questions about rewards card

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charged
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questions about rewards card

Postby charged » Sat Apr 30, 2016 8:34 pm

Hi, I used to mostly just use cash and a chase slate for purchases where cash wasn't applicable. By paying my balance in full each month I realized my credit had increased to the point where I may be able to take advantage of rewards cards. I went with the Capital One quicksilver since the sign up bonus and the 1.5% cashback on everything without restrictions were highly appealing. This card is working for me and I think I made the right choice.

However, I realize that most of my money is going towards food at the grocery store. I've cut out some expenses but a guy's still got to eat though. I've got my eyes on the American Express blue cash everyday card. The sign up bonus could help me out, and the 3% back on groceries seems awesome. Really, the only turn off is that they say there is a $6,000 cap on that cash back. I think I spend just over that per year on groceries. I'm aware of the preferred option with 6% back but I'm not interested in paying an annual fee even if it does turn out to give me more back.

Is this a good choice? Is the sign up bonus still $150 for spending $500 in three months? Has anyone had any problems with this card in particular? Does it hurt my credit a lot to apply for this card just a couple months after getting the Quicksilver card? I'm also looking at the citi double but wouldn't get both.


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Vattené
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Re: questions about rewards card

Postby Vattené » Sun May 01, 2016 12:33 pm

When I just looked the offer was only $100 for $1,000 spend. $100 for BCE and $150 for BCP are pretty standard, though it's possible to find higher offers. I'm not aware of what the spending requirements typically are for Amex, but with my ED it was also $1,000. They're also offering a temporary 10% back on cell phone service.

Now that Sallie Mae isn't open to applications, the BCE is a good card for someone that spends a lot on groceries (BCP can provide more value, but I understand not wanting to sign up for an AF), but be aware before applying that the merchant has to be coded as a grocery store, which excludes big box retailers and discount stores (many sign up and are disappointed Walmart or Target don't qualify for grocery rewards). Another common frustration is Amex takes a while to post rewards, so it will be an adjustment from Cap One which is about as immediate as it gets. [Edited to add: there's also a $25 minimum redemption for rewards.] That said, it's cash so if the rewards are good IMO that shouldn't be too big of a concern.

As for credit impact, that depends on your credit profile. A credit inquiry will stay on your reports for 2 years (but the impact will taper off over time), and a new account will drag down your AAoA. It shouldn't hurt you too much if you have established credit. Plus, unless you are anticipating a big credit need soon (like a mortgage or car loan), a temporary credit dip won't have any real impact on you. I say if you've found a card that will be beneficial to you then go for it.

Good luck!
-Vattené
FICO-8:
EX - 809 (11/16) | TU - 803 (11/16)
Primary Cards:
American Express EveryDay - $20,000 (10/14)
Discover it - $23,000 (2/14)
AU on Barclay Sallie Mae - $10,000 (8/15)
plus several store accounts of varying usefulness now

kdm31091
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Re: questions about rewards card

Postby kdm31091 » Sun May 01, 2016 6:59 pm

The BCE is not a bad card. You'd be doubling your return on groceries compared to your QS. That said, there are some caveats to be aware of with the card, most of which have already been pointed out but I'll reiterate:

Amex is delayed with reward posting, usually by 2 months/statements. So the rewards listed on one statement do not match the purchases from that one, and you need to be patient. You do eventually get the rewards, but some people (like me) don't like the lag. There is not just a $25 minimum to cash out - you actually have to redeem in increments of $25. So for "cash back" statement credits, you have to redeem either $25, $50, or $75, etc. No in between. It's quite user unfriendly compared to almost every other cash back card around.

Assuming you don't care about the reward delays and redemption hassles, the other thing to point out is that Walmart and Target do not count for "groceries" with Amex -- strictly just "real" grocery stores, whereas many Visa/MC are more lax about it. So if you do most of your shopping at those stores you may be disappointed.

Lastly, while the Double Cash is a great general spending card, it's really hard to justify applying for it when basically almost ANY other cash back card you apply for will give you $100+ for applying. You'd have to spend many thousands of dollars before the Double Cash would out-earn something else that has a sign up bonus (since the Double Cash does not). Again, some people don't care, and just want a "set it and forget it" card, which Double Cash is good for. But if you're browsing the card market, most cards provide more incentive to sign up. You already have a QS, so taking a HP and new account ding for no sign up bonus and a 0.5% increase in rewards may prove to be not worth it.

takeshi
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Re: questions about rewards card

Postby takeshi » Mon May 02, 2016 11:30 am

charged wrote:I'm aware of the preferred option with 6% back but I'm not interested in paying an annual fee even if it does turn out to give me more back.

