Yet Another: Which Credit Card For Earning Travel (For Me + Wife)

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eqttrdr
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Yet Another: Which Credit Card For Earning Travel (For Me + Wife)

Postby eqttrdr » Sat Oct 22, 2011 2:56 pm

First off thanks for a great and informative forum. I have read all I can and still at a crossroads as to which card to apply for....

Husband and wife only household (will need 2 cards)
total yearly combined income 120k
Dont carry balances.
EXP Fico scores of 765 and 760

Spending habits: (looking to put all these on the card and pay off monthly)

yearly:
$15000 groceries
$3600 gas
$2000 restaurants
$10000 misc
$36000 business inventory

Looking to save the most money (cash back?) and/or earn the most points redeemable for the BEST travel rewards/perks.

We NEVER go on vacation because we cant seem to set money aside for vacation planning. We were hoping that by getting rewards we could either use the cashback by moving the cashback into a savings account and paying for travel that way or getting rewards points redeemable for travel.

Major concern is to save money on current spending habits and/or use points/cashback for travel purchases/perks.


We were looking at:

Blue Cash Preferred
Amex Gold/Platinum
Chase Freedom/Sapphire
Visa Signature type card

(nothing to do with anything but I always wanted a Centurion after handling so many of them at my job--- just an awesome feeling card... at least I can dream...lol)


No clue here and any suggestions are greatly appreciated. Whatever we do decide will go through the affiliate links on the forum to say thanks.


jeffysdad
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Postby jeffysdad » Sat Oct 22, 2011 6:39 pm

Check this out from the WSJ the other day:
Video - Credit Cards Now Offering Huge Sign Up Bonuses and How Some People Are Capitalizing on the Deals - WSJ.com

There was a story in the paper, too. I think it was on Oct. 19, 2011.

I use cashback cards because it keeps things simple. However, the story/video referenced above tells how some people are earning hundreds of thousands of frequent flyer miles by taking advantage of new card offers.

It sounds like you might have a cash mgmt. issue with setting money aside for vacay. I like the Fidelity Amex because it pays 2% on everything and you can set it up to have rewards deposited directly into a Fidelity cash management account on which you can write checks and use a debit/atm card with no fees at any bank (they're reimbursed).
American Express: Blue Cash Preferred (groceries, 6%; gas, department store, 3%); Gold Delta SkyMiles (Delta Air Lines, 2 miles/dollar, free checked bag).
US Bank: Cash+ (utilities, phone, internet, restaurant, 5%; drugstores, 2%).
FIA Card Services: Fidelity Amex (everything, 2%); Fidelity Visa (everything, 1.5%).
Chase: Freedom (rotating, 5%); Amazon (Amazon.com, 3%); PriorityClub (IHG hotels, 5 points/dollar); Sapphire (not in use).

*All cards are registered with PriorityClub IDine program for 8 points/dollar at participating restaurants.

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Pete838
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Postby Pete838 » Mon Oct 24, 2011 5:35 pm

I would go with Amex Premier Rewards Gold or Amex Plat.. The MR program is pretty good for travel rewards, and if you have the Paltinum program the points transfer into just about any other rewards program, save a few.

With that kind of spend on groceries you could really reap some great benefits. The PRG is paying 2x on groceries and gas.
Freedom is never more than one generation away from extinction. We didn't pass it to our children in the bloodstream. It must be fought for, protected, and handed on for them to do the same.
Ronald Reagan

eqttrdr
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Postby eqttrdr » Tue Oct 25, 2011 9:11 am

thanks for the replies, I would have thought that given my spending pattern I would have been better served getting Blue Cash Preferred as the total amount saved/earned would be more than relative points if the same transactions are placed on a gold or platinum amex?

with the blue cash preferred I get $1400/yr cash, with the gold amex I only get around $1k in "points"

therefore wouldnt it be better to use the "cashback" just to pay for the vacations/travel?

what am I missing here?

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Pete838
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Postby Pete838 » Wed Oct 26, 2011 7:56 am

eqttrdr,
Your valuation of the points earned as rewards assumes that each point is only worth $.01. I value my points much higher.

For example, American Express recently ran a promotion offering 100,000 Membership Rewards points for the Platinum card. By your one cent valuation that would be $1,000. However, through a special offer from Delta I was able to transfer those 100,000 points into Delta Skymiles and receive a 50% bonus.

With my 150,000 Skymiles (plus some I already had) I'm currently shopping for plane tickets for a vacation next year for my wife and I to Spain and Portugal. A First Class (or Business Class) award ticket can be as low as 100k Skymiles each. The same itinerary on a paid ticket would be $5,190 each! So in this example the Skymiles are worth $0.0519 each, but the Membership Rewards points I traded for the Skymiles ended up being worth almost $0.069. Nearly seven cents per point!

You said you wanted the best TRAVEL rewards, and this is where the rewards programs really shine: International travel in premium cabins. And with points travel I can afford to take trips I otherwise probably couldn't afford to take, or would be sitting in coach. Of course, you could take the penny or two in cash rewards and save yourself the trouble of chasing points and watching for the deals, but I kind of enjoy it.

And with taking points instead of cash you won't have that $1400 sitting in your pocket (or a bank account) waiting for a car repair to come along and gobble it up. It's much easier to take the trip than find a way to convert the points to cash so you can spend it.
Freedom is never more than one generation away from extinction. We didn't pass it to our children in the bloodstream. It must be fought for, protected, and handed on for them to do the same.
Ronald Reagan

eqttrdr
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Postby eqttrdr » Wed Oct 26, 2011 5:04 pm

wow... thanks! that definitely puts it into perspective...

Exactly what happens when I have that extra $1400... it goes towards something else other than travel...bingo.

I always was under the assumption that travel points were always valued at .01 per point.

Thanks again for the clarification!

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Pete838
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Postby Pete838 » Wed Oct 26, 2011 6:23 pm

eqttrdr wrote:wow... thanks! that definitely puts it into perspective...
...
I always was under the assumption that travel points were always valued at .01 per point.
Thanks again for the clarification!

Now the next trick is to learn where to look for the big signup bonuses, and how to redeem them. For travel rewards I watch (and post on) FlyerTalk . You will find a ton of info from people that travel the world on free or little cost points, and a lot of helpful info from frequent flyers in general. You can also find a lot of good info at Fat Wallet .

And for cash value redemption, the points generally are worth no more than $.01, but airline rewards generally aren't sold that way. For example, a round trip NY to Prague in coach might be $1,200, and a round trip NY to Paris $900, but both will generally cost the same number of airline miles on redemption if you are redeeming them as airline miles from the airline directly. If you use MR points to purchase a plane ride from the AMEX travel website you will get exactly $.01 for them, and maybe a rebate bonus if they currently have one; 20% as of this post.
Freedom is never more than one generation away from extinction. We didn't pass it to our children in the bloodstream. It must be fought for, protected, and handed on for them to do the same.
Ronald Reagan



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