My parents spent the past weekend at Glen Cove Mansion where they attended a weekend marriage retreat that their church hosts every year.In addition to learning some improved couples communication techniques, they were able to catch up with a lot of their NYC friends that they haven't seen in the past 4 months.
Several of them mentioned they were
A few of them were already playing the game and had a travel credit card they signed up for. But they weren't building their balances quite as much/quickly as we've been able to. In fact, multiple times during the weekend, my parents were asked, "How are you able to get so many points so quickly?" (you would have thought they'd be asking how their 1.5 year old daughter was doing...but nope).
So despite getting overlooked, I decided to explain a little bit more about how exactly my parents have played this game. But keep in mind that it's definitely not for everyone - especially if either (A) you're spending more than you're earning or (B) not paying off your credit card balances in full. As I mention to everyone, points and miles are worth 2-4% usually (6-8% at most), but they're worthless if you're paying 20% in interest charges by carrying a balance and ruining your financial future. Over the next few days, I'll walk you through the following:
Chapter 1 - Three Types of Travel Credit Cards
Chapter 2 - Credit Card Churn Example
Chapter 3 - Credit Score FAQ
Chapter 4 - Tracking Your Points/Miles
Chapter 5 - Meeting Minimum Spend Requirements
Chapter 6 - Maximizing Regular Spend
So here we go....
Chapter 1 - Three Types of Credit Cards
As my parents learned on their marriage retreat, whenever you start a project, you need to first identify a SMART goal in mind. SMART being an acronym for Specific, Measurable, Attainable, Relevant and Time-Bound.
So what is it that you're trying to get? Do you want to fly in business class to an international destination this summer? Do you want free hotel rooms for an bachelor party in the city this September? Do you just want to board the plane early and/or avoid paying checked baggage fees on your weekly business trips? Do you want to save money for a family vacation next year to Disneyworld? Do you want to have a second honeymoon in Paris at a luxury hotel this coming May? Or maybe you're not sure yet and you're just building up miles/points for something unknown in the future?
Whatever your answer is will determine the best credit cards to get over the next few months. So that's why my father never really has a simple one-shoe fits all answer for everyone. It really depends.
But regardless of your SMART travel goal, there's a good way to categorize the available credit cards, no matter what hotel, airline or bank they're affiliated with. As my father read on a popular blog called View From The Wing by Gary Leff, there are 3 types of credit cards. According to the blogger, you have the following:
First, you have credit cards that offer amazing bonuses for getting approved but not much thereafter. You meet (sign up & get the card), take them out once (spend the minimum required), get what you want (the sign-up bonus), then you never call them again (put away in the underwear drawer).
I can't list all the credit cards out in the market that fall into these buckets, but I'll go through the list of the 17 active cards my father currently has. The ones in his wallet that fit into this One Night Stand category are:
A. Chase Priority Club Visa (80,000 hotel points that gave him almost enough for 3 free nights at the Intercontinental Berchtesgaden coming up in May)
B. Citi American Airlines Visa/Amex (50,000 American Airline miles each worth ~$1,000 of AA flights)
C. Barclays US Airways Mastercard (35,000 US Airways Miles worth ~$700 of US flights)
D. Bank of America/Hawaii Hawaiian Airlines Visa (35,000 Hawaiian Miles each that converted at 2x into 70,000 Hilton points that we used to get free nights at the Conrad Koh Samui Resort).
E. American Express Platinum (100,000 Amex Membership Reward points worth at least $1,000 credit but can be converted into airline miles that yield $2,000-3,000 of value)
F. Capital One VentureOne Visa (100,000 points worth $1,000 travel credit that we used last August for 3 nights at the Westin Tokyo)
As you can see, most of these cards are affiliated with Hotels and Airlines that my father doesn't use often. He prefers United Airlines and Starwood/Hyatt hotels, so we have no reason to spend more than the minimum on these other cards. Most of these cards will be cancelled when their annual fee comes due over the next few months. By cancelling, you may potentially have the ability to earn the sign up bonus again after sitting out 12-18 months (also known as "churning" in the Points/Miles community).
But never "break up" with the card immediately after getting the bonus. Then you make it too obvious that you were using them and never intended to be with them long term. Instead, just keep your option open but don't use it. They'll get the message after months of inactivity. Then after 10-11 months, call to cancel when their pain has been dulled by time.
Booty Call (Ongoing Benefit) Cards
Second, you have credit cards that give you additional perks of membership for certain airlines or hotels as long as you keep the cards open. These cards will give you low/mid tier elite status outright (Hyatt Platinum status or Hilton Silver status) or at least some of the elite benefits (free checked bags and priority boarding).
In this case, you meet (sign up & get the card), take them out once (spend the minimum required), get what you want (the sign-up bonus), but booty call them every so often when they come in handy for specific situations like a business trip where you're flying on your non-primary airline or visiting friends in a town without your primary hotel chain.
