Category Archives: Credit Cards

The Best Credit Card (Right Now)

A family member recently asked for my recommendation for a good points-earning credit card she could use for her business expenses.  She spends around $1000 a month on product for her small business.  Right now she’s using a non-points-earning bank card.

This family member is in a pretty common position.  She doesn’t want to dive headfirst into the points and miles game, but she understands there’s value to be gained when making those purchases.  She doesn’t want to juggle multiple cards or frequently open new accounts.  In a case like this the decision of which card to get is actually simple.  All you have to do is find the single best card out there.

The best credit card, period.

The Chase Ink Preferred - The Best Credit Card out there!

When I started thinking about which business card to recommend, my first reaction was the Ink Business Preferred from Chase.  For various reasons (which I explain below) I thought this would be the best option for someone who only wants to get one card.

The more I thought about it, I realized the Ink Preferred is probably the best business card out there regardless of how many cards you want to juggle.  Old, weathered, card-churning veterans should want this card just as much as a newbie who wants to keep it simple.

Ink Preferred and stacks of cards

Whether you want one card or many, the Ink Preferred is the best!

After even more thought and some discussion with a couple of my card buddies, it hit me: The Chase Ink Preferred is the best card out there, period.  It not only beats all other business credit cards, but all personal ones too. It’s the best whether you’re just dabbling in the credit card game or if you’re a Value Tactics fanatic.

Let’s look at the reasons why the Chase Ink Preferred is the hottest card out there right now.

80,000 Ultimate Reward point bonus

Unless this is your first visit to ValueTactics.com, you know that the majority of a credit card’s value is in the sign-up bonus.  The Chase Ink Preferred is no exception.  After spending $5,000 in your first three months with this card, you’ll earn 80,000 bonus points.

Any card with an 80k bonus would be worth looking into, but these are Chase Ultimate Rewards we’re talking about!  To give you an idea of how much this bonus is worth, here are my last 3 Ultimate Rewards redemptions and their values:

  • For our weekend get-away to Costa Rica in February, I transferred 5,000 UR points to my Hyatt account so I had enough a third night at the Andaz Papagayo Peninsula.  The room value was $546.92/night, so those Ultimate Rewards were worth 3.65 cents each.
  • mini-polarisFor my upcoming trip to Europe, I booked a Polaris Class United flight with miles transferred from Ultimate Rewards.  The value of this redemption works out to 5.82 cents per point.
  • mini-planningI am almost ready to book flights for our fall vacation.  I will either be transferring Ultimate Rewards to Southwest for a value of about 1.7 cents per point, or using points at the Ultimate Rewards travel portal to buy airfare at a rate of 1.5 cents per point.  Let’s split the difference and say 1.6 cents per point will be the value for this Ultimate Rewards redemption.

The worst possible way to redeem Ultimate Rewards is for cash, where you’ll get 1 cent per point.  As you can clearly see, Ultimate Rewards are worth well over 2 cents per point when used wisely . . . and that’s being conservative.  My personal lifetime average for Ultimate Rewards is 2.86 cents per point.

After the $5,000 required spend to get the bonus, you’ll have a minimum of 85,000 points. At my lifetime average redemption rate of 2.86, 85k points is worth a whopping $2,341!  Even at the crappy cash-out rate, 85k points is still worth $850.  And all this for paying the initial $95 annual fee and making the minimum spend. Not bad at all!

If you’re going to apply for the Ink Preferred, I would appreciate it if you click through this link. You get the same 80k offer and I also get some bonus points for sending you there. Thanks!

Other benefits of the Chase Ink Preferred

Besides the amazing sign-up bonus, the Ink Preferred is a strong contender based on its other perks.  These perks include bonus categories for regular point earning, a bonus when redeeming points for travel, and various protections on purchases.  This card also has no foreign transaction fees, which comes in handy when traveling abroad and can save you some money when ordering from foreign websites.

Bonus Categories

The regular earning rate on the Ink Preferred is 1 point per dollar spent. From the above analysis you can see that this is probably worth more than even a 2% cash back card because the value of Ultimate Rewards is easily more than 2 cents per point. But the Ink Preferred really shines when it comes to bonus categories.  You earn 3 points per dollar spent on:

  • Travel (fairly broadly defined)
  • Shipping purchases
  • Internet, cable, and phone services
  • Internet based advertising charges

Using a valuation of 3 cents per point for Ultimate Rewards, you could look at it as an automatic 9% discount in all of these spending categories.

