New Cards - Citi Thank You Prestige and Chase Ink Plus

This month, we decided to open up a few more credit cards as our rewards balances started running low.

Citi Thank You Prestige
First, my father signed up for the Citi Thank You Prestige Mastercard. The regular offer is as follows:

A. 50,000 Thank You points after spending $3,000 in 3 months.
B. $450 annual fee (not waived)

However, instead of applying online, my father went to a physical Citi branch office and applied with a real life banker. Why? Because the sign up offer he was given was as follows:

A. 30,000 Thank You points after spending $3,000 in 3 months.
B. Additional 30,000 Thank You points after spending a total of $15,000 in 12 months (so $12k more after spending the first $3k)
C. $350 annual fee (forever)

But even $350 just to have the card in our wallet is a lot of money. There's been tons of other websites that sell explain the benefits, but here's why my father signed up.

• $250 each calendar year of Airline Reimbursement. So for 2015 and 2016, we can get back $500 of total airfare spend (which in my family, is as good as cash) before our first card member year comes.
• $100 Global Entry Application reimbursement. My parents and I already have Global Entry, but my grandmother does not. Since Citi doesn't really know or care WHO specifically applied for Global Entry, we can use our Prestige card to pay for my grandmother's application fee. 
• 4th Night Free Hotel Benefit. We haven't yet used this feature, but given how much we travel, it's a safe bet that we'll have an opportunity over the next 12 months. But even if all of 2016 comes and goes without us using this perk, we'll still have done better than the $350 fee.
• Free American Airlines Club Lounge Access. We don't often fly American Airlines, but if we ever did, I'm sure we'd prefer stopping at the lounge before our flight.

Chase Ink Plus

The second card we opened was the Chase Ink Plus card which comes with $95 annual fee, but also with a 60,000 Ultimate Rewards point bonus (after spending $5,000 in 3 months).

This card, however, is for small businesses. Luckily for us, my father had an eligible small business that needed a new business card. 

While this offer did not waive the $95 annual fee the first year, it did come with an extra 10,000 bonus points more than the standard 50k offer, which we value at $200 (2 cents/pt). 

So it was a good trade off, especially since we just redeemed 150,000 Chase UR points for 2 rooms at the Andaz Papagayo for 5 nights each at our upcoming Costa Rica vacation. That redemption gave us a value of 2.4 cents/point.

So now, we have to spend approximately $8,000 in November, December and January and another $12,000 through October 2016. Of course, the entire point of this game is to NOT spend more than we would otherwise in our regular lives, so it will be a matter of shifting our everyday spend onto these cards (groceries, gas, bills, restaurants, etc).

High Spend Targets

As you know, we accumulate a lot of our frequent flyer miles, hotel points and bank reward points through credit cards.

Most of the benefit, however, comes from initially signing up and reaching the minimum spend (which ranges from $1,000-5,000 within 3 months most of the time).

Some also offer perks just for having the card (priority hotel elite status, priority boarding on airlines).

Then there's the spending bonuses for using your card at certain merchant types (2-5x at groceries, office supply stores, hotels).

The fourth type of benefit is for reaching high levels of spend in a given year. These targets have rewards that are very attractive to people like my father who enjoy gaming the system. There are several cards that have these high spend targets, but we'll only discuss the ones my parents have actively. You can research the rest on your own.

Chase Select Visa - $25,000

For example, for spending $25,000 a year on our Chase United Select Visa allows United MileagePlus members to avoid the Premier Qualifying Dollar (PQD) threshold for earning elite status. Normally to hit United Silver, you'd have to fly 25,000 miles AND spend at least $3,000 in base fares.

Given we take advantage of super cheap fares (such as the $815 fare to NYC from Tel Aviv or the $266 flights to Costa Rica), we hardly ever reached the PQD minimums for United Silver or Gold status.

Citi Hilton Reserve Visa - $10,000

Another example is the $10,000 spend on the Citi Hilton Reserve Visa. For doing so, we get a free Hilton Weekend Night Certificate good for just about ANY Hilton property in the world.

Last year, we used it for my grandmother's stay at the Conrad Hong Kong). Normally, the Conrad Hong Kong would cost 80,000 Hilton HHonors points, so this certificate was a great value for my family. And since we hit $10,000 this year as well, we'll get another free weekend night certificate to use in 2016.