Why not? Have you worked out what the difference would be in dollars after the AF for the BCP is considered?

I know you say your grocery spend is just over $6K but let's use $6K for comparison.

$6K @ 1.5% is $90
$6K @ 3% is $180
$6K @ 6% - $75 is $285

So $90 is worth it to you but $195 is not?

charged wrote:Is this a good choice?

I wouldn't consider it good to avoid AF without considering total cost/benefit but good is subjective regardless of topic so it's your call to make. If you absolutely insist on avoiding AF's then the BCE probably is a good choice. Run the numbers when making such comparisons to aid you in your decision making.

charged wrote: Does it hurt my credit a lot to apply for this card just a couple months after getting the Quicksilver card?

It's not just about applying for the 2 cards but your credit profile. 1 or 2 HP's generally have little impact but impact can be bigger for those with then credit profiles and/or credit profiles with issues.

charged wrote:Has anyone had any problems with this card in particular?

People have problems with all sorts of cards and people don't have problems with all sorts of cards. What specific problems are you referring to?

Some considerations have been pointed out above but I wouldn't consider them to be problems.

charged
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Re: questions about rewards card

Postby charged » Tue May 03, 2016 11:31 am

kdm31091 wrote:The BCE is not a bad card. You'd be doubling your return on groceries compared to your QS. That said, there are some caveats to be aware of with the card, most of which have already been pointed out but I'll reiterate:

Amex is delayed with reward posting, usually by 2 months/statements. So the rewards listed on one statement do not match the purchases from that one, and you need to be patient. You do eventually get the rewards, but some people (like me) don't like the lag. There is not just a $25 minimum to cash out - you actually have to redeem in increments of $25. So for "cash back" statement credits, you have to redeem either $25, $50, or $75, etc. No in between. It's quite user unfriendly compared to almost every other cash back card around.

Assuming you don't care about the reward delays and redemption hassles, the other thing to point out is that Walmart and Target do not count for "groceries" with Amex -- strictly just "real" grocery stores, whereas many Visa/MC are more lax about it. So if you do most of your shopping at those stores you may be disappointed.

Lastly, while the Double Cash is a great general spending card, it's really hard to justify applying for it when basically almost ANY other cash back card you apply for will give you $100+ for applying. You'd have to spend many thousands of dollars before the Double Cash would out-earn something else that has a sign up bonus (since the Double Cash does not). Again, some people don't care, and just want a "set it and forget it" card, which Double Cash is good for. But if you're browsing the card market, most cards provide more incentive to sign up. You already have a QS, so taking a HP and new account ding for no sign up bonus and a 0.5% increase in rewards may prove to be not worth it.


Yeah the quicksilver does appear to have a way better redemption policy. When you say that I have to wait two statements before I see rewards, is that a set period of time (like 60 days) or does it vary when they give them to you? I go to stop and shop which I assume counts as a 3% covered grocery store.

charged
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Re: questions about rewards card

Postby charged » Tue May 03, 2016 11:34 am

takeshi wrote:
charged wrote:I'm aware of the preferred option with 6% back but I'm not interested in paying an annual fee even if it does turn out to give me more back.

Why not? Have you worked out what the difference would be in dollars after the AF for the BCP is considered?

I know you say your grocery spend is just over $6K but let's use $6K for comparison.

$6K @ 1.5% is $90
$6K @ 3% is $180
$6K @ 6% - $75 is $285

So $90 is worth it to you but $195 is not?

charged wrote:Is this a good choice?

I wouldn't consider it good to avoid AF without considering total cost/benefit but good is subjective regardless of topic so it's your call to make. If you absolutely insist on avoiding AF's then the BCE probably is a good choice. Run the numbers when making such comparisons to aid you in your decision making.

charged wrote: Does it hurt my credit a lot to apply for this card just a couple months after getting the Quicksilver card?

It's not just about applying for the 2 cards but your credit profile. 1 or 2 HP's generally have little impact but impact can be bigger for those with then credit profiles and/or credit profiles with issues.

charged wrote:Has anyone had any problems with this card in particular?

People have problems with all sorts of cards and people don't have problems with all sorts of cards. What specific problems are you referring to?

Some considerations have been pointed out above but I wouldn't consider them to be problems.