The Ink Preferred is the latest version of Chase's "Ink" business card line. I currently have the Ink Plus (pictured). The Preferred has the best bonus I've ever seen on an Ink card, 80,000 Ultimate Rewards points.

The Ink Preferred is the latest version of Chase’s “Ink” business card line. I currently have the Ink Plus (pictured). The Preferred has the best bonus I’ve ever seen on an Ink card, 80,000 Ultimate Rewards points.

Travel redemption bonus

If you’re satisfied with a 1.25 cent per point redemption rate, you can use your points at the Chase travel portal.  Cardholders get a 25% bonus on these redemptions, so 8,000 points is worth not $80 but $100 in travel expenses (when booked through the service.)

Purchase protections

When making purchases with the card, you will be covered with the following: trip cancellation/trip interruption insurance, roadside dispatch, auto rental collision damage waiver, cell phone protection, purchase protection, extended warranty protection, and price protection.

I have to admit, I need to look more into these kinds of benefits on all of my cards that come with them.  The restrictions, limitations, exclusions, and other terms involve quite a load of fine print on all of these.  However, I know people who have used them and saved hundreds of dollars.  You can read the fine print yourself to see if these coverages make a big difference in your overall picture of this card.  Personally, I look at these coverages as a nice little bonus but I’m not going to let them affect my decision on whether or not to get a particular card.




Should you get the Chase Ink Preferred?

Yes!!  What kind of question is that?  I just explained how it’s the best single card out there!  Ok, ok. . . let’s nuance my answer a bit.

Do you have to be a business owner?

Yes but you might be surprised to find out what qualifies you as a business owner.  Obviously Brenda from “Brenda’s Hazmat Services” is a business owner.  If you are John from “John’s Christmas Tree Farm and Flu Vaccine Emporium” you are also obviously a business owner.

But here are some examples that would qualify you as well:

  • Do you earn bicycle racing prize money and have expenses to support your racing?
  • Do you run a website that generates ad revenue?
  • Are you in a construction trade and make income with side work?
  • Do you sell giant soccer balls on amazon and ebay and have related expenses?
  • Do you spend weekends buying and selling antiques at flea markets?

These are only a few examples.  One beautiful thing about the United States is that there’s no clear line that says when you are in business or not.  Use that to your advantage when applying for business credit cards.  My usual advice is to use your full name and personal SSN if you’re not incorporated, and use your honest income figures or estimates of your income from whatever endeavor you are calling your business.

When to get the card

It’s a pretty easy decision in my opinion.  If you don’t currently have it and you are eligible to get it, get it now.  (Of course this assumes you have a plan to meet the $5k minimum spend requirement in the next 3 months).  Since it’s the best credit card available at the moment there are few, if any, reasons to prioritize any other cards above it.  By not prioritizing the Ink Preferred, you also run the risk that the 80k bonus will downgrade to 60k, which is the historically typical bonus on Chase Ink cards.

The Chase 5/24 rule applies to this card.  If you have had 5 or more new cards opened (even as an authorized user on someone else’s account) at any bank within the past 24 months, your application will be denied.

If you’re going to apply for the Ink Preferred, I would appreciate it if you click through this link. You get the same 80k offer and I also get some bonus points for sending you there. Thanks!

Conclusion

The Chase Ink Preferred is currently the best credit card out there.  The fringe benefits and category spending bonuses are valuable, but the major value is in the 80k sign-up bonus.  Ultimate rewards are so versatile that they fit into any points and miles strategy.

Since the 80k sign-up bonus is probably temporary, I would recommend almost anyone to apply for this card.  As I explained above, most people probably qualify for a business card one way or another, so that shouldn’t deter you.  (If you really can’t make any case that you need a business credit card, check out the similar personal card, the Sapphire Preferred.)




Semi-Monthly Update (June 16, 2017)

In this update:  A plethora of increased sign-up bonuses, another exciting excuse from yours truly, a travel update, and a recap of recent ValueTactics blog posts.