And if we ever hit $40,000 in a year, we'd get upgraded to top tier Hilton Diamond status. That sounds pretty amazing, but we question if the incremental benefits of being Diamond (vs. a mid-tier Gold which already gets you free breakfasts) is worth it. After all, that's an extra $30k of spend we'd have to forego on our other cards.

Starwood SPG American Express - $30,000

Our Starwood SPG American Express also offers mid-tier SPG Gold status if you spend $30,000 in a year. For late checkout and a modest room upgrade to a better view, it's a nice mid-tier status to have.

But since my father has Platinum status, we don't go out of our way to hit this SPG Amex high spend goal -- though admittedly, some years we hit it without actively trying to do so.

Citi Thank You Prestige Mastercard - $15,000

This card doesn't really fall into the same category as the others. Rather than being a recurring high spend benefit, the Citi Thank You Prestige card offer we received when we signed up was as follows: 30,000 Thank You points after spending $3,000 in 3 months PLUS another 30,000 TY points for spending $15,000 in the first 12 months.

The "regular" offer is 50,000 miles after spending $3,000 with a $450 annual fee, but my father wanted the special $350 annual fee offer which happened to be the 60k points for $15k spend in the first year offer.

Conclusion
Having been fortunate enough to hit both the United Visa and Hilton Reserve Visa targets earlier this 2015 year, now we can focus our extra spend on the $15,000 target for the Citi Thank You Prestige Mastercard over the next 11 months, having already hit the $3,000 first target in Month 1.

But as soon as January 1, 2016 comes around, we're back to the races with the United and Hilton Reserve Visa cards. Thank goodness for being able to use our 5 Nationwide Buxx cards to load/unload $5,000 each month.

Citi Thank You Indeed

We've been big fans of Citi Thank You points. The combination of (a) being so easy to earn and (b) great redemption opportunities, we've earned and burned hundreds of thousands of Citi TY points over the years.

In particular, we've had special promotions like an additional 2x points on all spend for 6 months or $95 statement credits to offset the annual fee. Then there's the standard bonus categories such as 2x for Restaurants/Entertainment.

With a substantial stash of Citi TY points, we decided to use some for an upcoming long weekend in Florida this coming December.

First, we booked our United flights for 67,488 TY points, which saved us $844 for three round-trip tickets. Second, we booked an Enterprise Rental car for 4 days for just 9,200 TY points, which saved us $115. That's almost $1,000 of savings for a 4 day vacation!

To redeem Citi TY points, you need to book travel directly through their portal. The prices they show are generally the same as what you'd find by going directly to the airline or car rental websites. For example, our United tickets were the same price on Citi's site vs. United.com.

However, the car rental prices were actually cheaper on Citi's Travel site. Here were the prices on Orbitz.com. For the same Enterprise Compact car, they were charging $133 (vs. the $115 price we booked using Citi TY points).

Because we're having so much luck with Citi, we decided to open a new Citi Thank You Prestige card this past week which offers 60,000 TY points and has a reduced $350 annual fee, but with enough perks and benefits where my father will recoup that fee (and then some) easily in the first year.

Flight Deal Good Fortune

The Flight Deal is an amazing website/blog that posts great opportunities to travel very cheap. For example, they were the ones that told us about the $400 flights to Buenos Aires that we took in 2013 and the $400 flights to Tel Aviv that we booked (but ultimately had to cancel).

Because their search algorithm finds such amazing fares, my father has it on his Feedly Blog Reader. He's constantly checking for deals on flights that might be of interest to our family because if a deal appears, you have to quickly pull the trigger before the window shuts.

Around 11PM on Thursday night, they posted a deal for cheap flights between NYC and Chicago.

As it turned out, we were planning to visit our friends in Chicago later this fall, so we took the Flight Deal post as an omen. After searching on Google Flights, we found a great weekend fare for just $189/person. While not as amazing as the $166 fares marketed by The Flight Deal, those flights were for mid-week departures which made it tougher for my family due to work/school schedules. Normally, flights between NYC-Chicago usually go for $250-350/person, so this was a steal.

Citi Thank You Points

Plus, we had another opportunity to get these flights for FREE. Because we had about 165,000 Citi Thank You points, we were much better off using these points instead of cash.

