How to Earn $10K/Year with Cards (Up to 20% Cash Back)

00:00:00.000 | There are so many different credit cards that can help you maximize your rewards

00:00:03.960 | across dozens of spending categories.

00:00:06.120 | But what if a single card could not only simplify your wallet,

00:00:09.440 | but also maximize your earnings?

00:00:11.400 | Today, I'm diving into the best single cash back cards

00:00:14.800 | that go way beyond earning just 2%.

00:00:17.200 | There's so many new options, including cards that earn up to 4% back

00:00:20.760 | on all your spending.

00:00:22.080 | So I'll break down the top contenders, their pros and cons

00:00:24.880 | and how to choose the right one for you.

00:00:26.800 | And then I'll throw a little bit of a wrench in it all

00:00:28.800 | and tell you about an even better way to be earning 13% or more back

00:00:33.360 | on all your spending.

00:00:34.760 | I'm Chris Hutchins.

00:00:35.600 | If you enjoy this episode, please share it with a friend

00:00:37.920 | or leave a comment or review.

00:00:39.560 | And if you want to keep upgrading your life, money and travel,

00:00:42.240 | click follow or subscribe.

00:00:44.880 | OK, first, I want to talk about the best cash back cards

00:00:47.760 | because a lot of things have changed.

00:00:49.520 | In episode 170, I had an episode called cash back versus points,

00:00:53.040 | and I made a case for cash back then.

00:00:55.400 | But this felt like it needed an update

00:00:57.240 | since there's been a lot of changes, most specifically

00:01:00.040 | the U.S. Bank Smartly card, which has really forced a lot of people,

00:01:03.680 | myself included, to decide how much we really value our points.

00:01:07.480 | Today, I want to talk about the best single cash back card

00:01:10.600 | we can have in our wallets.

00:01:11.840 | And by that, I don't mean the U.S.

00:01:13.400 | Bank card.

00:01:14.000 | If there is just going to be one card we can have to handle

00:01:17.440 | the everything category, anything you want to spend money on,

00:01:20.400 | what that card would be.

00:01:22.040 | And there's a few options.

00:01:23.360 | And then what that means for the points game.

00:01:25.760 | That said, I'm not going to cover everything I did in that episode.

00:01:28.840 | So if you want to go deeper and listen to the best cash back cards

00:01:32.080 | for every spending category and how I think about points versus cash back,

00:01:35.960 | go back to episode 170.

00:01:37.920 | OK, so you know how we're going to handle this.

00:01:39.800 | We are not going to look at anything 2% or below

00:01:42.800 | because there are so many cash back cards out there for 2%

00:01:45.840 | that I think now because of the cards that earn more than that,

00:01:48.960 | a 2% card is actually leaving money on the table.

00:01:51.360 | So today, I'm really only going to focus on the cards

00:01:53.800 | that earn more than 2% on all of your spending.

00:01:57.240 | And fortunately, there's nine different cards that I found that do that.

00:02:00.960 | But just to do a quick recap,

00:02:02.160 | I am not sharing all of this because I don't think points are valuable.

00:02:05.320 | And I think we should all just switch everything to cash back.

00:02:08.200 | I just want to share this because if you're using a one and a half

00:02:11.800 | or even a 2x points card for all your spending or just your everyday spending

00:02:16.120 | that doesn't fit into a bonus when you could be earning 4% cash back,

00:02:20.720 | that means you're valuing your points at 2 to 2.6 cents per point.

00:02:24.360 | And while I've gotten that much value and even more sometimes for my points,

00:02:28.600 | if you look at the Points Guy's valuations or Frequent Miler's

00:02:31.920 | Reasonable Redemption values,

00:02:33.480 | you'll notice that there isn't a single airline or hotel

00:02:36.080 | point that gets valued above 2 cents on either one of those lists.

00:02:39.920 | Now, the Points Guy does say that some transferable credit card

00:02:43.280 | points are worth more than 2 cents, but it caps at 2.05 cents.

00:02:48.600 | And that's not because those points are necessarily transferable

00:02:51.680 | to places worth way more.

00:02:53.680 | It's just that they get a premium

00:02:55.480 | because they have so many different ways you can redeem them.

00:02:58.200 | So given that, I want to start talking about the best cash back cards for everything.

00:03:02.200 | And so I'm going to start with the new kid on the street,

00:03:04.720 | the U.S.

00:03:05.120 | Bank's Smartly Visa signature card, because it earns up to 4%

00:03:09.920 | cash back on every single purchase.

00:03:12.280 | So I'm looking at the website.

00:03:13.440 | It's stated as a unlimited 2% cash back card,

00:03:16.640 | because in order to get to 4%, you need to have some money stored at U.S.

00:03:20.800 | Bank, and that money doesn't have to be in a checking account.

00:03:23.600 | It could also be in a brokerage account.

00:03:25.560 | And so you could transfer over an IRA or some stocks.

00:03:28.640 | And if you transfer 5,000 or more dollars over or you hold

00:03:32.240 | $5,000 or more in your accounts, you get 2.5% on everything.

00:03:37.280 | If you go over 50,000, you get 3% back on your card.

00:03:41.120 | And if you go over $100,000, you get 4% back on everything.

00:03:45.640 | Now, that is incredible.

00:03:47.440 | I don't honestly even understand how this is possible,

00:03:50.360 | because as someone who now runs an e-commerce website,

00:03:53.760 | I'm not paying 4% to run credit card transactions.

00:03:57.440 | So how they can afford to give you 4%, I have no idea.

00:04:00.560 | How long this will last, I don't know.

00:04:02.520 | But I have multiple friends with this card, and they have gotten their 4% back.

00:04:06.680 | They have not had transactions getting declined, and they've been very happy

00:04:10.720 | with their experience with U.S. Bank.

00:04:12.400 | So a couple of the basics here, $0 annual fee, which is amazing.

00:04:16.680 | No signup bonus.

00:04:18.440 | So if you think a lot of credit cards are giving away a lot of value

00:04:20.880 | in a signup bonus, that's not happening here.

00:04:22.840 | So that's some of the way that they're able to justify giving 4% back.

00:04:26.640 | At least that's my assumption.

00:04:27.800 | A couple other things about this card.

00:04:29.200 | One, it's missing a lot of the common things

00:04:32.400 | you find from premium travel credit cards.

00:04:34.520 | And I guess at a $0 annual fee, that's because it's not a premium card.

00:04:37.880 | But when you look at the return, it is.

00:04:40.360 | So there are no waived foreign transaction fees.

00:04:43.320 | So if you use this card overseas, you're going to be paying 3%

00:04:46.120 | for all foreign transaction purchases.

00:04:48.240 | There's also no rental car coverage, travel insurance, TSA or pre-check.

00:04:52.240 | So a lot of those things are missing.

00:04:54.520 | A couple of little small nuance things that I've read when I'm doing my research here.

00:04:58.480 | There's no support for Google Voice phone numbers.

00:05:00.920 | So if you are someone who doesn't like using your regular phone number,

00:05:04.280 | that's a problem.

00:05:05.240 | On the flip side, a good friend of mine has this card.

00:05:07.480 | And he's really enjoyed the experience of using US Bank as a bank

00:05:11.560 | and the card together.

00:05:13.200 | One example was he had hit his limit on the card

00:05:16.160 | and he was able to log into the app,

00:05:18.160 | immediately pay off part of the card from his checking account

00:05:21.520 | and immediately be able to use that credit card for a purchase right away.