Credit Card News

The summer weather is heating up and so are the credit card sign-up bonuses!  Across the board, banks are rolling out some of their cards’ typical increased sign-up bonuses.  Whatever your overall card strategy is, the elevated sign-up bonuses can either simplify or complicate your decision matrix.  Either way, it’s nice to see these bonuses return; it indicates that card issuers are still hungry for your business!

  • Citi AAdvantage Platinum MastercardCiti’s AAdvantage Platinum Select MasterCard currently has an increased sign-up bonus of 60,000 American Airlines miles.  The usual bonus is 40,000.  To get the bonus miles, you must spend $3,000 in the first three months.  The $95 annual fee is waived the first year.
  • Citi’s business version of the American Airlines card listed in the previous bullet point is also at 60,000 miles for a limited time.
  • The AAdvantage Aviator Red from Barclaycard doesn’t exactly have an increased sign up bonus, but it is available with a nice 50,000 mile bonus.  This card was previously not available for new account holders; it was only available in a converted form from an old U.S. Airways card.  The $95 annual fee is not waived the first year, but the bonus is earned after your first purchase!
  • Barclaycard’s Arrival+ currently has an elevated bonus of 50,000 points after spending $3000 in the first 90 days.  The usual bonus is 40,000.  These points are redeemed for reimbursements of travel purchases made on the card.  You get 5% of redeemed points back in your account, so the current bonus on this card is worth $588.  The $89 annual fee is waived the first year.

YouTube Channel Update

todolistAnother update, another excuse!  🙂  I have acquired a key piece of equipment I need to produce high quality videos.  However I haven’t managed to acquire the time needed to put it to use.  I promise you, as soon as I’m able I will start releasing useful and entertaining videos for you to watch and share!

Recent ValueTactics Blog Posts

Barclaycard Aviator RedKeep or Cancel: Some Examples is a great post for helping you decide whether to keep a credit card when its annual fee is due.  It’s impossible to cover every variable for every situation, but this post shows some examples of how I work through the decision.

Travel News

Over the past week I’ve been struggling to book airfare for our fall trip.  It’s not that there aren’t any good options; there are plenty that would work.  It’s that I’m coordinating with a friend and we both want to get the best deal possible.  It should be pretty easy once we can both get a free hour or two together to work through it.

One thing is for sure. . . our planning is going to result in quite the spreadsheet!  Once I have it, I’ll be sure to share it on the ValueTactics Facebook page.

Now you’re updated.  Go employ some Value Tactics!

Keep or Cancel: Some Examples

Keep or cancel?  It’s the perennial question that comes up every time your credit card’s annual fee is due.  Should I pay the fee and keep the card?  Should I cancel it?  Or should I fish for a retention offer and base my decision on that offer?  All these questions can really be boiled down to one:  Will keeping this card another year be more valuable than the annual fee?




The answer to that question can be determined with some simple math, although assigning a dollar value to some card benefits gets a little subjective.  For example, the impact of cancelling a card on your credit score is hard to quantify.  Likewise, banks have different rules on how often you can get a sign-up bonus.  Keeping a card too long could hinder your future points-earning potential.  You need to consider these and many other factors when you calculate the value in each scenario.

Discussing all the different ways a card can provide value is beyond the scope of this post.  Instead, I will use a few recent examples of keep/cancel decisions that Nicoleen and I made to highlight some of the thought processes involved.

Credit cards on the chopping block.

All credit cards eventually end up on the chopping block.

Citi AAdvantage Platinum MasterCard

Recent action: CANCEL

The annual fee for Nicoleen’s Citi AAdvantage Platinum was charged on the May statement.  She’s had this card for 3 years and has never paid the annual fee.  The previous two times the fee was due she called and fished for a retention offer.  Both times she was successful in getting the fee waived or reimbursed.  We even got a few bonus miles out of the deal.

chaos pool

Citi phone reps are pretty easy to deal with, in general.  But I would still recommend finding a quiet place to make these phone calls!  This was not ideal, but it all worked out in the end.