Each Citi Thank You point is worth 1.0 cent usually, but since my mother had the mid-level Citi Thank You Premier credit card ($95 annual fee), we could redeem them at 1.25 cents each instead. So for the 3 of us in my family, we had the following payment options:

A. $568 in cash ($189/each)
B. $568 in United credit (which we bought for just $473 thanks to American Express)
C. 56,760 Citi Thank You Points (if we didn't have the Premier card)
D. 45,408 Citi Thank You Points (because we had the Premier card)

Clearly, we went with Option D and saved 11,352 Thank You points and saved the money/credit for another day.

Points and Mile Totals

Some of my classmates at pre-school have been asking me lately how many points and miles we have. I generally just say "this much" as I stretch out my hands, but in the interest of transparency, I'm willing to share our family totals to all 3 loyal readers of Lap Child Diaries.

Airlines
American AAdvantage - 600,000 miles
United MileagePlus - 400,000 miles
British Airways Avios - 215,000 miles
Aegean Airlines - 60,000 miles

Hotels
IHG Rewards Club - 113,000 points
Hilton HHonors - 104,000 points
Starwood SPG - 102,000 points
Club Carlson - 18,000 points
Hyatt Gold Passport- 600 points

Bank Rewards
Chase Ultimate Rewards - 392,000 points
Citi Thank You Points - 165,000 points

Now clearly, there are families (and even individuals) out there that have 1,000x more than we do, so we're really not trying to show off. We're just answering a question we get often, and there's no shame/pride here.

The truth is that these points and miles will only decrease in value over time. Programs "devalue" their points from time to time by increasing the prices for award redemptions, so we recommend not hoarding these rebate currencies. Cash you can save, but with loyalty points and miles, you should "earn and burn" as quickly as possible!

Any good redemption ideas for us?

Retention Check In

It's actually been a (relatively) long time since we applied for new credit cards. Instead, we've been focused on maximizing earnings with the credit cards we already have.

But our current Extra 2x Citi Thank You promotion was coming to an end on July 31st. So we decided to stir up the pot and see if we could get another one.

Attempt #1
My father called the phone number on the back of his Citi Thank You Premier card. Even thought we paid the $95 annual fee in April, we haven't used the card since earning our Year 2 bonus.

My father: "Hi, I'm not sure we're using this card anymore. Are there any incentives for me to use it more on purchases?"

CSR:  "I'm sorry, sir, but I just don't have anything available for you. You should call back in 6 months."

My father: "OK, then can you check on my other Citi cards as well?"

According to her, there were no offers available from the representative.

That could have been the end of the story, but you know my father loves the HUCA (Hang Up Call Again) tactic.

Attempt #2

A few minutes later, we called back and this time, my father changed his approach.

My father:  "Hi, I'm not sure continuing to pay the annual fee on this card is something I want to do. I'd like to cancel the card."

CSR: "OK, I can help you with that. Please hold while I transfer you to a specialist."

Specialist:  "You've been a loyal customer of ours since 2013. I may have an offer that you want to consider..."

They offered my father (i) a $95 statement credit and (ii) 1,000 extra Thank You Points for spending $1,000 each month for 3 months.

Of course, he asked if there were other offers. He was given a slightly different one where he would get just a $95 statement credit if he spent $3,000 within 3 months. The first offer was better, even if it was a little more complicated to execute. But if you know my father, he loves these kinds of puzzles.

Before hanging up, my father then inquired from the Specialist if she could check his other Citi credit cards for other offers and promotions.

Low and behold...

Specialist:  "Well, it looks like there are 4 offers you're eligible for..."

1. 10,000 Thank You points for spending $3,000 in 6 months
2. 15,000 Thank You points for spending $4,500 in 6 months
3. 7,500 Thank You points for spending $1,000 in 3 months
4. An extra 2x on your spending for next 6 months up to 35,000 bonus points

So of course, my father picked #4.

Conclusion
Never take "No" for an answer with credit card companies. While the first line of Consumer Service Reps may not be authorized to make any offers to retain you, so sometimes you have to HUCA and get to a Specialist by saying those magic little words..."I"d like to cancel."

Citi American Airlines Mastercard Retention

My father was reviewing our credit card spreadsheet when he saw that my mother's $95 annual fee was going to come due in June for her Citi American Airlines Mastercard.

They applied for the card mid-May 2014 and quickly spent $3,000 in the first month to receive the 50,000 American Airlines AAdvantage miles. These miles were ultimately used to give my grandmother a first class flight to Korea on Japan Airlines.