The ones in my father's wallet includes:
A. American Express Hilton HHonors (low-tier Silver status - late checkout; free bottled water)
B. Chase Hyatt Visa (mid-tier Platinum status - free internet, late checkout; 1 free night a year in a Category 1-4 Hyatt hotel)
C. Chase Priority Club Visa (top-tier Platinum status - room upgrades, late checkout, free internet; 1 free night a year in any Intercontinental, Crowne Plaza or Holiday Inn)
D. Citi American Airlines Visa/Amex (free checked bags; priority boarding; 10% miles back on award redemptions)
E. Barclays US Airways Mastercard (free checked bags; priority boarding; two $99 companion passes annually; 5k mile discounts on award redemptions; 10k bonus anniversary miles every year)
F. American Express Platinum ($200 airline credit vouchers/year; airport lounge access; Starwood Hotel mid-tier Gold status; access to American Express Fine Hotels & Resorts bookings; $100 credit for Global Entry application fee)
You'll notice that some of the cards are also on the One Night Stand list. That's because (as several of you can attest) sometimes a One Night Stand turns into a Booty Call when the need arises. Because they offer certain benefits every year as long as you have the card open, it may make sense to pay the annual fee and keep beyond the first year. But that depends on if you'll use the Booty Call card benefit like the 1 free hotel night (whoa, I wasn't even trying to make that connection).
Marriage (Bonus Spending) Cards
Then finally come the keepers - the cards that are so amazing and make it so compelling to have that you don't mind becoming the unliving dead paying the annual fee. Without them, you'll miss out on great opportunities to accelerate your points/miles. In general, these cards are the ones that give you extra bonus for spending in certain categories like restaurants, gas, groceries, travel, etc.
As before, sometimes the Marriage cards are also great One Night Stand and/or Booty Call cards. They're not mutually exclusive.
But I repeat this theme again, it always depends on your individual situation. You may live in Manhattan and not have a car, so the extra points on gas are worthless to you. You may be on a strict diet/budget and avoid restaurants completely. You may be reading this blog post because you don't have extra money to travel, so getting 2x on paid airfare isn't worth anything to you. Some people prefer brunettes and others blondes. To each their own.
But if you do have a meaningful amount of spending in these certain bonus categories, you can get to your SMART travel goal 2x as fast if you have one/some of these cards that my father has:
A. American Express Starwood (1x on all spend, but can be transferred to airlines at 1.25x; also the only real way to get a large balance of hard to earn SPG points without staying weeks in a hotel)
B. Chase Sapphire Preferred Visa (2x on dining and travel, including Dunkin Donuts and MTA metrocards)
C. Chase Freedom Visa (5x on rotating categories every quarter that include groceries, restaurants, gas stations, retailers)
D. Chase Ink Bold Mastercard (5x on cell phone, internet, office supply stores)
E. Chase United Select Visa (Up to 5k elite qualifying miles for $5k United spend; 3x on all United spend)
F. Citi Thank You Preferred Visa (5x on gas, groceries, & drugstore)
If you're like my parents, most of your monthly expenses is your housing (rent or mortgage). But after this elephant expense, the majority of the balance falls into at least one of these bonus categories above. So why earn only 1 point per dollar when you can get 2-5x?
And since my parents learned how to communicate in their marriage retreat, I thought I'd end with this.
"I feel excited when you earn thousands of points for spending on things we'd normally buy anyway and use those points for free/cheap travel."
"I can imagine you're thinking how amazing our vacations will be from now on."
So what is it that you're trying to get? Do you want to fly in business class to an international destination this summer? Do you want free hotel rooms for an bachelor party in the city this September? Do you just want to board the plane early and/or avoid paying checked baggage fees on your weekly business trips? Do you want to save money for a family vacation next year to Disneyworld? Do you want to have a second honeymoon in Paris at a luxury hotel this coming May? Or maybe you're not sure yet and you're just building up miles/points for something unknown in the future?
Whatever your answer is will determine the best credit cards to get over the next few months. So that's why my father never really has a simple one-shoe fits all answer for everyone. It really depends.
But regardless of your SMART travel goal, there's a good way to categorize the available credit cards, no matter what hotel, airline or bank they're affiliated with. As my father read on a popular blog called View From The Wing by Gary Leff, there are 3 types of credit cards. According to the blogger, you have the following:
- Cards you get for the Sign Up Bonus.
- Cards you get for the Ongoing Benefits.
- Cards you get for Bonus Spending.
- One Night Stand Cards
- Booty Call Cards
- Marriage Cards
I can't list all the credit cards out in the market that fall into these buckets, but I'll go through the list of the 17 active cards my father currently has. The ones in his wallet that fit into this One Night Stand category are:
A. Chase Priority Club Visa (80,000 hotel points that gave him almost enough for 3 free nights at the Intercontinental Berchtesgaden coming up in May)
B. Citi American Airlines Visa/Amex (50,000 American Airline miles each worth ~$1,000 of AA flights)
C. Barclays US Airways Mastercard (35,000 US Airways Miles worth ~$700 of US flights)
D. Bank of America/Hawaii Hawaiian Airlines Visa (35,000 Hawaiian Miles each that converted at 2x into 70,000 Hilton points that we used to get free nights at the Conrad Koh Samui Resort).