This time she wasn’t fishing for a retention offer.  She just needed to cancel.  One main factor dominated this decision.  Before I explain that factor, here are the basics of the Citi AAdvantage Platinum MasterCard:

  • This card earns American Airline miles; 1 point per dollar on regular purchases and 2 points per dollar on American Airlines purchases.
  • The standard sign-up bonus is 30k miles with a $3k spend in the first 3 months.  The fairly frequent increased sign-up bonus is 50k miles (and rarely 60k).
  • Annual fee is $95 but is waived the first year.  Historically it’s been a very easy card to get the annual fee waived just by calling.
  • The most noteworthy fringe benefit is free checked baggage on American Airlines flights.

Citi AAdvantage Platinum Mastercard

Long before my time, this card was one of the most churnable miles cards out there.  There were several card versions and each had their own sign-up bonus.  Some people would open multiple cards in a year and have several accounts of the same card at once.  Citi was very lax with the rules on opening accounts and getting sign-up bonuses.  It was the Wild West!

By the time I got in the game, a more typical strategy for these cards was thus:  String along annual fee waivers in order to keep the account open for free.  Doing so helps your credit score by adding to both your average account length and your credit-to-debt ratio.  Some time after 24 months (Citi’s old minimum time limit between sign-up bonuses for a given card), close the account and open a new one for another 50k American Airlines miles.

But recent changes have made that strategy invalid. . .

The main factor

Late last year Citi dropped a bomb on credit card churners.  It wasn’t quite the MOAB that Chase dropped with their 5/24 rule, but it was disruptive enough to change my strategy on Citi cards.

The minimum time between sign-up bonuses is still 24 months, but it no longer applies to each specific card.  The 24 month timer is now shared among all cards of a given point type.  For example getting any Hilton sign-up bonus with Citi precludes you from getting the bonus on any other Citi Hilton card.

What’s worse is that the 24 month timer isn’t only reset by earning a sign-up bonus as it previously was.  It now also resets any time a card is cancelled or downgraded.  This is nonsensical to me because it incentivizes people to cancel their cards right after getting the sign-up bonus instead of continuing to use it for the following year(s).

The fact that it will be at least 2 years before Nicoleen can get any American Airlines co-branded card from Citi dominates all the other factors.  Any value she would get from keeping the card, even if Citi waived the annual fee, would pale in comparison to getting that timer going ASAP.  With Citi’s new bonus policy, cancelling this card was an easy decision.

NOTE: One silver lining of cancelling the Citi AAdvantage Platinum was that Nicoleen was able to transfer the credit to one of her no-fee Citi cards.  Therefore there will be no impact on her credit to debt ratio, which helps maintain a good credit score.





Barclaycard American Airlines Aviator Red

Recent action: CANCEL

Another American Airlines card and another history of having annual fees waived.  Like Nicoleen’s Citi card, I have successfully had the annual fee waived twice on my Barclaycard Aviator Red.  Usually my retention offers also came with some nice bonus miles for easy spending requirements.  Last year they waived my fee, gave me 5k miles, and bonus miles on my upcoming spending.

Barclay’s generosity with this card seems to be coming to an end, however.  According to reports on Flyertalk, retention offers are gradually drying up.  Nicoleen found this out first hand when she was offered nothing late last year.

A little about the Barclaycard Aviator Red:

  • The Aviator was originally the result of the American Airlines / U.S. Airways merger.  Barclay had a U.S. Airways card which was converted to the Aviator after the merger.
  • Until recently, the only Aviator Reds that existed were grandfathered U.S. Airways cards.  Now Barclay is taking new applications for the Aviator line of American Airlines cards.
  • Current offer is for 50k miles with no minimum spend, but the $95 annual fee is not waived the first year.
  • Notable fringe benefits are free checked bags on American, and 10% of redeemed miles refunded back every year.

Barclaycard Aviator Red

Other than the usual benefits of keeping a card open (credit score maintenance) the most compelling reason I had to keep this card was the frequent and generous bonus mile offers that came around.  –Read about some of these in this post.–  But without the annual fee waiver, the possibility of bonus offers definitely wouldn’t be enough incentive to keep this account open.

As expected, when I called I got no retention offers and decided to cancel.  I moved my credit to my Arrival card to minimize the impact on my credit score.  Now that the Aviator Red is available for new accounts, I may end up getting the card again sometime soon.  After all, I technically never got the bonus on this card, since my bonus was on the U.S. Airways card before the conversion.




