February 28, 2011

$686 in Credit Card Rewards

Last year I got $552 in Credit Card Rewards for a 1.55% return.


This year we got a total of $686 in rewards between our American Express Costco Tru Earnings card and a Citibank Dividend card.    We use the Amex card for most of our purchases but use the Citi as a backup when people don't take Amex.   We also used the Citi for restaurant purchases for a few months when Citi card was offering 5% rebate at restaurants.

$516.12 this year on the Amex on purchases of about $35,155.  Thats a 1.46% return
We also had $170 from our Citibank card.   That was from about $8524 in spending for a 1.99% return.   Most of the Citibank bill was actually a large medical bill that was later reimbursed out of our HSA.

In total we had $686.12 in rewards from $43,697 spending for 1.57% return.   

We put all of our spending on credit cards that we can to maximize the cash back rewards.
We never pay interest on the cards and always pay the balance off in full each month.

2 comments:

  1. Timely post. I'm considering changing my credit card. A couple of questions:

    1) Do you believe the studies that show you spend more when using a credit card? Dave Ramsey would tell you that you need a plastectomy.

    2) Would you pay an annual fee to get more rewards? You earned $686 this year, would you pay a $59 fee to earn $1000? The delta earnings is more than the fee

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  2. Randy,

    1) I have a mixed opinion on the topic of whether or not credit cards 'make' you spend more. I think some of the studies are exaggerated and not realistic. Ramsey quotes a study that apparently doesn't even exist. So I think that talk is exaggerated for sure. But I do think that some people have a tendency to spend more with credit cards. It makes sense to be wary. If you have difficulty with controlling credit card spending then you should be safe and avoid credit cards. Personally I think I control my spending no better or worse with cards or cash.

    2) A fee might be worth it. If an airline miles card is a good value for you then it might be worth doing. I've looked at airline mile cards before but I couldn't really depend on getting a good return out of the airline miles. With cash rewards cards I know I'm getting cash with known value. With airline miles you get miles that you may be able to use for a flight you might take but you don't know what that flight would cost for sure in advance. I don't fly enough for them to be really worht my while, but if people fly a lot they could be a good deal. I'd want to find out how easily you can actually use the miles to book a flight. Some of my airlines miles are pretty hard to use for a flight that I'd want to take. If you want a red eye with 2 stops you can use miles but if you want a non stop flight during the day then you're out of luck.

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