For the first year of the card, the $95 annual fee was waived. But now we were going to have to pay the fee just to have the card another 12 months.

As any cheap good spouse would do, he called into Citi to let them know that they didn't "plan the use the card enough for the next year to pay the annual fee." The representative then asked, "So you'd like to cancel because of the annual fee?" which my father knew was the magic confirmation she needed to transfer them to a Retention Specialist.

We were immediately reminded about the American Airline card benefits (10% mileage rebates on AA award redemptions, priority boarding, etc.). But when we stuck to our guns, she said she would like to retain us and gave us an offer to do so.

We were told that if we spent $95 in eligible purchases, then we would receive a $95 statement credit. This meant that we'd get a free $95 to spend - which coincidentally is the same exact amount as the annual fee. I suppose there's some legal rationale why they do it this way (vs. just waiving the annual fee directly), but it ends up almost the same to my parents. More on that later.

Then my father pushed the envelope and said, "this offer is very generous and makes me want to keep the card another year, but are there any promotions that would actually encourage me to use it more often? Other cards are offering a lot of bonus spend categories (2x-5x)."

She said there was another mutually exclusive offer instead of the $95 statement credit. This other offer was 7,500 extra American Airline miles if we spent $1,000 in the next three months. If you value the AA miles at about 2 cents/pt, then that would be $150 for the bonus 7,500 miles (plus the $20 for the 1,000 miles on the actual spend).

While those values seemed to be worth more than the $95 annual fee, we decided to stick with the original offer as we prioritize cash in hand over padding our already large piles of AA miles.

So we took the first offer and will wait a few days for the promotion to be activated on our account. Then after the statement credit hits, I suppose we can still have time decide if we want to pay the annual fee or not...

3x Bonus Citi Thank You Preferred

Usually, my parents would call up and ask for a retention bonus for cards that have an annual fee coming up. For example, we called up Chase a few weeks ago and received a $100 statement credit to offset the $95 annual fee due in a few weeks.

But apparently, we should have also been calling up our no-fee cards as well. The banks also want to incentivize you to spend on all their cards.

So after reading about Miles to Memories' retention offers on the Citi Thank You Preferred (the no-fee version of the Citi Thank You family), we called about my mother's card. After stating that we were thinking of closing the card, we were eventually offered a great promotion.

1. Spend $1,000 each month for 3 months and receive an additional 10,000 Thank You Points.

However, we knew to hold out for an even better offer.

2. Get an additional 2x Thank You Points for every eligible dollar spent in the next 6 months.

JACKPOT!

Since my father is a math nerd an Asian, he quickly did the math of how much spend he would have to make to be break-even between the two offers. Under the first offer, he would get 13,000 points for $3,000 of spend, which is about 4.33x for that initial $3,000 of spend. But then 1x on any additional spend.

But under the second offer, we could earn more points if we spent more than $5,000 over 6 months. At that spend level, we'd clear at least 15,000 points. And if some of that spend was on dining/entertainment, we'd get even more. Those two categories normally get 2x, so they'd earn 4x under this promotional offer.

And yeah, trust me. My father will find ways to spend more than $5,000 in 6 months.

Ugh, too much math for one day...

Retention Year 2

Last year, my father called up his favorite banks and asked if there were any offers to compel him to keep their credit cards open for another year. After all, spending $65-95 every year for each premium credit card can start to add up... especially when we have 30+ cards. So either (a) the banks will have to give him more than that in value each year or (b) will have to waive the fee.

Some cards that we will keep open forever include the Starwood American Express cards (as it helps us re-qualify for Starwood Platinum status each year, offers 2x on Starwood spend and has great Amex promotions) and United Select Visa (as it helps my father re-qualify for United Gold status each year and offers 3x on United spend).

But coincidentally, these were the ones we threatened to cancel last year in the hopes to receive an attractive retention offer. Recall that last year, my father received 2,000 SPG points in exchange for paying the $65 annual fee for his SPG Amex and an additional 5,000 United miles for paying the $95 annual fee for his United Select Visa.

But every year is different.

This time around, my father called Amex and asked to be transferred to an Amex Retention Specialist. My father said he was doing some planning for which credit cards to use and which to cancel for 2015, then asked if there were any upcoming Amex promotions he should know about. Unfortunately, he was told that since he received a promotional offer last year, he was ineligible for another one this year. No harm, no foul.