00:05:25.200 | Now, one of the things that I will point out is that he also had a pretty low limit.

00:05:28.760 | So this is someone that I know who regularly has high limits on other cards.

00:05:33.160 | And the highest limit he was able to get on this card was only $15,000.

00:05:37.360 | And so one of the drawbacks on this card is I have not heard a lot of stories

00:05:41.080 | of people getting really, really high limits.

00:05:43.160 | And from my experience, doing a ton of research,

00:05:46.880 | US Bank isn't too keen on you getting a $15,000 limit,

00:05:51.360 | spending $15,000, paying it down, spending another $15,000,

00:05:55.680 | paying it down, which is called credit cycling.

00:05:57.560 | They don't love that.

00:05:58.520 | Now, does that mean that if you do it one time, it's going to be a problem?

00:06:01.240 | Probably not.

00:06:02.360 | But I think if you're consistently doing that and spending $50,000, $60,000 a month

00:06:06.880 | by paying your card down frequently, obviously, I don't know

00:06:09.520 | any of the underwriting criteria here, but there's a decent chance

00:06:12.040 | you could get your card canceled, shut down, your limit lowered, etc.

00:06:15.400 | So those are some of the drawbacks.

00:06:17.920 | That said, if you have $100,000 that you can park somewhere at US Bank

00:06:22.600 | and because you can do that with brokerage assets, it doesn't cost you anything.

00:06:26.640 | It's not like you have to put it in a checking account

00:06:28.800 | that earns zero percent when you could be earning four percent.

00:06:31.440 | So in my mind, this card seems like a no brainer.

00:06:35.720 | Awesome card to be in your back pocket for that everything else category.

00:06:39.560 | With the exception of a few things I'll bring up a little bit later.

00:06:42.920 | So that is the US Bank Smartly card.

00:06:46.600 | Now, there is another US Bank card.

00:06:48.840 | And funny enough, the day the Smartly card came out,

00:06:50.960 | they stopped taking applications for it.

00:06:52.960 | However, I have seen that you can product change into it.

00:06:56.920 | And that's the US Bank Altitude Reserve card.

00:06:59.320 | Now, because you can product change into it, I'm still going to touch on it.

00:07:02.160 | But I'm only going to do that briefly because it's kind of interesting.

00:07:05.040 | It is not an everything card in that there are plenty of purchases

00:07:09.000 | that will only earn one X or one and a half X points, which is not that exciting.

00:07:13.400 | But the categories where it does earn are so broad

00:07:17.080 | that I feel like it's worth including here.

00:07:19.280 | And that's because it earns three X points on travel and all mobile wallet spending.

00:07:24.360 | So that's anywhere that you can pay with Apple Pay.

00:07:26.800 | And whether that's Apple Pay on your phone using tap to pay,

00:07:29.800 | or if you've noticed, there are a lot of websites now when you're using mobile

00:07:33.040 | or if you have a Mac using Safari, you can use Apple Pay on the web.

00:07:36.720 | And that's not just Apple Pay.

00:07:37.800 | It's Google Wallet and Samsung Pay as well.

00:07:39.880 | That makes it effectively a three X points card.

00:07:43.760 | However, there's this thing that US Bank has for these cards.

00:07:47.080 | And I'll put a link in the show notes for more detail called real time rewards.

00:07:50.760 | And any time you make a purchase in the travel category,

00:07:54.560 | they give you a text that says, hey, if you want, you can use your points

00:07:58.400 | to pay off this purchase and you can get one and a half cents per point.

00:08:02.360 | Now, if you just go to redeem your points for statement credits

00:08:05.080 | and that kind of stuff, they're worth one cent.

00:08:07.000 | So if you're earning three X points and you're able to redeem them at one

00:08:10.520 | and a half cents, then that makes it an effective four point five percent

00:08:14.800 | cashback card on all mobile wallet and travel purchases.

00:08:18.560 | Now, I don't know about you guys and how you spend your money,

00:08:21.880 | but the vast majority of things I spend my money on

00:08:25.480 | that are not in bonus categories elsewhere, I can pay with mobile wallet.

00:08:30.640 | I can pay with Apple Pay online and that kind of stuff.

00:08:33.080 | So I felt like it was worth mentioning this card.

00:08:35.560 | I know you can't sign up for it now, but if you do have another US Bank card,

00:08:39.840 | I have been told that some people are able to product change over to it.

00:08:43.080 | One of the examples was the Altitude Go card.

00:08:45.560 | So I just want to mention it.

00:08:47.520 | It's also a much more kind of premium like travel card.

00:08:50.680 | So it does have a four hundred dollar annual fee, but it comes with three

00:08:54.200 | hundred twenty five dollars of travel and dining credits

00:08:56.680 | that are so easy to use that I didn't even try to use them.

00:08:59.800 | And they just showed up on the card.

00:09:01.480 | And it has all the standard benefits that a high end travel card has.

00:09:04.840 | You get airport lounge access, travel coverage, primary rental car coverage,

00:09:08.640 | some statuses on different rental car companies, a credit for global entry,

00:09:13.200 | no foreign transaction fees and all that kind of stuff.

00:09:15.520 | So I've been really happy having the US Bank Altitude Reserve card.

00:09:19.480 | Will I product change it to a smartly card or get a smartly card for right now?

00:09:25.040 | No, because most of where I'm spending money

00:09:28.360 | that is not earning more than an effective four percent

00:09:33.000 | is where I can use Apple Pay.

00:09:34.520 | So this card is effectively a four and a half percent

00:09:37.800 | on almost everything card for me.

00:09:39.920 | Costco is a great example of a place where we spend money

00:09:42.760 | and I can pay with Apple Pay.

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00:12:17.480 | Next card is the Robinhood Gold card.

00:12:19.920 | Now, when this first got announced, it was unheard of.

00:12:23.040 | 3% on everything, that's wild.

00:12:25.160 | And that was obviously short-lived with the US Bank Smartly card.

00:12:28.120 | But here you get a 3% on everything card with no foreign transaction fees.

00:12:33.400 | It technically doesn't have an annual fee, but you can only get it

00:12:37.400 | if you have Robinhood Gold, which is $60 a year.

00:12:40.320 | And there are a lot of other benefits of Robinhood Gold that I won't talk about,

00:12:43.720 | but it's up to you to determine whether that is an annual fee or not,

00:12:47.760 | depending on whether you already have Robinhood Gold

00:12:49.840 | or the other benefits make up for it.

00:12:52.160 | So pretty great option if you, for whatever reason, don't want a US Bank card

00:12:57.560 | or if you don't have the $100,000 you need to meet their minimum,

00:13:01.600 | the US Bank card isn't a 4% card.

00:13:04.000 | And so Robinhood Gold card is interesting.

00:13:06.520 | The only hesitation I have, and one of the reasons

00:13:10.280 | I didn't get it out the gate, was that there were some mixed messages

00:13:13.480 | online about what kinds of purchases were qualifying.

00:13:16.840 | And there were people who had bought gold at Costco and gotten that declined

00:13:20.560 | or made really large tax purchases and gotten that declined.

00:13:23.560 | And having gone deep in Reddit and reading about this,

00:13:27.720 | I don't think that those claims were as widely experienced

00:13:32.720 | as they felt in the beginning.

00:13:34.600 | I think it was a few people were complaining.