I did the math and you are right that I'd end up saving more, but my spending habits might change and I'm still not interested in the card with the annual fee. Even without the one with the annual fee would still double my cash back on groceries and have a sign up bonus so that's where the incentive is. I am disappointed to hear that AMEX doesn't give out rewards immediately, but people are saying I have to wait two months. That's where the concern is right now. I guess as long as I eventually get it, this isn't a problem.

augiedog
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Re: questions about rewards card

Postby augiedog » Tue May 03, 2016 12:29 pm

charged wrote: Really, the only turn off is that they say there is a $6,000 cap on that cash back. I think I spend just over that per year on groceries. I'm aware of the preferred option with 6% back but I'm not interested in paying an annual fee even if it does turn out to give me more back.

Is this a good choice? Is the sign up bonus still $150 for spending $500 in three months? Has anyone had any problems with this card in particular? Does it hurt my credit a lot to apply for this card just a couple months after getting the Quicksilver card? I'm also looking at the citi double but wouldn't get both.


Right now the regular Chase Freedom is offering 5% cash back on groceries from April-June. Now I realize that's 1/3 of the way over, but you could still use it and get the $150 sign-up bonus. No annual fee either. They promoted groceries last year, so if the Amex BCE $6000 cap is an issue for you, this will let you receive cash back on $1500 more in groceries per year. Once the promotion has ended, why not sign up for the Amex Blue Cash?

Don't go overboard with signing up for new cards though. You can always get the Freedom Unlimited, Quicksilver, or Doublecash later. The first two have sign up bonuses worth over $100, which beats an additional 0.5% very quickly.
American Express: Blue Cash Everyday (10k), Everyday, ; Discover It (7.3k) ; Target (2.1k)

Citi: Diamond (2k) ; Bank of America: Cash Rewards (2.6k) ; Capital One: Quicksilver (3k) , Sony ; Chase: Freedom (3.7k), Slate (3k), (Amazon) ; Barclay Ring ; Synchrony: Walmart MC, Amazon, Ebates

DONx3
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Re: questions about rewards card

Postby DONx3 » Tue May 24, 2016 3:02 pm

I use the CF if groceries are part of the 5% category. The rest of the year I use the BCE. I'd go for the BCE.
Amex Blue Cash Everyday 07/01
Amex Starwood Preferred Guest 03/16, BD 01
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Southwest Rapid Rewards Plus Visa Sig 08/16

Kevin86475391
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Re: questions about rewards card

Postby Kevin86475391 » Tue May 24, 2016 8:20 pm

charged wrote:I did the math and you are right that I'd end up saving more, but my spending habits might change and I'm still not interested in the card with the annual fee.

Personally I very much agree with this philosophy. I avoid annual fees for the same reason. Just because I spent X amount on a given category last year doesn't mean I'll spend it again next year and I'd never want to be penalized for saving and budgeting. I also don't like to be locked into any one card. Annual fee rewards cards can be good if you want to spend a lot on a particular card consistently, but personally I'm all about dividing up my spending across multiple cards. Personally, I'd rather get $50-$100 less in rewards annually for the luxury of being able to spread my spending across 4 or more cards instead of being stuck using the same one for everything. I really like to dilute my spending over multiple cards and personally don't care about diluting my rewards since I only do cash back anyway and don't really care how long it takes to reach thresholds as long as I get my money eventually.

That said, I've gone from having the Amex BCE on my own eventually list to deciding it's just not worth it. To me the redemption in $25 increments would be hugely annoying. I wouldn't care at all about a $25 threshold and also don't personally care if there's a 1-2 statement lag, but having to redeem exactly $25, $50, $75, etc. at a time is just absurd and not something I want to put up with.

However, my personal biggest problem with the BCE and Amex would be the application itself. I'm fine providing income info, but I've recently learned that Amex asks about assets in checking and savings accounts on applications. I find that much too intrusive and am unwilling to provide that information when other lenders do not require it.

Personally, I'd only find marginal additional value from getting a BCE and while I'm willing to eventually app for that marginal value, I'm not willing to do so at the cost of that extra layer of information they want that I personally find much too intrusive. I can certainly understand why they'd want to know about my assets since that speaks to my ability to pay them, but as long as other lenders are willing to approve me without requiring me to disclose such things, I would much rather not. So for me the BCE/Amex in general isn't worth it, but YMMV.

kdm31091
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Re: questions about rewards card

Postby kdm31091 » Tue May 24, 2016 8:42 pm

I'm biased against BCE because of the above mentioned $25 increment redemption. It's ridiculous. If you are only using it for grocery spend at 3%, it may feel like a long time waiting for the rewards to reach the required $25, or $50, or $75 (nothing in between).

So personally, I don't think it's that great of a card. Plus Walmart/Target don't count as "grocery" for it, and you can often save more by buying groceries there.



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