More examples

Stay tuned for Keep or Cancel: Part II where I’ll show examples of cards we recently decided to keep.  I will explain what went into the decision and I’ll show just how much value we reaped from these cards to make them worth the annual fee.

My Easiest (and Quickest) Credit Card Cancellation

I recently did my monthly update to my big credit card spreadsheet and discovered I had two cards with annual fees about to hit.  After a brief analysis I decided that at least one of them, my Capital One Spark Business, had to go.  I had never cancelled a Capital One card before so I had no idea what I was in for.

The Card

The Spark Business from Capital One was my first card from that heavily advertised bank.  “What’s in your wallet?”  Not many Capital One cards.  For reasons I won’t get into right now, they have historically been relatively unpopular with those of us playing the credit card game.

spark

In a nutshell, the Spark Business earns 2% cash back on all purchases.  The sign-up bonus after spending $4.5k in 3 months was $500 cash!  That’s a pretty sweet deal, and the 2% cash back isn’t bad either.  But in my case, I wasn’t putting much regular spending on the card so the $59 annual fee wasn’t worth it for me.  The fee was waived the first year, but my first year was almost past.  It was time to cancel.

Easy (and fast!) Cancellation

I always dread cancelling cards.  This is an irrational dread since most of the time it’s pretty painless.  But once in a while you’ll get a customer service rep who wants to convince you to keep a card.  If you don’t make your intentions clear right off the bat, you’ll have to endure their run-through of the card’s benefits, or their pitch to downgrade the card or convert it to another type altogether.

In some cases, you’re fishing for a retention offer, so the personal customer service is what you want.  But other times you know you want to cancel and you just want to get it checked off your list.  In those cases, the human interaction could bog things down.

A few months ago I wrote a blog post about how easy it is to cancel Citi cards online.  At the time this was my only experience cancelling a card impersonally.  (After all, who really wants to talk to a human when you could hide behind digital anonymity!)  When I called Capital One to cancel the Spark Business I stumbled upon an even easier way to cancel cards!

I prompted the automated phone system by saying the reason for my call was: “close account.”  After I verbally affirmed a few things, the system read me a description of what closing the card would mean.  It even proactively notified me that any annual fees posted to the account in the past 30 days would be automatically refunded.  (A nice reassurance even though my fee had not yet posted.  Overall the call took less than three minutes!

Credit card cancellation in record time

As far as I know, only Capital One allows card holders to perform a credit card cancellation over the automated phone system.  I’m sure it was faster than cancelling my Citi card online and it was even more impersonal . . . if you’re into that sort of thing.

If you’ve had similarly convenient or quick experiences cancelling credit cards, please let me know by commenting on this post or on the ValueTactics Facebook page.

Thanks for reading!

Online Shopping: How to Avoid My Biggest Mistake this Holiday Season

burning-money
I leave a lot of points and miles sitting on the table.  It can happen at any time but it’s more noticeable this time of year with Christmas shopping.  I’m not talking tens of thousands of points, like you would be wasting if you screwed up a credit card bonus offer.  It’s not that huge of a mistake.  I call it my “biggest mistake” because it’s easy to avoid, yet I still manage to screw it up regularly.  I’m talking about online shopping portals.

Virtually Free Points and Miles with Online Shopping Portals

With online shopping portals you can earn potentially thousands of bonus points for about 20 seconds of work and a few keystrokes.  Many credit card points and frequent flier miles programs offer these online shopping portals, where you can earn bonus points for clicking through their link before shopping online.  You make the purchase on the retailer’s website just like normal, but you get bonus points for whichever program you used to click through to the retailer’s site.  Here’s an example:

You are about to make an electronics purchase at my favorite online computer store, newegg.com.  You remember you can earn bonus Ultimate Rewards if you shop through the portal at Chase’s website.  You log on to your Ultimate Rewards account and click “Shop through Chase:”
Online Shopping Portal

Search for newegg.com in the “earn more” area:
portals2

You’re in luck!  Newegg.com is one of the retailers in the Chase Ultimate Rewards shopping portal program.  In this case, you earn 2 additional points for every dollar you spend on newegg.com

Click through the link to newegg.com and shop like usual.  (If I go afk and I get signed out of either the shopping portal or the retailer’s site, I usually start over again.  This probably doesn’t matter but I wouldn’t want to lose out on points because something weird happened.)  I normally get my purchase researched and ready to buy, close the browser tab, and then start over with the shopping portal to actually make the purchase.

