February 18, 2010

$552 in Credit Card Rewards

The  other day we got our statement from our American Express Truearnings Costco card and it included the check for our annual cash back rebate.  Our rebate check for the year came to a total of $552 and change

The period covers Feb. 2009 through Jan. 2010.   During the period we had a total of $35,475 charges on the card.   That works out to a total return for the rewards of 1.55%.   The 1.5% is not bad, but not awesome either.

We could have done better.    FreeMoneyFinance got a 2.2% return on his cards in 2009.   FMF was using a combination of cards over the year and his best one was a 2% return from Schwab but I can't see that Schwab card offered anywhere online now.   Theres a Fidelity card with 1.5% on the first $15,000 and 2% after that.   That Fidelity card would have given us about $635 for the amount we spent.    If we used the Amex card and the Fidelity card to maximize rewards we could have gotten about $730 in rewards.   That would mean using the Amex card for 3% back on gasoline, restaurants and Costco purchases and the Fidelity card for everything else.    I'll probably want to do some more research to see if switching to another rewards card would be worth it.

Of course $35k is a lot to spend on a credit card.  Most of that is our normal spending on bills, groceries, eating out, gasoline, travel spending, gifts, etc.   Some of the spending (10-20% maybe) was for our rental properties and a tiny amount (1% or less) was for work expenses that my employer reimbursed me for.  I put virtually everything I can on the card to maximize the rewards.   The main things that aren't on thee card are our mortgage, electric, water, car insurance and garbage. 

I should state for the record that I do not carry a balance on the card and its paid off in full every month.  If you carry a balance on a credit card then you should not be charging anything more on the card for the sake of rewards.

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