00:13:36.600 | But if you do go read the terms of the card on rewards,

00:13:39.520 | they do say that purchases of precious metals, including gold,

00:13:42.520 | are not eligible for rewards.

00:13:44.760 | Same goes for purchasing reloads of balances on gift cards

00:13:48.120 | or prepaid cards or cash equivalents, business type transactions,

00:13:51.880 | including reselling.

00:13:53.200 | So if you wanted to buy a bunch of stuff at Best Buy to be able to resell,

00:13:57.200 | that was something that the terms explicitly say would not be eligible

00:14:01.240 | for rewards.

00:14:01.960 | There might be something like this in other card terms of services.

00:14:05.040 | I went and looked and didn't find it.

00:14:06.960 | But they say Robin Hood, in its sole discretion, determines

00:14:09.760 | whether a transaction constitutes an eligible purchase

00:14:12.960 | and has the right to deny points or remove points

00:14:15.440 | if they were already granted on a transaction that is ultimately deemed

00:14:18.640 | ineligible.

00:14:19.560 | So if you're using this for regular spending,

00:14:22.360 | I don't think you're going to have a problem.

00:14:23.960 | But if you're using this to try to do lots of things at scale,

00:14:27.440 | I think you might find out that their uncapped, unlimited rewards

00:14:31.360 | could come into issues, especially if you're doing a lot of business

00:14:34.960 | spending or reselling spending or things like that.

00:14:37.800 | So I think it's a good option, especially if you don't have the capital

00:14:42.720 | to be able to earn the higher rates with the Smartly card.

00:14:45.360 | Now, another card that I think is one that people probably weren't expecting

00:14:49.840 | to hear about is the Discover It card.

00:14:52.960 | And Discover is so interesting because I'm looking at their website right now

00:14:56.080 | and they just say travel credit card.

00:14:58.120 | So I'm like, which card is this?

00:14:59.600 | But when I click on it, it says it's the Discover It miles card.

00:15:02.800 | And what's interesting here is technically this card only earns

00:15:06.600 | one and a half miles for every dollar spent.

00:15:09.000 | So it's a one and a half X card.

00:15:10.680 | But for the first year, you get two X miles, which makes it a 3% back card.

00:15:16.160 | No annual fee.

00:15:18.120 | Also, no sign up bonus, but surprisingly, no foreign transaction fees.

00:15:22.440 | In fact, I didn't know this, but Discover has no foreign transaction

00:15:25.720 | fees on all credit cards.

00:15:26.960 | So that's kind of interesting.

00:15:28.040 | Another cool thing.

00:15:29.440 | This card seems to be very easy to get multiple times.

00:15:32.680 | I saw a lot of people on Reddit post that someone had it four or five times.

00:15:36.960 | And so getting it once, maybe your partner getting it the next year,

00:15:40.520 | maybe you getting it again the next year seems to be very possible.

00:15:43.600 | I do know that Discover is not known for really, really high credit limits.

00:15:49.400 | So that may be a challenge if you need to spend lots of money.

00:15:52.000 | But a no annual fee, no need to get Robin Hood gold,

00:15:55.200 | like kind of straightforward, easy way to get three X for the first year

00:15:59.760 | is the Discover it miles card and potentially to be able to do it

00:16:03.800 | over and over again.

00:16:05.200 | Added bonus, the card right now on their website

00:16:07.800 | says that it has 0% APR for the first 15 months.

00:16:11.280 | And so in addition to getting this card, you also could potentially benefit

00:16:17.920 | from not having to completely pay it off right away

00:16:20.720 | and be able to invest the money and earn a return there,

00:16:22.800 | which is an interesting thing that were the limit of the card

00:16:26.600 | to be high enough, that'd be interesting.

00:16:28.840 | If you have this card and you can earn 3% back on everything for a year,

00:16:32.120 | carrying a balance actually limits how much you can spend over the year.

00:16:35.760 | And so it might not actually be worth it from that perspective.

00:16:38.120 | But interesting card.

00:16:39.760 | I've actually never had a Discover card.

00:16:41.960 | There are a few cards that I've never had.

00:16:44.080 | I've never had a Citi thank you point card or a Discover card.

00:16:47.200 | There are things that a part of me wants solely just to have the experience.

00:16:50.960 | But then another part of me

00:16:52.160 | doesn't think it's worth a new slot, given all the other options.

00:16:55.160 | Next on the list is Bank of America.

00:16:57.160 | And I actually have a lot of recent experience

00:16:59.360 | because we've opened a handful of Bank of America cards recently.

00:17:01.960 | And Bank of America's lineup is pretty interesting.

00:17:06.000 | And it was incredibly interesting before the launch of the U.S.

00:17:09.520 | Bank Smartly card and the Robin Hood card.

00:17:11.680 | And I'll say for a couple of reasons, it's maybe still interesting.

00:17:14.600 | And if you look at any Bank of America card on face value,

00:17:17.520 | it's probably not going to be that exciting.

00:17:19.320 | And it becomes exciting with their preferred rewards program.

00:17:22.560 | And I'm pulling up right now.

00:17:24.120 | They have a gold tier, a platinum tier, a platinum honors tier and a diamond tier.

00:17:28.360 | And the reason that gets interesting is because whatever you earn

00:17:31.360 | on your credit card gets multiplied based on the tier you have.

00:17:34.920 | And so if you have $20,000 of combined balance

00:17:38.200 | across your accounts at Bank of America, which includes any accounts

00:17:42.720 | you have at Merrill, their partner brokerage firm,

00:17:45.720 | you get a increase of 25% of the points.

00:17:49.160 | If you have over $50,000, then you qualify for the platinum tier

00:17:53.160 | and you get a 50% boost.

00:17:54.840 | And then at platinum honors, you get a 75% boost.

00:17:57.880 | And then at the diamond tier, you actually get no extra benefits

00:18:01.320 | on your credit card.

00:18:02.160 | I'm not actually sure what other extra benefits you do get.

00:18:04.680 | So I don't know why that tier would be interesting to anyone.

00:18:08.720 | I've never heard of anyone in the points world talk about it.

00:18:11.040 | Now, as for which cards make this interesting,

00:18:13.560 | there are actually a quite a large number of them.

00:18:16.120 | The main ones are the unlimited cash, travel rewards, premium rewards

00:18:21.080 | and premium rewards elite.

00:18:22.600 | And the unlimited cash and the travel rewards also come in a business version.

00:18:27.040 | And so one of the reasons that I think this is interesting is

00:18:29.440 | it is really tough to get really great cash back on business cards.

00:18:34.880 | There aren't a lot of business cards offering more than 2% cash back.

00:18:38.240 | But the unlimited cash and the travel rewards business cards do,

00:18:41.640 | assuming you qualify for those higher tiers.

00:18:43.840 | And so how this works is the unlimited cash and the travel rewards

00:18:47.360 | both earn 1.5 X or 1.5%.

00:18:50.400 | And if you multiply that 1.5% times 1.75,

00:18:55.160 | because you get that boost if you're in the platinum honors camp,

00:18:57.680 | you go to 2.625%.

00:19:00.160 | Now, on the consumer side, you might say 2.625% is nothing

00:19:04.040 | compared to 4% on the US Bank Smartly card.

00:19:06.680 | And you would be right.

00:19:07.800 | And so it's actually potentially pretty interesting to consider this

00:19:11.240 | only if you need a business card.

