50,000 Membership Rewards points with the American Express Premier Rewards Gold Card

The latest credit card that I’ve been approved for is the American Express Premier Rewards Gold Card.  The best current offer is an extremely easy to achieve 50,000 point sign up bonus after spending only $1,000 within the first 3 months.  This card earns 3x points on airfare and 2x points at restaurants, grocery stores, and gas stations.  There are no foreign transaction fees with this card.

My first AMEX Charge Card
The Premier Rewards Gold card is a charge card, which means that you do not carry a balance.  All charges made within a statement period need to be paid off in full.  In my last few years of credit card bonus chasing, I have never applied for an AMEX Gold Card.  The snazzy look of this card always appealed to me, but I’ve never been a fan of the American Express Membership Rewards points program.  The point system always seemed too inconvenient and confusing to me.  Even the AMEX membership rewards points page is a mess of confusing information.  You cannot share points with anyone. 

With the availability of the recent 50,000 point sign up bonus, the AMEX MR point system is worth another look. 

How much are AMEX Membership Rewards points worth?
Some bloggers value AMEX MR points at 2 cents each point (or more), but it can be tricky to figure out the best way to redeem your points. 

Do not cash out your points
Cashing out your points provides a terrible return at 1 point = 0.6 cents.  That means 10,000 MR points can only be cashed out for $60.  Compare this to Chase Ultimate Rewards points, where cashing them out provides a return of 1 point = 1 cent.  10,000 UR points can be cashed out for $100. 

Gift cards
Membership Rewards points can also be redeemed towards gift cards, up to 1 point = 1 cent.  Gift cards include restaurants, car rental companies, hotels, and retail stores.  It’s a shame Target doesn’t seem to be on that list. 

Uber rides
MR points can be redeemed towards free Uber rides at 1 point = 1 cent. 

Online shopping
Transferring MR points to Amazon or Best Buy only yields 1 point = 0.7 cents. 

Airline and Hotel transfer partners
The most valuable redemption of AMEX MR points is going to be transferring the points to any of the 16 airlines or 4 hotel transfer partners.  To me it looks like 1:1 point transfers to the Singapore Airlines Krisflyer may be the best value.  My biggest flying fantasy is to be able to travel in the extremely luxurious Singapore Airlines Suites Class.   Transferring AMEX MR points to FlyingBlue or ANA looks very valuable as well.  AMEX sometimes offers transfer bonuses that give you better return for your point conversion. 

 

AMEX airline transfer partners

AMEX hotel transfer partners

$100 airline fee credit
An interesting benefit of the Premier Rewards Gold Card is that it offers a $100 airline fee credit per calendar year.  Go here to select a qualifying airline before making your purchase.  Since we are in the middle of 2015, this means that you can get two separate $100 airline fee credits before your first year of card membership (one for 2015, and one for 2016).  That’s $200 in free airline credits. 

Many people have been able to buy airline gift cards and get reimbursed for those purchases.  I’ll probably buy a Southwest or American Airlines gift card. I ended up buying a $100 Southwest Airlines gift card and received the $100 credit shortly afterwards.  Edit: New data seems to suggest that AMEX is no longer crediting airline gift card purchases. Credit works again.

The Premier Rewards Gold card has a hefty $195 annual fee.  The $100 airline fee credit helps to offset the annual fee somewhat.  The first year of card membership does not have any fees, so you can test out whether this card is worth keeping, downgrading, or cancelling next year.  Working with the AMEX Membership Rewards points system can be a hassle, but there is definitely a lot of value in a 50,000 point sign up bonus.  You can read more discussion about this card and offer on Slickdeals and Flyertalk.  See this reddit post on different ways to use AMEX MR points.

I just hit my limit with Chase credit cards ☹

There’s been some anecdotal evidence and rumors that Chase has started to crack down on people who abuse their credit card sign up bonuses. 

