few weeks back*, and BofA is pushing me to get the card again with the sign-up bonus.

* BofA wouldn't retract the annual fee if I downgraded to another Cash Rewards. The CSR said that I had to make that change before the fee posted. :oops:
Thanks for the intel. I'll cancel before the fee posts and see if they want me back.
spammagnet
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Re: What's Your Credit Card Rewards Strategy?

Post by spammagnet »

drk wrote: Thu May 13, 2021 4:32 pmNote that the PR is churnable. I cancelled mine a few weeks back*, and BofA is pushing me to get the card again with the sign-up bonus.

* BofA wouldn't retract the annual fee if I downgraded to another Cash Rewards. The CSR said that I had to make that change before the fee posted. :oops:
Thanks for the intel. I'll cancel before the fee posts and see if they want me back.
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Re: What's Your Credit Card Rewards Strategy?

Post by djheini »

spammagnet wrote: Thu May 13, 2021 12:32 pm
JackoC wrote: Thu May 13, 2021 11:55 am… For *cash* back, the BOA PR/CR combination at 'Platinum Honors' level ($100k+ in ETF's parked at Merrill) is more extra money than a 2% card for a lot of people than a 2% card is more money than a 1.5% card. And the amount of thought is pretty marginal IMO once it's set up. …
We've been doing that for a year and just got notice of the PR $95 annual fee on each of 2 cards. We can get 3% on dining with one of several CRs, with no fee. That's better than the 2% from the PR.

The PR 2% on dining travel is unlimited but, in reality, our actual dining out spending is less than the CR quarterly limit. The result is we use the PR only for 1.5% spending. We've optimized spending and bills (with very little effort) on other CR cards with other categories selected.

I'd have to spend >$18K on the 1.5% card to justify a single $95 annual fee, over the 1% CR bonus with no fee. That's unlikely. Dropping the PR also reduces the number of cards in play.
May not apply to you but for some people, it's worth pointing out that the cash rewards cards have 3% foreign transaction fees, so if you do international travel and want to use it as your dining card, it's best to have another fallback option.
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