00:19:14.120 | For some reason, you can't qualify for the US Bank card

00:19:16.960 | or if you spend so much money that the limits

00:19:20.480 | you can get on your US Bank card just aren't enough.

00:19:22.920 | And that's because I've had a lot of people I know at Bank of America

00:19:26.600 | be successful in getting incredibly large limits with Bank of America

00:19:30.600 | that I have not seen with US Bank.

00:19:32.840 | And so I mentioned the unlimited cash and the travel rewards.

00:19:36.520 | One other bonus, they do offer sign up bonuses on both those cards.

00:19:40.200 | $200 or 20,000 points.

00:19:43.000 | And they both actually offer 0% APR for 15 months.

00:19:45.600 | The only real difference between the two that I could find

00:19:48.760 | is the travel rewards has no foreign transaction fees.

00:19:51.560 | The unlimited cash has a 3% foreign transaction fee.

00:19:54.280 | And the travel rewards card seems to earn miles.

00:19:57.800 | But it seems very easy to turn those miles into statement credits worth a penny.

00:20:03.080 | So it's effectively seems like the same thing.

00:20:05.440 | So I'm not really sure the difference between those two cards practically,

00:20:08.480 | but they are separate.

00:20:09.560 | And it has not been hard for me on the business side

00:20:12.000 | to be able to get the card limit to be up north of $50,000,

00:20:17.000 | which has been super helpful on the business side.

00:20:19.600 | The one thing I will say on the personal and business side,

00:20:22.760 | obviously, you have to open up an account.

00:20:24.560 | One cool thing is that once you open that account, you can fund it

00:20:27.800 | and you qualify for their status for a full year once you have that balance.

00:20:33.440 | So if you put $100,000 in your account, you can quickly qualify.

00:20:37.480 | They have a kind of accelerated way to earn your preferred reward status,

00:20:41.800 | and it lasts for a year.

00:20:43.800 | So you don't need to have that $100,000 all the time.

00:20:46.920 | I believe it's on a rolling three month average to qualify again for a year.

00:20:51.120 | So probably months 10, 11, 12, you might need to have that $100,000 balance.

00:20:56.160 | But because you can open up a brokerage account and transfer over securities

00:21:00.160 | or IRAs, it makes it pretty easy to not worry about the fact

00:21:03.960 | that their checking account or their savings account

00:21:06.040 | isn't going to earn a lot of interest.

00:21:07.240 | I will say opening up the Merrill brokerage account for the business

00:21:12.200 | is not the easiest thing to do.

00:21:14.720 | And so for us, we were able to move some business assets

00:21:17.640 | into the checking account and qualify for a year.

00:21:19.840 | And now we have like six more months to figure out how to open up

00:21:23.160 | this business brokerage account.

00:21:25.080 | I know how to do it, but it requires a physical paper form

00:21:28.720 | that I believe needs to be faxed or brought into a branch.

00:21:31.520 | And so I just haven't gotten around to it.

00:21:33.520 | The other two cards that they have that are not the travel

00:21:36.680 | and unlimited cash are the premium rewards cards.

00:21:39.160 | And the base one, the premium rewards card

00:21:42.680 | practically has the same spending return,

00:21:46.080 | except that you also get two X points on travel.

00:21:49.760 | So instead of one and a half X on everything, you get one and a half X

00:21:52.600 | on everything and two X on travel and dining.

00:21:55.800 | So I did briefly mention the premium rewards and the premium rewards elite card.

00:22:00.000 | And they also get one and a half X on everything.

00:22:02.720 | With your platinum honor status would go to two point six to five percent.

00:22:06.480 | However, the bonus is that they get two X on travel and dining.

00:22:10.520 | And with your platinum honor status, that brings it up to three and a half X

00:22:13.640 | on travel and dining.

00:22:15.000 | And so depending on how you spend and what the blended

00:22:18.080 | average of your travel dining versus non travel dining,

00:22:21.600 | this could pretty easily find its way to be close to or even north

00:22:25.720 | of a three percent on everything card.

00:22:28.200 | And these cards both have pretty good signup bonuses, at least relative

00:22:33.240 | to the US bank card, which doesn't have one at all.

00:22:35.240 | And the premium rewards elite card has a seventy five thousand point signup bonus.

00:22:39.400 | Points are ending up being worth one cent.

00:22:41.880 | So a six hundred and a seven hundred and fifty dollar signup bonus.

00:22:44.720 | Now, interesting.

00:22:46.320 | If you assume that maybe you can average three percent on everything.

00:22:50.720 | So I was trying to compare this to the US bank card.

00:22:52.760 | So three percent on everything here, because you're getting three

00:22:55.440 | and a half on travel and dining and two point six to five on everything else.

00:22:58.560 | And you want to compare that to the US bank smartly card.

00:23:01.960 | Well, you're earning one percent there, but you're getting a seventy five

00:23:05.240 | thousand point signup bonus, which is seven hundred and fifty dollars.

00:23:08.280 | So effectively, because you're getting that seven hundred

00:23:10.960 | and fifty dollar signup bonus on the premium rewards elite card.

00:23:16.000 | It's kind of like getting a four percent return

00:23:19.280 | on the first seventy five thousand dollars you spend on the card.

00:23:22.320 | In a way, so you could view it like that, in a way, it's actually better

00:23:26.200 | because you get it all up front.

00:23:27.840 | So I would say, given the fact that this has a signup bonus,

00:23:30.920 | it could be a better card for however long it takes you to spend seventy

00:23:35.680 | five thousand dollars.

00:23:36.880 | And if you had a heavier weighting towards travel and dining spend,

00:23:40.040 | then it would actually go up and take you even further

00:23:42.640 | because you'd be only earning an incremental half a percent,

00:23:46.840 | getting four percent versus three point five.

00:23:49.480 | Then you would getting four percent versus three or two point six to five

00:23:53.800 | if you were to use one of the other Bank of America cards.

00:23:56.120 | So both those cards do have an annual fee.

00:23:59.280 | Ninety five for the regular five fifty for the elite.

00:24:02.480 | But to make up for that, they have a bunch of credits.

00:24:05.440 | And so the ninety five dollar version gives you a global entry

00:24:08.640 | credit every four years.

00:24:09.800 | It gives you a hundred dollar airline incidental credit, which we've found

00:24:13.040 | to be really easy to use without even trying.

00:24:15.440 | And with the elite card, you get four priority pass memberships.

00:24:18.960 | Now, that's not four authorized user cards with one premium rewards elite card.

00:24:23.960 | You get four individual priority pass memberships that include restaurant

00:24:27.960 | access, which is something that almost every other issuer has lost.

00:24:31.560 | And then on the cards, you get rental status, travel, coverage,

00:24:35.840 | purchase protection, that kind of stuff.

00:24:37.200 | There's also no foreign transaction fees.

00:24:39.240 | And then finally, on the elite card, yes, it has a much higher annual fee at five

00:24:43.400 | fifty, but you're getting a three hundred dollar airline credit and one hundred

00:24:46.880 | fifty dollar lifestyle credit, which total four hundred fifty.

00:24:50.400 | So effectively, you're paying one hundred dollars for that card.

00:24:53.800 | But depending on how you value four priority pass membership

00:24:56.960 | and the sign up bonus, you know, it could break even.

00:24:59.640 | That's the card we went with.

00:25:00.960 | And so far it's been great.

00:25:03.000 | There also is one perk of the premium rewards elite card

00:25:06.640 | that actually might make it very competitive with the U.S.