He did, however, fare better with Chase when he called to inquire about his United Select Visa. This front line customer service representative was authorized to offer my father a $100 statement credit if he kept his card open another year. That would more than offset the $95 annual fee, so he was actually being paid $5 to keep the card. This offer was on top of the regular 5,000 United miles that he receives each year anyway.

Then another day, we called for my mother's Chase British Airways Visa. We signed up a year ago when they were offering 100,000 BA Avios for spending $20k in the first 12 months. We used those BA miles to fly us to Chicago last year and to fly our friends to Orlando last week. When we discussed waiving the annual fee, they told us it wasn't an option. So we told them we'd like to close the account. Then came an offer to give us 9,000 Avios for spending $1,500 in the next three months. That comes out to 6x vs. the usual 1.25x per dollar spent.

So my father accepted that offer and kept the card open. We quickly found a way to spend $1,500 in a few transactions that week and now are awaiting the bonus to post in the Feb 1st statement. Even though we receive the bonus, we'll still close the card afterwards, since the bonus was only contingent upon spending $1,500 on the card and not paying the $95 annual fee.

We still have to call Citi (for my mother's American Airlines Amex) and Barlcays (for my father's US Airways Mastercard), but we'd be OK with closing those down if no compelling offers are made.

[UPDATE: For my mothers American Airlines Amex, we were given a $95 statement credit if we made a $95 purchase, which was actually $10 more than the $85 annual fee. For my father's US Airways Mastercard, they refunded him $89 for the annual fee, though he was only charged $44.50 for the annual fee.]

Balloon Fiesta Weekend

Flight #96-97 - United 1494 and 3855 
Newark (EWR) – Albuquerque (ABQ)
Friday, October 10, 2014 
Depart: 7:00AM / Arrive: 12:31PM
Duration: 7hr 31min (incl. 2 hr layover)
Earned: 1,953 miles
Cost: 30,813 Points + $112 / person
Redemption Value: 1.25 cents / mile
Lifetime Miles: 187,437 miles 

Well, it's another long weekend coming up (thank you Christopher Columbus), so we're off again. This time, we're heading to Albuquerque, New Mexico.

As you can tell, my parents enjoy all sorts of destinations ranging from relaxing poolside at a resort, to hiking in the mountains, to sightseeing in major international capitals. This trip, however, is more of an event destination as we're going to the week-long International Balloon Fiesta they have in Albuquerque each year. Yeah, talk about random...but awesome.

My father actually booked our hotel way back in January just to make sure we could secure a room at a convenient location.

That was early enough to snag 3 nights at the Holiday Inn Express Balloon Fiesta Park, which is actually walkable to the center of the ballooning action. Given peak rates for the Fiesta, we used IHG points (20,000 pts/night) instead of paying the cash rates of $200/night that they rooms were going for at the time.

Since most hotel award booking are fully refundable, we had a free option until we decided to actually make the trip. Thankfully we had secured rooms early enough, because when we checked a few months later this summer, every proper hotel in the area was fully booked!

Around mid-July, it was clear that we were going to have Columbus Weekend free, so we decided to commit fully and book our flights. Wow, talk about peak Fiesta pricing! Flights from Newark were going for $493/person with a connection each way.

There were some other options though. We could have taken a direct flight from JFK on JetBlue for about the same price or we could have used the $99 Companion Passes on US Airways we received for having the Barclays US Airways Mastercard.

That certificate would have saved us about $700, but we would still have had to (a) pay $800 in cash and (b) fly on US Airways via Phoenix (no status, long flight, old planes, no in-seat entertainment, no power outlets, mediocre service, have to fly into JFK). Ultimately, my father decided to save the Companion Passes for another trip in the future where (i) the cash prices were high, but (ii) the actual flight was short.

Fortunately, my parents still had about 92,440 Citi Thank You points that could be redeemed for $1,156 of airfare credit (at 1.25 cents/pt). After using all those TY points, we only needed to come out of pocket for the $337 balance. Paying just $112 cash per person isn't too shabby for a round trip flight during a peak event time. Plus, we'd get free checked bags, priority boarding and lounge access for our layovers.

But the biggest benefit for choosing United was actually that my father really wanted the 1,953 Premier Qualifying Miles (PQM) to hit 50,000 this year and re-qualify for MileagePlus Gold Status next year. Because the short flight from DEN-ABQ will be counted as 500 minimum miles, he will be at exactly 50,010 PQM on United after we land in Albuquerque.