The new Chase credit card application rule appears to be:

If you have opened 5 or more new credit card accounts with any credit card issuer within the past 24 months, you will NOT be approved for a Chase branded card (Freedom, Sapphire Preferred, Ink Plus or Chase Ink Cash.  Being an authorized user on someone else’s account does not count against you.

I decided to test this theory last night by trying to apply for another Chase Sapphire Preferred credit card, one of my favorite personal credit cards.  The bonus on this card can be opened after 24 months have passed since the first bonus points were awarded.

 

I was looking forward to earning another 40,000 Chase Ultimate Rewards points

Before applying, I checked Credit Karma and Credit Sesame to make sure my credit score was still good.    

 

My Credit Karma score

My Credit Sesame score

I have excellent credit history, absolutely no credit card debt.  Despite this, my application for a new Chase Sapphire Preferred card did NOT get automatic approval.  I received the following message:

Switching to cash back credit cards, for now

I’ve written before about how valuable credit card points and miles can be, often times worth 1.5 to 2.5 cents per point versus redeeming points for cash back at 1 point = 1 cent.

Points and miles have taken the two of us all over the world including the Bahamas, Jamaica, Mexico, Korea, Taiwan, Hong Kong, Japan as well as several states in America.  We’ve even had the chance to experience a first class international flight together!  By using our points and miles towards travel (flights, hotel stays, and even a cruise), we’ve been able to save a ton of money.  Travel can be expensive; points and miles can greatly reduce your expenses and allow you to use your money towards entertainment and dining instead.  Not only are points and miles more valuable than cash back, redeeming them for travel is much more exciting.  Getting cash back is boring. 

With a baby on the way and a surplus of Ultimate Rewards points, we have been switching a lot of our spending to cash back credit cards lately.  I don’t see any big travel expenses in our near future.  There won’t be any immediate need to stay at any hotels.  I never recommend hoarding points and miles, because you never know when a travel rewards program or airline will devalue the point currency.  This being said, it is good to have some points and miles saved up in case of emergencies.  If a last minute travel need comes up, it’s nice to know that we can cover almost any flight with the miles we have. 

My favorite cash back credit cards
Today I’m going to share with you the cash back cards that we have been using.  Before reading on, make sure you have absolutely NO existing credit card debt.  There’s no point in earning any cash back, miles, or points if you ever carry a credit card balance.  The interest on this borrowed money negates any value you can gain from credit card rewards.  If you have any credit card debt, stop reading further, and handle your debt.  This post is not for you.

Credit score update and new credit card approval

I regularly monitor my credit to make sure there are no red flags.  Before I apply for any new credit, the first thing I do is make sure I have a good credit score.  I like to make sure my score is at least over 740 before applying for a new credit card bonus offer. 

Your credit score

Your credit score is calculated based on these 5 factors:

35%: Payment History (how timely and consistent your payments are)

30%: Credit Utilization (debt-to-credit ratio)

15%: Length of Credit History (when did you get your first credit card?)

10%: Types of credit used (mix of credit and loans, revolving, consumer finance, mortgage)

10%: Recent searches for credit (hard inquiries and new accounts)   

There are 3 major credit reporting agencies: Experian, Transunion, and Equifax.  Each credit agency uses its own formula to calculate your score.  While you can directly buy your FICO score online at myfico.com, many other online sites offer credit scores as well.  Because different companies use different credit criteria, your credit scores will likely vary between different sources.

For most people, I do not recommend paying for your credit score.  There are plenty of good online websites that offer truly free credit scores and reports. These sites do NOT require your credit card information and the credit scores provided are really free, not some 7-day trial where they bill your credit card afterwards. 

Sites offering free credit scores that I recommend

Credit Karma gives you a simulated Transunion score and VantageScore.  You can update your credit score once a week.

CreditSesame gives you a simulated Experian score.  You can update your credit score once a month.

Quizzle gives you a simulated Equifax and VantageScore.  You can update your free credit score and report once every six months

Credit.com gives you a simulated Experian score that you can update once a month.