00:25:09.320 | Bank smartly card.

00:25:10.440 | And that is that if you want to book travel using Bank of America's

00:25:14.480 | travel portal on domestic or international airfare in any class,

00:25:19.120 | you get a 20 percent discount using your points.

00:25:22.160 | So what that means is if you had one hundred thousand points

00:25:25.240 | that would normally be redeemable for a thousand dollar statement credit

00:25:28.760 | or a thousand dollars of travel,

00:25:30.440 | you actually could go use those points and get a discount.

00:25:34.240 | So that thousand dollars of travel that you want to book

00:25:37.480 | would actually be 80,000 points or that 100,000 points

00:25:42.760 | would actually get you one thousand two hundred and fifty dollars

00:25:45.920 | worth of travel because you take 20 percent off 1250.

00:25:48.920 | So if you add 25 percent to earning two point six to five percent on everything,

00:25:54.920 | you get three point two eight percent on everything.

00:25:57.840 | Or if you add that 25 percent boost to earning three point five X

00:26:02.320 | on travel and dining, you end up with four point three seven five percent back.

00:26:06.760 | So obviously, the requirement here is you book your travel

00:26:09.920 | in the Bank of America portal.

00:26:11.320 | I have not gone through that experience yet.

00:26:13.160 | I don't know how hard or easy it is.

00:26:14.960 | I don't know how frustrating it is.

00:26:17.080 | I've talked to the past about how I prefer not to book in the travel portal.

00:26:20.400 | But if I'm able to get an extra 25 percent of value from all my points,

00:26:23.920 | I don't know, it might be worth it, especially for certain trips.

00:26:26.760 | But given how easy it is to have a simple straight four percent

00:26:30.200 | on everything card with the US Bank Smartly, is this even worth it?

00:26:32.920 | I would say probably not unless maybe you're already a Bank of America

00:26:36.920 | customer and you love it, or if you really value having a much higher limit.

00:26:41.760 | Right. If you're spending 30, 40, 50 thousand dollars a month,

00:26:44.640 | then that US Bank Smartly card can't keep up.

00:26:47.760 | And so that card might feel like a four percent card.

00:26:50.760 | But if it can only cover half your spending, then what's the backup card?

00:26:54.240 | And what is your effective rate?

00:26:56.400 | And so I would say that for someone who spends more than 15,

00:27:00.280 | 20 thousand dollars, which seems to be about the limit

00:27:02.840 | people have been getting for the Smartly card, if you're spending more than that,

00:27:05.800 | looking to Bank of America, especially the premium rewards

00:27:09.000 | elite, might be a good option.

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00:29:29.200 | The last card I'm going to mention is the Alliant Credit Union Visa Signature card.

00:29:33.400 | And I don't know anyone that has this card.

00:29:36.200 | I've never had this card.

00:29:37.400 | I've never had an account at Alliant.

00:29:38.920 | But the one interesting thing is it is a 2.5% cash back on everything card.

00:29:44.720 | It does have a few hoops that you have to jump through, but no annual fee,

00:29:49.080 | no foreign transaction fees, does have some travel protections.

00:29:52.600 | It does not have a signup bonus.

00:29:54.560 | And so if for whatever reason, none of the other options make sense for you.

00:29:59.440 | I said at the outset, I'm going to talk about cards that earn

00:30:01.960 | more than 2% on everything.

00:30:03.680 | I think this qualifies because it's 2.5%.

00:30:06.400 | The only catch is it's only on up to $10,000 per billing cycle.

00:30:10.920 | So $120,000 of spend.

00:30:13.160 | I know that's plenty for most people.

00:30:15.000 | So I thought it was worth including.

00:30:16.880 | After that, it rolls over to 1.5%.

00:30:19.400 | The requirements you need to jump through to make this work is you

00:30:23.080 | do need to enroll in e-statements.

00:30:24.800 | I imagine everyone listening here prefers getting electronic

00:30:27.520 | statements to paper ones.

00:30:28.840 | And then you do need to open up their high rate checking account,

00:30:32.600 | which is not very high rate.

00:30:33.840 | It's 0.25%.

00:30:35.240 | And you need to have one deposit a month.

00:30:38.080 | And that could be a direct deposit, an ATM deposit, a mobile check

00:30:41.560 | deposit, or even a transfer from another bank, and you need to

00:30:44.840 | maintain a balance of a thousand dollars or more now, if you compare

00:30:48.960 | that thousand dollars, what you would earn earning 4% somewhere

00:30:52.280 | else relative to a quarter of a percent here, it's going to cost

00:30:55.960 | you $37 and 50 cents a year.

00:30:58.400 | So not too high, but I would effectively assume that, okay,

00:31:01.640 | this is kind of a $37 and 50 cent annual fee card.

00:31:04.760 | If I have to open up that account.

00:31:06.040 | That said, I think all of the other options are pretty great.

00:31:09.920 | But if I go through how this looks in my head and I compare them really

00:31:13.040 | quickly, if you have a hundred thousand dollars that you can move in

00:31:16.640 | brokerage or dollars, US Bank Smartly seems like the easiest, unless you

00:31:21.000 | need a really high limit and Bank of America seems to make that a little

00:31:24.320 | bit easier, or if you need a business card, that seems to be easier.

00:31:27.760 | If a lot of your spending is mobile wallet and travel, and you can open

00:31:31.600 | up a US Bank card and you're able or eligible to product change over

00:31:35.200 | the altitude reserve could be interesting.

00:31:37.440 | If you're willing to use Robin hood, I know there are a lot of people

00:31:39.760 | that have strong feelings about it.

00:31:41.280 | 3% seems to make sense and be the best option.

00:31:44.400 | If you don't have a hundred thousand dollars to transfer over.

00:31:47.600 | The discover card seems to be a good backup to that though.

00:31:51.840 | It's only effective for a year.

00:31:53.240 | So you'd have to keep reapplying for it or opening it with your partner.

00:31:57.040 | But if all of those don't make sense, the Alliant as a backup

00:31:59.720 | earning two and a half percent is interesting, but at the point

00:32:02.560 | we're talking about two and a half percent back on everything you

00:32:05.200 | spend money on, I start to think about whether I would actually

00:32:08.600 | rather just have two X points with something like the capital

00:32:11.760 | one venture X or the venture card.

00:32:13.520 | So that's the summary here.

00:32:15.640 | Now I said that was the single best card, but I couldn't help myself

00:32:18.280 | from doing a really quick look at the card optimizer tool I built.

00:32:22.200 | And looking for the best cards that might compliment that.

00:32:25.400 | Let's say you decide, you know what, this is the year for cashback.

00:32:28.160 | Let's forget about points.

00:32:29.160 | What do I do?

00:32:30.400 | Are there any other cards that you could pair with a card earning

00:32:33.720 | three, 4% cash back that even makes sense?

00:32:36.360 | If we start first, assuming you have the smartly card.

00:32:38.760 | It's a really easy filter.

00:32:40.520 | You're looking for any card where you can earn more than 4%.

00:32:45.400 | And there aren't a lot of cards, even on categories that earn that much more.

00:32:49.680 | The most common cards that I would say can beat 4% are there's a handful of

00:32:55.720 | cards that do these rotating categories or categories that you pick like the

00:33:01.120 | bank of America customized cash, the city custom cash, us bank cash plus.