That's not a coincidence. I did all the calculations myself.

Switching Strategy to Cash Back

Last week, I shared my parents' strategy of getting 5.5% rebates back for our day care. Now clearly, that post was just highlighting one example of a larger theory that can be applied for any non-bonused spending. But sometimes, I forget that not every one of my readers follows every subtle point of all this madness.

There are definitely people out there who would much rather just stick to a single credit card to use for all their spending. That's perfectly fine for those people.

But my father's obsessed with "optimizing" everything. I'd truly worry about him if his "hobby" didn't let us travel so frequently for so cheaply. He has our family using anywhere between 1-4 different cards depending on what store or what kind of purchase we're making.

Some of my readers have said they have a hard time keeping up with how my family decides on which points to earn / which credit cards to use. Here's a basic rundown:

1. Rent - checking account (no points)
2. Groceries - Amex Blue Cash card (5% cash back)
3. Restaurants - Citi Thank You Premier (3x Thank You points)
4. Cell Phone / Internet - Chase Ink Bold (5x UR points)
5. Domestic Travel
   a.  United Flights - Chase United Select (3 United miles)
   b.  Starwood Hotels - SPG Business Amex (2x SPG points)
   c.  Hyatt Hotels - SPG Business Amex (5% back + 1 SPG point)
6. International Travel - Citi Thank You Premier (2x TY points)
7. Other

   a. Amazon / Chain Retailers - Chase Ink Bold (5x UR points by buying retailer gift cards at Staples)

   b. Everything Else - ???

So before we starting re-thinking our points/miles strategy, the conventional wisdom was to use our SPG Amex for #7b (anything that wouldn't earn a special bonus). The thought was that if you don't get 2-5x, then you should just earn the "most valuable point currency" which was a SPG point (valued by many at 2.5 cents/pt). The other popular alternative was the Barclays Arrival+ card (earning 2.2% rebates on travel).

However, as we talked about last week, we could also earn 5.5% rebates on everything (4.2% cash and 1.25% flight rewards) by simply combining our Amex Blue Cash, Citi Thank You Premier and Paypal Debit cards. If you need a refresher, click here.

So essentially, if my father chose to spend $1 on his SPG Amex for non-bonus categories, he would be forgoing 5.5% of rebates (the opportunity cost). That actually means he is essentially "buying" 1 SPG point for 5.5 cents each. Given our typical SPG redemptions range from 2.5-4.0 cents/pt (including our most recent 5 night award stay at Westin Costa Navarino), we'd actually be better off by earning cash rebates and using that saved cash to pay for the Starwood hotel reservations directly.

Let me walk you through an example.

Imagine we need to spend $1,000 a month for daycare again. Since, it's not a bonus category, we'd most likely use our SPG Amex and earn 12,000 SPG points every year. That's enough points to book 1 night at a Category 5 Starwood hotel such as the Westin in Sydney, Australia (~$390 USD/night in November).

However, if we used our Amex Blue Cash card and bought 24 Paypal My Cash cards ($500 loads + $3.95 fee each card), we'd have $12,000 worth of Paypal funds and have paid $95 in load fees. For spending $12,095 on our Amex Blue Cash card, however, we'd earn $605 in rebates - or $510 of net profit (in cash). Then he'd also earn 12,000 Citi Thank You points for the actual daycare spend on his Citi Premier card, which he would pay off using funds from his Paypal Debit card.

With that $510 of cold hard cash, my father could just pay $390 for the 1 night at the Westin Sydney and still have $120 left over. PLUS, he would earn 3x SPG points for his actual stay and 2x Citi Thank You points for paying for the stay (another 1,170 SPG points and an additional 780 Citi Thank You Points). Here's a side-by-side comparison to help illustrate the point.

Yes, we know that a solid counter-argument could be, "Why don't you just spend on your SPG Amex, and then withdraw money from your Paypal account to your bank account.Then just pay off the Amex?" That's very sound logic in theory, but in practice, a constant loading of your Paypal and withdrawl to your linked bank account will almost certainly flag your Paypal account and get you shut down. The beauty of the "Paying Citibank with your Debit Card" is that it looks more like a "normal transaction" to Paypal's automated risk management system. The marginal extra value of an SPG point over a TY point isn't worth risking the entire gravy train over.