Some credit card companies provide free credit scores

If you are a Barclaycard credit card holder, you can get a free FICO score.  My favorite Barclaycard credit card is the ArrivalPlus MasterCard.

If you are an American Express credit card holder, you can get your free simulated Experian credit score and report once a year.  My favorite AMEX card is the Starwood Preferred Guest credit card.

Discover credit cards also offer free credit scores.  I won’t comment here because we don’t own any Discover cards. 

After checking my various credit scores, I had the confidence I needed to apply for another credit card!

The new Barclaycard Arrival Plus(TM) World Elite MasterCard®

I was pleasantly surprised today when I found out that my Barclaycard Arrival World MasterCard was being upgraded. When credit card features get refreshed, it’s usually a downgrade of the program.  In this case however, Barclaycard has refreshed and significantly upgraded their Arrival card.  The new card is now known as the Barclaycard Arrival Plus(TM) World Elite MasterCard®.

New improvements to the Arrival Plus card:

• The Arrival Plus card has a sleek and attractive new design that is cyan-colored, with chip technology.  The new card is supposedly more durable.  This is a great improvement in my opinion because I think the previous Arrival card really was quite ugly!
• There are now additional categories for travel redemption such as theme parks, museums, taxis, limos, buses, timeshares, ferries and tourist attractions.
• The previous 90 day limit for miles redemption has now been extended to 120 days.
• The card now has EMV Chip & Signature with PIN.

You can read more about the official Barclaycard announcement here.

Everything else with the Arrival card stays the same.  This includes the big sign up bonus of 40,000 bonus miles, which is easily attainable after $3,000 in purchases within the first 90 days from account opening.  With this card, you still earn 2x miles on every single purchase.  You still get 10% redeemed miles back when you redeem for travel.  Another great benefit of the Arrival Plus card is that you get free access to your online FICO® Score. 

The Arrival card is currently one of our most heavily used cards; this new upgrade makes the card even better.  My wife and I recently used our Arrival miles to pay for our free 7 day cruise vacation.  We are looking forward to receiving our new upgraded cards soon.  You can apply for your own Arrival Plus card here.

Reminder to always pay with credit

While most people know that credit cards offer fraud protection on unauthorized purchases, most people don’t know that credit cards also offer free warranty extension, purchase protection, and several other benefits.  

Warranty Extension

Your credit card will automatically protect most items you purchase up to an extra year beyond the manufacturer’s original warranty.  I’ve known this for as long as I’ve been using credit cards.  But I’ve never had to use this feature… until last month.

Slowly but surely, I’ve started to notice that my iPhone 5 (purchased over 1 year ago) was losing battery power faster than normal.  My phone used to make it through a long day of heavy usage, but now that my phone’s battery wasn’t holding a full charge as well, I found myself sometimes re-charging my phone in the middle of day.

When I went to the Apple store, the customer service rep at the Genius bar told me that my iPhone was no longer covered by the standard manufacturer’s 1 year warranty, which would have covered battery replacement for my defective phone battery.  Now, I was told that I could either have them replace my iPhone battery with a new one for $79 (plus tax), or I could get credit for my iPhone 5 and upgrade to an iPhone 5s by paying the difference.  

I’m happy with my phone and not interested in upgrading right now.

The next thing I did was call my credit card company.

Credit cards with annual fees: keep, cancel or convert?

Today I will answer the question: “What do you do when you get charged with a credit card annual fee?”

The credit card programs offering the best sign up bonuses almost always have annual fees. Most of the time, this annual fee is waived the first year of being a card member. This is great because you get to test out the card for one year to see if it's worth keeping the next year.

When your credit card gets charged the annual fee, there are 3 options: keep, convert, or cancel your credit card.

Does applying for credit cards ruin my credit score?

When it comes to finances, we have enough to worry about: saving enough for retirement, paying the rent, buying a house, buying a car, paying the bills, entertainment expenses, etc.  Wouldn't it be great if you didn't have to worry about your travel expenses?  Wouldn't it be great if your airline tickets and hotel stays could be paid for with credit card rewards points instead of cash?  

