Author Topic: Credit Card Rewards  (Read 4199 times)

acc7x3

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Credit Card Rewards
« on: October 29, 2013, 08:46:25 AM »
Here is a question that I have thought about for a long time.

When is it best to cash in cash back rewards for a credit card?

I have a Amex Blue cash rewards card (got the 150! Thank MMM) but was thinking is it best to get the cash back every time I am eligible or just save it up?
I kind of see it as six one way and one half dozen the other. But with this being MMM and where most things are micromanaged, I was wondering if it was best to take the early cash, pay off the credit card with it, and have other funds to save/invest/etc. But getting $25 back every so often doesn't feel that great as getting a few hundred back after a period of time.

aclarridge

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Re: Credit Card Rewards
« Reply #1 on: October 29, 2013, 08:56:40 AM »
The best thing to do is take out the reward cash at your earliest convenience. You have more productive uses for it than having it sit there not earning anything.

Nothlit

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Re: Credit Card Rewards
« Reply #2 on: October 29, 2013, 10:15:06 AM »
I have an Amazon.com Visa card, and I simply redeem the reward "cash" as a statement credit. Keeps it simple -- no need to wait for a check in the mail, and the end result is the same. I redeem it as soon as I have the minimum number of points available (2000 points = $20 credit). Waiting for larger point totals, in my case, does not result in any greater cash value.

StarryC

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Re: Credit Card Rewards
« Reply #3 on: October 29, 2013, 10:36:37 AM »
If you do it in $20 here/ $20 there chunks, mentally, it doesn't register as "HURRAY FREE MONEY LET ME SPEND IT," it's just a little reduction in your budget.  If you wait until you have $400 you might be more tempted to be, "$400 free, I better go buy an unnecessary iPad!" 

prosaic

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Re: Credit Card Rewards
« Reply #4 on: October 29, 2013, 11:04:35 AM »
I cash out my Discover card when they do a $50 for $40 in reward dollars deal. Then I use the gift cards as gifts for various people at Christmas.

madage

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Re: Credit Card Rewards
« Reply #5 on: October 29, 2013, 11:27:45 AM »
I cash out my Discover card when they do a $50 for $40 in reward dollars deal. Then I use the gift cards as gifts for various people at Christmas.

This is a great tip for Discover cardholders. American Express occasionally offers special redemption rates for partner gift cards, but usually nothing better than 10% off, and the partner gift cards never interest me much. I find it's best to simply redeem my Blue Cash for statement credits as it becomes available.

acc7x3,
Did you get the Everyday or the Preferred version? If you spend more than $2,500 per year on groceries, paying the annual fee makes sense. If you did get the Preferred version, there's actually a $250 sign-up bonus available.

aj_yooper

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Re: Credit Card Rewards
« Reply #6 on: October 29, 2013, 11:52:08 AM »
I use the Fidelity American Express free card that gives 2% cash back on all purposes; the rebate money goes straight to my Fidelity taxable account.  I don't use the points for airline tickets as I think I do better with cash purchases. 

acc7x3

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Re: Credit Card Rewards
« Reply #7 on: October 29, 2013, 03:29:28 PM »
acc7x3,
Did you get the Everyday or the Preferred version? If you spend more than $2,500 per year on groceries, paying the annual fee makes sense. If you did get the Preferred version, there's actually a $250 sign-up bonus available.

I am pretty sure I got the preferred. Have an annual fee of $75, but when I signed up I only got a $150 credit statement.

madage

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Re: Credit Card Rewards
« Reply #8 on: October 29, 2013, 03:41:36 PM »

I am pretty sure I got the preferred. Have an annual fee of $75, but when I signed up I only got a $150 credit statement.

Yep, that's the preferred. If you have a spouse, he/she can sign up for a card through www.creditcards.com/cardmatch and get another $250 bonus. Well, $175 after the annual fee. There's nothing wrong with a little credit card churn.

Gift cards at grocery stores are a great way to make two Blue Cash Preferred cards the best way (IMO) to earn credit card cash back.