So back to our example. Assuming those SPG and Thank You points are worth 2.5 and 1.25 cents/pt, respectively, that's $29.25 and $159.75 of additional value. Then throw in the residual $120 of cash rebates left over, we have $309 of value when all is said and done after our 1 night hotel stay. Seems like a no-brainer!

Getting 5.5% Cash Back On Our Day Care

I guess I've been on a bit of an American Express kick these days, but that's just because they have so much to offer a young toddler and her life-hacking parents.

Today, we'll talk about the "old" Blue Cash from American Express. This card gets you 5% cash back on your U.S. supermarket, gas station and drug store spend (after your first $6,500 of spend each calendar year). The beauty of this deal is that this credit card is still available per this FlyerTalk Thread.

My mother applied for this card in early January this year, and we cleared the first $6,500 of spend quickly while we were in Texas. Then, every dollar we spent at Trader Joe's, Fairway, Whole Foods, CVS, Duane Reade, Rite Aid and Walgreens earned us 5% cash back for the rest of 2014.

Unfortunately, one of our larger monthly spends - my daycare - doesn't qualify as a grocery store, gas station or drugstore. However, my father was able to secure the ability to pay my daycare with our credit card without a 3% surcharge. Now, here were our payment options (in order of least to most complicated/rewarding).

1. Pay Directly (2.2%).  Clearly the easiest (and least rewarding) way to pay each month would be to use one of our many Visa/MC cards directly. Perhaps we'd use our Barclays Arrival+ card to get us 2.2% rewards back. Or our Chase Freedom card earning us 1.1 UR points per dollar (worth about 2.2%).

Nothing out of the ordinary here. But here's where having the Blue Cash Amex can come in and supercharge our regular spend.

2. Use BC Amex to Buy Visa Gift Cards (4.0%). By using the BC Amex at a grocery store or drugstore, we can find any number of Visa Gift Cards, such as the OneVanilla. Each one of these cards can be loaded up to $500 with a fee of $4.95. So for spending $504.95, we'd earn $25.25 in cash back. Net of the load fee, we're clearing $20.30 of profit.

That's still about 4.0% cash back, net after fees! Almost double Payment Option #1 above. But when you combine another "trick" with the BC Amex, you can squeeze just a bit more juice.

3. Use BC Amex to load Paypal Debit (5.2%). But since my parents also have Paypal accounts supplemented with the linked Paypal for Business Debit Card, we can get yet another 1% plus save $1 on each load. The Paypal My Cash reload cards have a $3.95 fee vs. the One Vanilla $4.95 load fee.

Then once it's loaded onto our Paypal Debit Mastercard card, we can use it to pay the daycare directly and we'd earn 1% for using the debit card like a credit card (signing instead of using a PIN).

So we earn 5.0%, lose 0.8% on load fees, but get back 1% for using the Paypal Debit like a credit card. Net total is 5.2% earnings or $26.25 cash back. But wait...there's more!

4. Use Citi Visa, BC Amex and Paypal Debit Card (5.5%+). OK, this is clearly the most complicated option and many of you may will wonder if my parents are just OCD crazy. But my father can never turn down extracting as much value as he can, especially when everything can be done within walking distance, over the phone or with a few keystrokes online.

This option is basically combining #1 with #3. The reason we can do this is because Citi has a unique feature where their premium credit cards (i.e., Citi Thank You Premier) can be paid off over the phone using a bank debit card. See here for the FlyerTalk thread on it. Because of this "trick," we can basically double dip.

First, we use our Citi Thank You Premier Visa to pay our daycare directly and earn 1 Thank You Point per dollar (1.25%).

Second, we go buy a $500 Paypal My Cash reload card ($503.95 with fees) and earn $21.25 in net cash rewards (4.2%). We load up this debit card so that we can use it to pay off the Citi Visa card we used to pay the daycare.

Third, we call up the number on the back of our Citi Visa and ask for a representative so we can pay off our balance with our "bank debit card" (they don't need to know it's actually Paypal). Now, you may get phone representatives that claim you cannot pay off your balance with a debit card, but that's simply not true. Just hang up and call again.

Conclusion. So at the end of the cycle, we just end up with a balance due on our Blue Cash Amex card. And for all the steps in between, we're rewarded with 500 Citi Thank You Points worth at least $6.25, plus another $21.25 in Amex cash rewards for a total of at least $27.50 (5.5% back).

Not too bad for a monthly expense like daycare that we were going to have to pay for anyway.