With Chase Ultimate Rewards portal (and I believe all other programs’ shopping portals) you can use whatever payment method you want.  In other words, you don’t have to use the card tied to that points program to make the purchase from the online retailer.  This comes in handy when you want spending on a particular card but would like bonus points for another program.

Do as I say, not as I do

The key to getting these bonus points is simply remembering to get them!  As this article title suggests, I am horrible at this.  Many times I don’t realize I lost out on points until weeks or months later.  It’s one of those things where you just have to get into the routine and it will become second nature.

Don’t throw away free points and miles!  Check if your credit card or frequent flyer miles program has an online shopping portal BEFORE you make those last minute Christmas shopping purchases.

Small Business Saturday 2016 . . . Another Year, Another Disappointment

This year American Express has expanded Small Business Saturday to the entire holiday shopping season.  But, for the second year in a row, they are not offering any statement credits for AMEX purchases at small businesses.  In previous years, American Express enticed shoppers to patronize small businesses by offering $10-30 in statement credits after paying with your AMEX card.  Last year was the first since 2012 that no statement credit was offered.

Scraps from the table

In an effort to salvage what was undoubtedly a less successful effort last year, American Express is offering a consolation prize.  A few days ago I received an e-mail offer for double points when using an AMEX card at small businesses through December 31st, 2016:

Small Business Saturday 2016

My Hilton HHonors card from American Express

My Hilton HHonors card from American Express

Most American Express cards are included in this offer, but you have to register each card to activate the deal.  Cards that already earn more than 1 pt per dollar on regular purchases will also double their points.  For example, my AMEX Hilton Reserve normally earns 3 points per dollar.  During the promotion it would earn 6 points per dollar at small busineses.  However, the same is not true with category bonuses (such as dining or travel) that some cards earn.  Check out the full official FAQ here.

Not a remarkable deal

For some people this promotion will be worth something.  If you already frequent retailers on the small business list, it might be worth it for you to get the double points with your AMEX card.  On the other hand, you may still get better value using another card at the same store.  This is especially true at the many restaurants that are part of the promotion, since some credit cards already earn extra points for dining establishments.  This is not even to mention other bonus offers that might be running on one of your cards, like the frequent promotions the Barclay Aviator runs.

Do the math before automatically assuming your AMEX card is the best one to use at one of these small businesses during the promotion.

The moral of the story

As I wrote about in my post about last year’s American Express Small Business Saturday, there is a lesson here.  And it’s an important one at that.  For several years people came to expect the statement credit.  Now it appears to be permanently gone.  If you count on deals, offers, bonuses, etc. to be there for you in the future, you’re misplacing your confidence!  All value tactics change and some disappear.

I liked what I wrote last year so here it is again: The key to capturing and creating value is to recognize and take advantage of good deals when they exist, and to move on and adapt when the current opportunities change or disappear.

Card Review: Chase Ink Plus

UPDATE: This card has been replaced with the Ink Business Preferred.

chase ink
The Ink Plus is Chase’s Ultimate Rewards earning business credit card. With a new standard sign-up bonus of 60,000 Ultimate Rewards points, this card is a heavy hitter in terms of value potential. And the value of the Ink Plus doesn’t all lie in the sign-up bonus either; it has generous 5x and 2x category bonuses as well, making this card one you may want to keep in your wallet for the long haul.

Basic Stats
– Issuer: Chase
– Logo: Visa Signature
– Points earned: Ultimate Rewards
– 1 pt per dollar on all purchases
– 2 pts per dollar on gas and lodging
– 5 pts per dollar on phone/internet/cable, and at office supply stores
– No foreign transaction fee
– Annual fee: $95 (NOT waived the first year)

Current sign-up bonus
60,000 bonus points after $5000 spend in 3 months

In 2014 I flew to Europe and back for 60,000 United miles, transferred from Ultimate Rewards. The bonus alone on the Ink Plus could get you the same flights!

