My Favorite Credit Cards
January 19, 2017
Do you find yourself stuck with big credit card bills after the holidays? One way to make credit cards work for you instead of against you is by maximizing the points you earn on stuff you buy throughout the year. In fact, I generally enough in points to more than cover my holiday spending.
Don’t forget that this only works if you pay the balance off each month. Late payment fees and interest charges can more than erase the value of points you earn. With that being said, here are the cards I use for each of my major spending categories:
Regular bills: For things like my cable, cell phone bill, insurance premiums, and subscriptions, I use the Chase Ink Cash Mastercard. It pays 5% cash back on the first $25k per year you spend on office supply stores, cellular and landline phone service, and Internet and cable TV services, 2% cash back on up to $25k per year spent on gas stations and restaurants, and 1% cash back on everything else. I keep this card at home so I don’t have to worry about losing it and having to update all my autopays.
Business travel: I use the new Chase Sapphire Reserve, which offers primary rental car coverage and 3 points per dollar spent on travel and restaurants. Those points can then be combined with the Chase Ink points above and redeemed for 50% more in Chase’s Ultimate Rewards portal or exchanged for points 1:1 with one of Chase’s 11 travel partners. There’s a pretty steep $450 annual fee but also a $300 travel credit and a $100 Global Entry fee credit so you can still come out ahead if you travel enough. Finally, it offers a 100,000 point sign-up bonus if you apply by March 12 at one of Chase’s bank branches and spend $4,000 in the first 3 months.
Amazon purchases: I’m an Amazon Prime member and do most of my big ticket spending on Amazon so the Amazon Prime Rewards Visa Signature Card makes sense. It offers 5% cash back on Amazon purchases (for Prime members), 2% back on restaurants, gas stations, and drug stores, and 1% back on everything else along with purchase and extended warranty protections. Not only is there no annual fee, you also get a $70 Amazon gift card for signing up.
Target purchases: I have a Target a couple blocks from my home so I tend to do most of my in-person shopping there. The Target REDcard provides a 5% discount and an additional 30 days for returns. I signed up for the debit card since it provides the same benefits without having yet another credit card on my credit report.
Other purchases: I use the Consumers Credit Union Visa Signature Cash Rebate card. It gives me 3% cash back on grocery stores, 2% on gas, and 1% on everything else. That doesn’t sound that great, but if I spend $500 in a month, I can get a 3.59% interest rate on up to $15k in my Consumers Credit Union rewards checking account and if I spend $1,000 in a month, I get a 4.59% rate on up to $20k in that account. That 4.59% interest rate can easily dwarf the value of other cards’ rewards, especially if you’re more of a saver than a spender like me.
Once I hit $1,000 in a month on my Consumers Credit Union Visa, I use the Citi Double Cash Mastercard. It offers a simple 1% cash back on every purchase and then another 1% cash back when you pay it off for a total of 2% cash back on all purchases. This is a good card to have in addition to any cards you may choose for more specialized spending categories.
Keep in mind that just because I chose these credit cards doesn’t mean they’re the best for you. Think about how you use credit cards and what you spend them on to see which card(s) offer you the most value. (For some, the simplicity of having only one card may be their best value.) Finally, I’m always up for suggestions. If you know a card that might be better for my spending, send me an email at [email protected].