E. American Express Platinum (100,000 Amex Membership Reward points worth at least $1,000 credit but can be converted into airline miles that yield $2,000-3,000 of value)
F. Capital One VentureOne Visa (100,000 points worth $1,000 travel credit that we used last August for 3 nights at the Westin Tokyo)
As you can see, most of these cards are affiliated with Hotels and Airlines that my father doesn't use often. He prefers United Airlines and Starwood/Hyatt hotels, so we have no reason to spend more than the minimum on these other cards. Most of these cards will be cancelled when their annual fee comes due over the next few months. By cancelling, you may potentially have the ability to earn the sign up bonus again after sitting out 12-18 months (also known as "churning" in the Points/Miles community).
But never "break up" with the card immediately after getting the bonus. Then you make it too obvious that you were using them and never intended to be with them long term. Instead, just keep your option open but don't use it. They'll get the message after months of inactivity. Then after 10-11 months, call to cancel when their pain has been dulled by time.
Booty Call (Ongoing Benefit) Cards
Second, you have credit cards that give you additional perks of membership for certain airlines or hotels as long as you keep the cards open. These cards will give you low/mid tier elite status outright (Hyatt Platinum status or Hilton Silver status) or at least some of the elite benefits (free checked bags and priority boarding).In this case, you meet (sign up & get the card), take them out once (spend the minimum required), get what you want (the sign-up bonus), but booty call them every so often when they come in handy for specific situations like a business trip where you're flying on your non-primary airline or visiting friends in a town without your primary hotel chain.
The ones in my father's wallet includes:
A. American Express Hilton HHonors (low-tier Silver status - late checkout; free bottled water)
B. Chase Hyatt Visa (mid-tier Platinum status - free internet, late checkout; 1 free night a year in a Category 1-4 Hyatt hotel)
C. Chase Priority Club Visa (top-tier Platinum status - room upgrades, late checkout, free internet; 1 free night a year in any Intercontinental, Crowne Plaza or Holiday Inn)
D. Citi American Airlines Visa/Amex (free checked bags; priority boarding; 10% miles back on award redemptions)
E. Barclays US Airways Mastercard (free checked bags; priority boarding; two $99 companion passes annually; 5k mile discounts on award redemptions; 10k bonus anniversary miles every year)
F. American Express Platinum ($200 airline credit vouchers/year; airport lounge access; Starwood Hotel mid-tier Gold status; access to American Express Fine Hotels & Resorts bookings; $100 credit for Global Entry application fee)
You'll notice that some of the cards are also on the One Night Stand list. That's because (as several of you can attest) sometimes a One Night Stand turns into a Booty Call when the need arises. Because they offer certain benefits every year as long as you have the card open, it may make sense to pay the annual fee and keep beyond the first year. But that depends on if you'll use the Booty Call card benefit like the 1 free hotel night (whoa, I wasn't even trying to make that connection).
Then finally come the keepers - the cards that are so amazing and make it so compelling to have that you don't mind As before, sometimes the Marriage cards are also great One Night Stand and/or Booty Call cards. They're not mutually exclusive.
But I repeat this theme again, it always depends on your individual situation. You may live in Manhattan and not have a car, so the extra points on gas are worthless to you. You may be on a strict diet/budget and avoid restaurants completely. You may be reading this blog post because you don't have extra money to travel, so getting 2x on paid airfare isn't worth anything to you. Some people prefer brunettes and others blondes. To each their own.
But if you do have a meaningful amount of spending in these certain bonus categories, you can get to your SMART travel goal 2x as fast if you have one/some of these cards that my father has:
A. American Express Starwood (1x on all spend, but can be transferred to airlines at 1.25x; also the only real way to get a large balance of hard to earn SPG points without staying weeks in a hotel)
B. Chase Sapphire Preferred Visa (2x on dining and travel, including Dunkin Donuts and MTA metrocards)
C. Chase Freedom Visa (5x on rotating categories every quarter that include groceries, restaurants, gas stations, retailers)
D. Chase Ink Bold Mastercard (5x on cell phone, internet, office supply stores)
E. Chase United Select Visa (Up to 5k elite qualifying miles for $5k United spend; 3x on all United spend)
F. Citi Thank You Preferred Visa (5x on gas, groceries, & drugstore)
If you're like my parents, most of your monthly expenses is your housing (rent or mortgage). But after this elephant expense, the majority of the balance falls into at least one of these bonus categories above. So why earn only 1 point per dollar when you can get 2-5x?
And since my parents learned how to communicate in their marriage retreat, I thought I'd end with this.
"I feel excited when you earn thousands of points for spending on things we'd normally buy anyway and use those points for free/cheap travel."
"I can imagine you're thinking how amazing our vacations will be from now on."
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