A planted giant sequoia at Insel Mainau gardens in Konstanz, Germany

A giant sequoia at Insel Mainau gardens in Konstanz, Germany

Click here to apply for the Ink Plus business card from Chase

This card has been replaced with the Ink Business Preferred.

Can I get a business card?

This question probably scares away a lot of potential card holders of this and many other business cards with lucrative sign-up bonuses. Lucky for most of you reading this, we live in the USA, where having a “business” can mean many different things. Basically any side income that you earn that doesn’t show up on a W-2 can count as a business for the purpose of applying for a business credit card.

I have heard of many examples of businesses used to apply for these cards, some more legitimate than others. I have done ceramic tile and stone installation for over 10 years and even though it’s now an form of infrequent weekend income, it definitely qualifies. I have expenses and I earn income; that’s basically all that’s required. Others I have heard of include: bicycle racing expenses and winnings, online sales (amazon and ebay), running a website, and even inconsistent odd jobs. All of these could qualify you for a business card.

When applying, my advice is to embellish where needed, but never outright lie. If you are just starting a business or online sales effort you can use projected or expected income on your application. Be optimistic about your income figures and don’t skimp when you’re asked how much you expect to put on the card. When it comes down to it, unless you have a thriving business with employees, the bank will probably base most of its decision on your personal income and credit score (if you don’t have a federal tax ID, you will use your personal SSN for the application.)

Sign-up and category bonuses

The 60,000 Ultimate Reward bonus is incredible! Even considering you pay the first year’s annual fee up front, this card’s sign-up bonus is more valuable than its non-business counterpart, the Chase Sapphire Preferred. After the initial spend of $5k, you’ll have at least 65,000 UR points. That’s enough for:

. . . And that’s just the minimum points you’ll have after meeting the $5k spend. If you have $250 in monthly cell phone and landline/cable/internet bills on this card, you’ll earn 1250 UR points a month, or 15,000 a year. That doesn’t even consider other spending you may put on the card, including the 2x point earning on gas station purchases and lodging.

My experience with the Ink Plus

When I got the card it had an elevated sign-up bonus of 70,000 points. This deal has been seen before (and even higher, but with higher minimum spends) but the 60,000 UR bonus is one of the best around, so I wouldn’t wait for an elevated bonus. I just had lucky timing.

I have had my Ink Plus for over a year. I calculated the 5x category bonus on our cellphone and internet bills just about paid for the annual fee. So additional value I get from having the card is basically free. I also use this card on business expenses (tile supplies purchased for clients) and some fuel purchases. For me the category bonuses might make this card more of a keeper than the Sapphire Preferred. I will have to make that decision soon, as my Sapphire Preferred annual fee is due soon. (Always remember to transfer your UR points to another UR account in your household before you cancel an UR-earning card!)

Should you get this card?

Yes! The total value from getting this card is easily over $2000 and can be much higher if you redeem your transferred miles tactically. If you have absolutely no travel plans in your future, the card is still worth at least $650 in the cash-out value of your points, all for a $95 annual fee. That’s $555 profit just for getting one card and making sure you meet the minimum spend. (Don’t redeem for cash though . . . the UR points are worth much more when transferred to a partner program!)

Here are some things to consider when working the Ink Plus into your overall card strategy:

  • IMPORTANT: You have to prioritize applications for Chase cards because of the 5/24 rule.
  • Ultimate Rewards points are very versatile so having a stock of them early in your value tactics career would be helpful.
  • The 60,000 UR sign up bonus is worth more than the 50,000 point bonus on the Sapphire Preferred personal card, even when accounting for the up-front $95 fee.
  • The $5000 spending requirement may be a challenge for you to meet, especially if you have other bonus spends cooking at the same time. (REMEMBER, the $95 annual fee does not count toward your bonus spend.)

The Chase Ink Plus is an amazing card for it’s category bonuses, fringe benefits, and extremely valuable sign-up bonus. If you can make the case that you have a business (not very difficult – see above), I would highly recommend that you get this card early in your points career!

Click here to apply for the Ink Plus business card from Chase

This card has been replaced with the Ink Business Preferred.

Don’t Hoard Points


Adam Sandler’s character in “Punch Drunk Love” working on hoarding 1,000,000 miles through a loophole in a product label promotion.  He’d better spend some before the next devaluation!