This is where travel hacking comes in.

By taking advantage of credit card sign-up bonuses, doing some manufactured spending (Amazon payments, Visa gift cards, Vanilla Reload cards, and more) and using our credit responsibly, we've been able to generate a large amount of airline miles and hotel points to use for our vacations over the last 2 years.

We open many credit cards on a regular basis, usually opening 1 or 2 cards at a time every few months. 

When people hear about how me and my wife have been traveling for free on credit card rewards points, I often get asked 2 main questions:

“Does applying for credit cards ruin my credit?” and “What do you do when you get an annual fee?”

Today I will answer the first question.

My favorite personal credit cards

I get asked this question all the time: “What is the best credit card for ME?”

Well, there isn’t an easy answer for this because there isn't a best credit card for everyone.  There are pros and cons with every credit card.  Personally, I benefit from a mixture of different credit cards used for different purchasing situations.

Some credit cards offer cash back.  Other credit cards offer airline or hotel points.  Some credit cards offer 0% intro APR for 12 or more months.  Some credit cards have low rates, but don’t offer any rewards.  Most of the really premium credit cards have annual fees (they also have some of the best sign up bonuses).  

Applying for credit cards

Whenever possible, I always pay with my credit card.  Credit cards offer an incredible amount of protection, benefits, and rewards.   

Earning credit card sign up bonuses is one of the fastest and easiest ways to earn the most cash back, miles, or points.  Sign up for a card, meet the minimum spend requirements, and earn the big bonuses.  

One of the best credit card deals out there is the Chase Sapphire Preferred

Airline miles and hotel points will let you travel all over the world for next to nothing.  BUT, you have to be wise about your credit decisions.

When deciding to apply for a new credit card, the first thing you need to check is your credit report and score. 

Free $400 from Barclays NFL credit card

Barclays bank is offering a nice sign up bonus for their NFL credit card here.

You can get $400 back in statement credits after spending $2500 within the first 90 days.

This is a free $400 rebate for one hard inquiry.  I usually am more excited about airline miles, but a free $400 is hard to resist.

You earn 2x points on NFL purchases and 1 point on other purchases.  It’s not a great card for spending other than getting the sign up bonus.  Also, this card does not have an annual fee.

You can choose various team logos for your credit card:

Habits of people with the highest credit score

MyFico has a great article on the key habits and behaviors of individuals with FICO scores greater than 785, some of the highest scores in the nation.

Here’s a great infographic the site has posted:

Free credit score from Wells Fargo (Experian)

I’m always looking for ways to check my credit report and credit score for free.  Wells Fargo is currently offering their customers a free credit score and report from Experian.  See here for more details. 

From now until midnight November 15^th, 2012, you can walk into any Wells Fargo bank to pick up a personal access code.

Keep your oldest credit card open

Your old unused credit card might be taking up space in your sock drawer, or even your wallet, but closing that account is usually not a good idea. 

People close credit cards for many reasons:

• They have trouble controlling their credit card spending
• They aren’t using the credit card often
• They don’t want to pay an annual fee
• They don't find the rewards beneficial
• They think that it gets rid of the debt (it doesn't)
• They had a bad experience with the company they took personally

You should always try to keep your oldest credit card account open if possible.  It shows credit issuers that you are able to handle credit responsibly and will only help to improve your credit score.  Having a good credit score will provide you with the best interest rates on mortgages, auto loans, and give you access to the best new credit cards.  

Bumpage: bumping off hard inquiries from your credit report

EDIT:  BUMPAGE NO LONGER WORKS FOR EQUIFAX OR TRANSUNION.

I recently "bumped" my Equifax credit score up into the 800+ range. Did you know that you can bump off hard inquiries from your credit report to raise your credit score?  It's a little known, very mysterious process called bumpage, also known as B*.  I will try to explain it in detail in this article.

To understand how bumpage works, first we need to talk about the difference between a hard inquiry and a soft inquiry.