00:33:05.200 | Where you earn 5, sometimes 6% on some amount of money that when you annualize

00:33:11.640 | it ends up being around six to $10,000 a year, but if you go all the way to the

00:33:17.440 | top and say, okay, let's look at a 5% card.

00:33:20.080 | That's going to earn that on $10,000 a year relative to getting 4%.

00:33:26.160 | You're really just getting an extra 1% on $10,000, which is just $100.

00:33:30.880 | Now, if I saw a hundred dollars on the side of the road, I'm definitely going

00:33:33.480 | to pick it up, but I'm not sure that I would open up a new credit card, add it

00:33:37.120 | to my wallet, think about which card I'm using, think about when I've spent too

00:33:41.000 | much so that I don't use it anymore to earn an extra hundred dollars.

00:33:44.200 | So if you've got the smartly card and you're earning 4%, I can't really make a

00:33:48.440 | case for any other card unless you're focused on a welcome bonus or you want

00:33:53.800 | to earn points and on that welcome bonus point, we're going to get to that.

00:33:56.920 | Now, if for some reason you don't have the smartly card and you're really only

00:34:00.440 | at 3%, then there are a few more options.

00:34:03.560 | Those category cards now are going to earn you an extra two to 3%, which

00:34:07.680 | could be worth $200 a year, maybe $300 a year, still probably not worth it

00:34:13.440 | relative to what you could get from another card in your arsenal, but where

00:34:18.160 | I think it could be worth it is not the rotating cards that have a limit, but

00:34:22.040 | there are some cashback cards out there where you can earn four points or 4%

00:34:27.000 | back on a handful of categories, and when those cards come into play, I

00:34:31.200 | think if you're sitting with the Robinhood card earning 3%, it could be

00:34:34.920 | worth putting some of your spend on them.

00:34:36.400 | And the first one I'm going to mention might really surprise you because I

00:34:40.000 | don't think I've ever really considered it, but that is the Verizon Visa card.

00:34:44.280 | Now, the obvious challenge here is you can only get this card if you're a

00:34:48.840 | Verizon customer, which means you're probably already spending way more

00:34:52.320 | money on your phone bill than you would need to somewhere else, at least based

00:34:55.040 | on my experience as a former Verizon customer, but if you are eligible for

00:34:59.360 | this card as a Verizon customer, not only do you get $10 per line discount

00:35:03.920 | on your Verizon bill, but you get unlimited uncapped Forex on dining,

00:35:09.360 | grocery, and gas, so it's effectively just 4% cash back, you're earning

00:35:14.040 | these Verizon rewards, but the one caveat I'd say is those Verizon rewards

00:35:18.960 | seem to only be able to be used to offset your bill, and I couldn't find

00:35:23.160 | anyone that could explain what would happen if you earned more Verizon

00:35:27.400 | rewards in a year than your bill.

00:35:28.920 | Like what do you do with that money?

00:35:30.160 | How do you get it out?

00:35:31.240 | Can you pay a negative balance in your bill and get reimbursed?

00:35:33.960 | That was a little bit unclear, but if you're looking for a supplement card

00:35:39.560 | for the Robinhood gold card, and you spend a ton of money on dining, groceries,

00:35:43.560 | and gas, and you have Verizon, that could be a pretty rewarding experience.

00:35:48.720 | There's also a gold card out there from a very popular bank that has Forex on

00:35:52.880 | dining and groceries, and that is capped at, I believe, $25,000 and $50,000.

00:35:59.680 | And so if you're spending a lot a year in those categories, that could be worth

00:36:05.120 | it, because it's not just capped at $6,000 or $10,000, so if you have a 3X

00:36:09.520 | card, that could make sense.

00:36:10.480 | If you spend a ton of money on hotels or flights, there's the autographed journey,

00:36:15.320 | there's a platinum card, those could make sense, but otherwise, that's kind of it.

00:36:19.000 | Like if you have a 3% or 4% cash back card, I don't know if you really need

00:36:22.720 | a compliment, unless maybe you have the 3% and you spend a ridiculous amount of

00:36:27.080 | money in a couple categories that you could earn a little bit more, but we're

00:36:31.040 | talking probably, for most people, hundreds of dollars, not thousands or

00:36:34.800 | more, but to go back to all those point valuations, there are plenty of options

00:36:39.840 | where points are worth more than one cent, right?

00:36:42.960 | You can look at almost every airline point and Hyatt points, mostly not the

00:36:47.840 | other hotel points, points are worth more than one cent, so doing this analysis

00:36:51.960 | that I did, comparing one to one might not always make sense, right?

00:36:55.200 | If you're looking at a card that earns 4X points on groceries, is it fair to

00:37:01.200 | compare that equally to 4% cash back?

00:37:04.200 | Really depends on you, but probably not.

00:37:06.880 | If you have a 3% cash back card and you're comparing it to earning three

00:37:11.240 | transferable points on dining, I don't know, I'd probably take the points

00:37:16.360 | over three cents almost every day.

00:37:20.120 | So earning points might change some of this calculus, but when you go back to

00:37:24.600 | looking at your everyday spend, if you're buying something online from a random

00:37:29.320 | retailer and the best points card you have is going to earn 2X points, I really

00:37:33.760 | think for all those transactions, you should consider whether cash back is a

00:37:38.520 | better option and in that episode that I talked about earlier, number 170, I

00:37:43.840 | talked a lot about how buying points kind of changes this because it doesn't mean

00:37:48.120 | you can't benefit from the value of points, you can use that cash back to go

00:37:51.280 | buy points.

00:37:51.960 | Sure, it doesn't feel as free because you have these points and you can't really

00:37:56.080 | convert them to cash and you get to take these vacations, but practically I think

00:38:00.040 | it might be a better ROI for a lot of those purchases if you're only earning

00:38:04.360 | one, one and a half or 2X points.

00:38:06.600 | But I mentioned welcome bonuses earlier and I really need to come back there

00:38:10.240 | because I think it makes a case for throwing out everything we just talked

00:38:14.680 | about and I brought this up before even in episode 170, but I went a lot deeper

00:38:19.560 | this time and I think it's worth diving into.

00:38:22.760 | So I went to our site, allthehacks.com/cards and I looked at some of the

00:38:28.040 | top bonuses.

00:38:28.800 | So for example, the Capital One Spark Cash Plus, it's a $2,000 signup bonus on

00:38:34.240 | $30,000 of spend and you're getting 2% back on all that spend, makes it

00:38:39.440 | effectively an 8.7% cash back card on the first $30,000 until you hit that

00:38:46.120 | bonus.

00:38:46.600 | The Capital One Venture X is 75,000 points or $750 at least on $4,000 of

00:38:53.400 | spend, which makes it effectively a 20.75% cash back card, but again, only on

00:39:00.360 | that first $4,000.

00:39:01.800 | There's another offer for 60,000 points on $4,000 spend, makes it 16% back.

00:39:08.560 | There's a hotel card that earns 175,000 hotel points that I'd probably value at

00:39:13.720 | around $875 and you get those after spending 6,000.

00:39:18.680 | So that's 15.5% and I can go on and on and on.

00:39:21.840 | There are so many cards that earn meaningful percentage of cash back if you

00:39:27.360 | look at the effective cash back from the welcome bonus.

00:39:29.560 | In fact, I went through all 59 welcome offers I have listed on the page and

00:39:36.160 | which is normally sorted by best offer and there isn't a single offer where the

00:39:41.400 | earnings you'd get from spending your way to that offer is less than 7% effective

00:39:46.400 | cash back and that's valuing every single point in mile at one cent and all the

00:39:51.560 | hotel points except Hyatt at half a cent.