In last week’s update I mentioned that I recently realized I had close to 1 million points and miles in various airline, hotel, and credit card programs.  Being a points millionaire might seem like a fun title to have, but in fact it’s dangerous.  No, I don’t mean you would need a bodyguard and a home security system; I mean your huge points and miles balances are a liability because they are only worth something when you redeem them, and redeeming them gets worth less and less as time goes by.

881

Too many points saved up? Maybe . . .


1. Devaluations

Frequent flyer and hotel rewards programs routinely devalue their points by raising the average number of points needed for a given flight or hotel stay.  This is their way of accounting for inflation.  If the dollar’s real value is decreasing by 3.1% per year (the average over several decades), it means we’re spending 3.1% more nominal dollars per year.  If every dollar we spend on a co-branded credit card earns us x points or miles, we are getting more and more redemptive power as time goes by.  At the same time, the hotels’ and the airlines’ real cost of granting you the free flights and hotel nights stays the same.  To account for this they raise the points needed for their redemptions.

Then there’s the unpleasant but unavoidable fact that websites like mine, other blogs, and forums like Flyertalk (along with the general increase in communication since these programs were started) are making these programs less lucrative for the airlines, hotel chains, and credit card companies.  As more and more people learn how to maximize the value of these programs and work every angle down to the finest detail, the companies have to push back to maintain their profits.

There are a variety of factors that cause points and miles devaluations, but it’s a fact that they will continue to occur.  No one should be surprised by this.  I agree with most of the big time bloggers on the subject, where the consensus is: It’s ok to devalue your points, but don’t try to hide it from your customers.  A recent Southwest devaluation seems to have done just that.

Points and miles gradually lose their value over time, so spending them sooner rather than later is one important tactic to maximize their value.

2. Mergers

Last year U.S. Airways was absorbed into American Airlines.  Earlier this year it was announced that Marriott will be purchasing Starwood.  Each frequent flier and preferred guest program have their unique benefits and redemption tricks.  When mergers happen, these program nuances are usually lost.  Sure, you may gain some new program benefits when you lose others, but on the whole it seems like the new entity always manages to come out on top.

For example, Starwood is famous for its awesome redemption rates at hotels ($0.02 per point, compared to Hilton’s roughly $0.003 per point rate).  The fate of everyone’s Starwood points after the Marriott merger is still unknown, but the travel community seems to be preparing for a net loss of value.

While mergers are usually known well in advance, putting all your eggs in one basket – a basket that may get dumped into another basket – is probably not the best idea.

3. Known or unknown transgressions (account closure risk)

This one is tough.  Everyone has to formulate their own ethical code of conduct when dealing with credit card bonuses and points earning strategies.  I personally play it pretty safe.  I don’t get new cards every three months like clockwork, I’m not into blatant manufactured spending, and in general I try to play by the rules.  Of course I explore the limits of the rules, but that’s the fun part!  I get a lot of value from these programs and I don’t want to risk being blacklisted.  In short, I don’t want the powers that be to like me; I want them to not even notice me.

Then there are those who play hard ball.  People who spend thousands a month on manufactured spending.  People who get authorized user cards for their dogs and cats to get the bonuses some cards offer.  People who attempt tactics such as getting the bonus spend the first day they get a card, waiting for the bonus to post, and then cancelling the card before the first month’s bill closes to avoid paying an up-front annual fee.

These people really have to worry about the future of their stored points and miles!

It’s not unheard of for accounts to be summarily closed without warning.  While many people who report such closures claim they’re completely innocent, I have a feeling most of them have done something to get on the radar of the credit card companies.  Chase seems particularly ruthless toward program abusers.  There is even a huge Flyertalk thread just for reports of Chase Ultimate Rewards accounts being wiped.

While most of these cases are probably warranted, I’m sure mistakes are sometimes made and unsuspecting decent folks have their points accounts obliterated without just cause.  The fine print associated with these programs usually gives the bank total authority over your points accounts.

Even if you’re not playing with fire, the chance exists that you could fall out of disfavor with a bank or airline and lose all your stockpiled miles.  Don’t take the chance . . . DON’T HOARD POINTS!