Developing a secondary strategy for Credit Card Rewards Points

In previous posts about credit rewards strategies, I’ve talked about how to develop a rewards strategy, discussed why I use the Starwoods American Express and Schwab Visa as my primary cards, and talked a little bit about how I’ve earned extra SPG points buyingcoins from the U.S. Mint. Now it’s time to talk about secondary strategies for earning rewards points.

So you understand your goals and spend profile and you’ve picked a card that matches these two things, but you are thinking, “There are so many rewards programs”, you begin to wonder if you can take advantage of a few more programs. The answer is a resounding Yes! Let’s talk about secondary strategies for a minute. The way I view secondary rewards programs where it can either help contribute to an overall goal such as travel or you obtain one time bonus for things like gift cards or cash back. In other words, the credit cards that are part of your secondary strategy should include those cards with sign up bonuses. Let’s discuss a couple of examples.

I recently signed up for the American Express Rewards Plus Gold card and the Business Gold Delta Skymiles card. Both of these cards had sign up bonuses if I spend a certain amount of $ within the first 3 months of getting the card. My intentions are to fulfill the spend requirements for the sign up bonuses by ordering coins from the U.S. Mint. This way I do not have to divert any of my real spending away from my Starwords American Express card to earn those valuable SPG points.

The specific bonuses offered by the two American express cards were 30,000 skymiles and 15,000 membership rewards points. Now, in prior posts, I have alluded to the fact I am in the process of dumping all my NWA/Delta frequent flyer miles due to the massive devaluing of the program. These 30,000 miles will help me get close to having a 120,000 remaining miles to use on award travel. If I am lucky and search diligently enough, I will be able to find a perk saver business class award ticket to Asia.

In regards to the gold card and the reason for getting that, I currently have about 135,000 membership rewards points. Amex membership rewards points are similar to SPG points in that they can be converted to miles in frequent flyer programs. Additionally, if I so choose, I could convert the points to SPG points at a 3 Amex points to 1 SPG point redemption ratio. So with these 15,000 membership rewards points, I have the possibility of another 5,000 SPG points. I’m still in the process of determining if a conversion is the right way to go on this. I’ve also read that converting to Air Canda miles is another step in the right direction because of their generous award ticket policies of 2 stop-overs with one going across the Atlantic Ocean and the other going in the direction of the Pacific Ocean. My decision on which program to convert to will depend on how many SPG points I have at the end when I am trying to book my round-the-world trip and how I decide to book the travel (a bunch of one way award flights or one massive ticket).

If you can not tell, my primary goal for rewards points is travel. These two cards help me towards that goal even though after I fulfill the spend requirements for the bonus points, I will not use them again. In fact, I will probably cancel the Delta Gold Card. Additionally, I will my business Amex gold card. The reason I hold on to an Amex gold card is because I want to keep the membership rewards points and not have to spend them. So on a yearly basis, I find another Amex gold card with a sign up bonus and free annual fee the first year and I can continue to keep my membership rewards points.

Your primary goal may be cash back or you may come across an offer for an amazon giftcard or just a random $250 cashback that may have nothing to do with your primary goal at all! Maybe you have planned a big purchase at Amazon.com and could use that amazon giftcard or cashback. My suggestion is do not shy away from those opportunities. I recently applied for a chase sapphire preferred card. The bonus points being offered was 25,000 after the first purchase. I don’t even have any ties to any chase reward program, but I figured I could make use of those 25,000 points some how! This is what I mean by take advantage the opportunities. Of course if Chase approves me, I will get the bonus points, figure out the best use for them and close the card 3-11 months later. You can do a similar thing with Citi thank you points – apply for those cards that offer thank you point bonuses, cancel them in 3-6 months, apply for a different card with a thank you point bonus, and continue this process. I have even read of people applying for the same card a year or so later and getting the sign up bonus again!

Now, I will add a couple of caveats here. I caution you against applying for a large number of cards if you’re looking to get approved for a loan in the near future. Also, make sure you understand the terms for getting bonus points and if there are any annual fees involved. Typically, it is best to look for cards that are at least fee free the first year. Additionally, you do a need a decent credit score of 720+ to fully execute this strategy. These are just a couple of additional points to keep in mind.

There are many rewards points programs and credit card offers out there. Developing a secondary strategy that is geared towards your primary goal can help you realize your goal even quicker. Additionally, if you find one of those really good offers like $250 cash back or a $250 giftcard, jump on it! Sometimes it doesn’t matter if the offer helps you towards your primary goal or not if it is really good!

Feel free to leave your suggestions in the comments for your primary and secondary rewards earning strategies.

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