00:39:54.280 | And it doesn't factor in the fact that many of those cards are going to earn

00:39:58.720 | more points when you're spending your way towards that welcome bonus in different

00:40:03.320 | categories, whether they earn in travel categories, dining categories, et cetera.

00:40:07.280 | So I want to share some of the analysis that I did because it really changes my

00:40:14.240 | mind on how I think about spending.

00:40:15.840 | So from the analysis, I learned a lot of things, but first off, there are actually

00:40:19.040 | way more than 59 cards out there.

00:40:20.800 | That's how many I had listed on the site with a welcome bonus.

00:40:23.200 | So as I was going through the list, first I decided to add another 30 to the site.

00:40:27.200 | So hopefully by the time you're here, there's 89 or more cards on the site and

00:40:32.200 | there will always be some cards I don't include, but I am trying to include

00:40:35.920 | everything I find that's worth adding.

00:40:37.600 | If you look at the long tail of random cruise cards, cards, just for people that

00:40:41.920 | have poor credit and are unsecured cards and have no bonuses or even earning, I'm

00:40:46.480 | not including all of them.

00:40:47.640 | And I think you all know that some of the links on the website are partners of the

00:40:50.880 | show, and we earn an affiliate commission when you use those links.

00:40:53.760 | So first off, thank you to everyone who does use those.

00:40:56.360 | They're a big way to support the show.

00:40:57.960 | And it means a ton to me, Amy, and all of us, but there are many cards where we

00:41:01.920 | don't have a partnership and I'm still going to add them to the site.

00:41:04.600 | I'm still going to try to link to the best offer.

00:41:06.560 | And what we're going to do is I'm going to ask all the members from the All the

00:41:10.160 | Hacks membership if they have any referral links and I'll use those links.

00:41:14.000 | And if they don't, I'm just going to find the best offer I can on the website,

00:41:16.960 | probably on the issuer's website.

00:41:19.000 | However, I do want to make one big change today, which will definitely cost us

00:41:23.680 | money, but I think is worth doing in the long run.

00:41:26.120 | And that is that even for cards where we do have links that we earn an affiliate

00:41:30.360 | commission from, if there is a better link out there, whether it's a public

00:41:33.800 | offer or a referral link from our members, I'm actually going to use that

00:41:37.120 | link instead of our affiliate link.

00:41:39.360 | But it also means that you can hopefully learn to rely on our site as the best

00:41:44.040 | place to find any card offer anytime.

00:41:46.720 | Now, I know I'm supposed to make business decisions that increase

00:41:49.560 | our revenue, not decrease it.

00:41:50.800 | But my hope is that in the long run, it doesn't matter.

00:41:54.000 | And that this actually ends up being a great choice.

00:41:56.320 | And the first reason is that if we make our site the best place to find the best

00:42:01.400 | offer for any card, I think more of you will come to the site.

00:42:04.560 | I think it'll save you time.

00:42:06.320 | You won't need to go searching around.

00:42:07.920 | If that happens, maybe the links where we do have partner links and the offers we

00:42:12.520 | have are the best offers out there.

00:42:14.280 | Maybe those links will get used more.

00:42:16.160 | Second, it will help us continue to earn your trust as being a valuable resource.

00:42:21.960 | And I can't quantify how much that's worth, but I definitely know it's not zero.

00:42:26.000 | And finally, since we'll be sharing a lot of member referral links, the value of

00:42:30.240 | being an AllTheHacks member will go way up.

00:42:32.200 | In fact, most credit card referral offers are worth anywhere from $100 to $500.

00:42:37.160 | So if your link gets used even just once or twice a year, you'd earn way more from

00:42:42.160 | that credit card referral than you even pay for the membership.

00:42:45.160 | And it would be such an obvious decision for people to join.

00:42:48.040 | And in fact, we do that currently with some referral links.

00:42:51.360 | And I know one member that told me she's made back over 10x the cost

00:42:54.600 | to join just in a few months.

00:42:56.200 | So obviously if you have credit cards with referral links and you're

00:42:59.280 | interested in joining the membership and participating, you can

00:43:02.120 | go to allthehacks.com/join.

00:43:03.960 | Now, keep in mind that offers do change all the time.

00:43:07.720 | So it's not possible that the site will be perfect.

00:43:10.720 | If you ever find a better offer out there, please email us,

00:43:14.560 | podcast@allthehacks.com, but also I want you to get the most points.

00:43:18.880 | So by all means, if you ever find a better link, use that link.

00:43:23.000 | But for everything where we do have the best offers, thank you so much in

00:43:27.120 | advance for supporting us and using the links on the site at allthehacks.com/cards.

00:43:31.760 | Okay.

00:43:32.480 | Sorry for that detour.

00:43:33.680 | Back to my analysis of what I found digging into all these welcome bonuses.

00:43:37.640 | The median welcome bonus was $600 and the medium spend needed to hit that

00:43:42.240 | bonus was $4,000, which is an effective 15% cashback or 16% cashback when you

00:43:49.680 | account for the points earned from spending to get that bonus.

00:43:53.080 | And I'm just assuming that card earns at least 1% back on its spend.

00:43:57.040 | Now, the biggest bonus on the list was the Spark Cash Plus card with a $2,000

00:44:01.400 | bonus on $30,000 of spend, but accounting for the 2% back you'd get on that $30,000

00:44:07.400 | of spend, it's really a $2,600 bonus that you'd end up earning from that spend.

00:44:12.000 | 8.67%, pretty interesting.

00:44:14.880 | But 8.67% is not actually that high given that 21 of the cards on this site, which

00:44:21.480 | is over a third of them, had an average cashback rate or effective cashback rate

00:44:26.840 | on the welcome bonus spend of over 20% with the top card earning 61% back in the

00:44:34.120 | form of a $300 bonus after only $500 of spend.

00:44:37.880 | So obviously that's a small bonus in the absolute terms, but in terms of the

00:44:43.800 | percent back, 61% is pretty amazing.

00:44:46.720 | Though part of what I realized when I said that was there were a couple of cards I

00:44:50.920 | forgot.

00:44:51.400 | So the Barclays Hawaiian card, which hopefully is on the site by the time you

00:44:55.560 | look at this, is 70,000 points after your first purchase.

00:44:59.720 | So let's assume that first purchase is $1.

00:45:02.400 | That means that if you get the card, put $1 on it, you'd earn what I'll call at

00:45:06.800 | least $700 of value on $1 of spend, which is actually a 70,000% effective cashback

00:45:13.440 | rate, which is just wild.

00:45:14.520 | This episode is brought to you by Built Rewards, which is an amazing points

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00:45:22.440 | even need to check with your landlord.

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00:45:28.640 | points on rent and on your everyday spending.

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00:45:48.320 | So if you're not earning points on rent, my question is why not?

00:45:51.720 | Start earning points on rent you're already paying by going

00:45:54.800 | to chrishutchins.com/built.

00:45:57.000 | That's chrishutchins.com/built, B-I-L-T.

00:46:00.640 | Make sure to use our URL so they know we sent you chrishutchins.com/built or

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00:46:09.440 | Finally, if you were to somehow be able to sign up for all 59 cards on the site

00:46:14.160 | today, you would need to spend $307,000 to get all 59 bonuses, which would be

00:46:20.880 | worth $41,925, which is a 13.66% return on all your spend effective cashback.

00:46:29.360 | Now, obviously that doesn't include the 30 cards I mentioned I'm going to try to

00:46:32.600 | add, and if you have a partner or a player two, you can double all those numbers.

00:46:37.160 | So my guess is by the time I add all these cards and all these bonuses, and if you

00:46:41.160 | and your partner got them all, you'd probably be able to earn at least 13%

00:46:45.880 | back on a million dollars of spend.

00:46:48.080 | Could you practically get approved for that many cards in a year?

00:46:50.800 | Probably not.

00:46:51.720 | But I do know there are tons of people who open five to 10 cards a year and their

00:46:55.840 | partner does the same thing.

00:46:57.160 | And as they do it, their credit score continues to go up.

00:46:59.720 | So I think that number seems totally reasonable.

00:47:02.200 | So I just looked at 10 offers that you could get to hit $30,000 of spend.

00:47:07.640 | And if you really want to maximize things, you'd get $6,800 back, which is

00:47:13.000 | effectively a 23% cashback rate.

00:47:15.880 | And if you wanted to do that same $30,000 of spend on just five cards, you'd lower

00:47:21.200 | the bonus to $4,125, but it's still 13.75% back, at least as an effective cashback

00:47:29.160 | rate, obviously some of these points can be worth a lot more if you use them the

00:47:33.000 | right way, but even if we're just valuing them at one cent a point, that is an

00:47:37.240 | incredible amount of cashback compared to the first half of this episode, we were

00:47:41.760 | just talking about earning a max of 4%.

00:47:44.320 | So I could obviously keep going.

00:47:46.440 | This is a lot of fun for me, but I think this is a good place to stop.

00:47:49.480 | And the big takeaway here is I think that you should be thinking about earning the

00:47:54.160 | most back by first deciding how many cards you're comfortable opening up each

00:47:58.000 | year to hit bonuses.

00:47:59.920 | Then look at the best cards at the time you're opening them and the best bonuses

00:48:04.800 | on them, and if you can account for all of your spending in a year, right, if you

00:48:09.800 | only spend $30,000 a year, I would make a case that you shouldn't open up any of

00:48:14.040 | these cashback cards and you should instead open somewhere between five and

00:48:19.320 | 10 cards a year.

00:48:20.320 | And if you're with your partner, that's two to five cards per person, and that

00:48:24.040 | would get you 13 to 23% back on all of your spending and more if you value

00:48:30.240 | points more than one cent.

00:48:31.960 | And so I think that's the right strategy.

00:48:35.320 | Now, if you're someone who spends a million dollars a year, I don't think you

00:48:39.800 | can do this strategy.

00:48:40.640 | I think you're going to run out pretty quickly because by the time you open

00:48:44.120 | your 30th credit card in a year, I think you're going to get a lot of declines

00:48:47.680 | from banks and issuers.

00:48:49.120 | That said, if you're someone who's spending a much smaller amount of money,

00:48:53.080 | which is probably more like all of us, I think there are a lot of options that

00:48:57.120 | give us way more cash back, way more points than any of these other things.

00:49:01.880 | So I just push you all to think about whether welcome bonuses is actually the

00:49:07.560 | best way to manage your spend.

00:49:09.200 | And you can go look at all the cards to decide what the effective earning is and

00:49:13.720 | also how much you have to spend.

00:49:15.160 | Because if you're someone who spends a lot of money, yes, you might get the best

00:49:19.440 | absolute value from that Hawaiian card, but you only have to spend $1 on it.

00:49:24.040 | And so it doesn't last very long.

00:49:26.120 | Whereas that Spark Cash Plus card, sure the earning rate was lower at sub 10%,

00:49:32.440 | but you could use it for $30,000 of spend.

00:49:35.360 | And so obviously also that's a business card.

00:49:37.360 | So those kinds of things come into play as well.

00:49:40.520 | But I'd say if you're listening to this show, there's a decent chance that you do

00:49:44.440 | something in your life that would qualify you for a business card as a sole

00:49:48.760 | proprietor at a minimum.

00:49:49.880 | So I'll put a link in the show notes to an article about that.

00:49:52.360 | But there are a lot of ways that you might be eligible that you weren't even

00:49:55.160 | thinking of after you figure out how much you're comfortable opening up cards for

00:49:59.120 | welcome bonuses, whatever spending you have left, then look at whether it makes

00:50:03.320 | sense to go get a cash back card, like the smartly card or one of the others we

00:50:07.040 | talked about.

00:50:07.560 | I know for me, this is an area where I struggle.

00:50:10.880 | I just went through this analysis to tell you that you shouldn't be spending money

00:50:15.760 | on a 4% card, a 3% card, or really any card, because I can't think of any card

00:50:21.800 | that earns better than welcome bonus spend.

00:50:24.320 | But I can tell you that I'm not going to go open 10 cards a year.

00:50:27.560 | And I don't know why, because I know that it's not going to really affect my

00:50:31.280 | score.

00:50:31.720 | I actually understand the mechanics of it and the different approval rules.

00:50:35.160 | But for some reason, it just feels like a lot of hassle.

00:50:38.360 | And that's something I'm going to work on this year because it's not actually that

00:50:42.360 | much hassle.

00:50:42.960 | And in fact, it's January 30th as I record this.

00:50:45.680 | And I think between Amy and I, we've probably opened at least two cards so far

00:50:50.400 | in January.

00:50:51.240 | So I am trying to live by this new thing, but I get why it feels like a lot because

00:50:56.040 | I've been there.

00:50:56.600 | It feels like, "Do I really want to open another card?"

00:50:59.720 | But then I meet people who opened 30 cards last year and had zero issues.

00:51:03.800 | And because they were earning an average of 10% to 20% back throughout the year,

00:51:08.880 | they just got so much more out of their spend.

00:51:10.920 | And so I challenge you all to think about this and push yourself to look up some of

00:51:16.120 | the different rules for issuers.

00:51:17.920 | There are rules that limit how many cards you can open in a window.

00:51:21.320 | There are some issuers that are more sensitive to recent card openings.

00:51:24.480 | I believe back in an episode I did with Sebastian Fung from AskSebi, we talked

00:51:29.360 | about some of the sequencing here.

00:51:30.800 | So go back and look for that episode.

00:51:32.400 | But I hope this was helpful.

00:51:34.160 | If you want to go deeper on some of these questions or even ask me or our

00:51:37.560 | community, I invite you to join the All The Hacks membership where I try to answer

00:51:40.800 | everyone else's questions.

00:51:41.920 | And I even put out some mini episodes in the last few months that go deeper and

00:51:45.760 | into areas that I just can't share too publicly about.

00:51:48.440 | So you can find more of that on all thehacks.com/join.

00:51:51.640 | I hope those stories were awesome.

00:51:53.200 | If you have some of your own, please continue sending them in.

00:51:55.960 | I love hearing them.

00:51:57.120 | Thank you so much for listening.

00:51:58.560 | I really appreciate all the time you put in here.

00:52:01.160 | Hopefully all the rabbit holes I go down are helpful for you all to earn points,

00:52:05.840 | earn status, maximize your cash back and everything else.

00:52:09.320 | That is it for this week.

00:52:11.040 | Email is podcast@allthehacks.com.

00:52:13.160 | I will see you next week.

How to Earn $10K/Year with Cards (Up to 20% Cash Back)

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