July 22, 2011

Cash in on Credit Card Bonuses

I've used rewards credit cards for several years now.    I've applied for and used 4-5 cards in that time.   I started with an airline rewards card but then switched to a cash back card.   Then I found another cash back card that had a better % cash back rate.   However that card then cut its cash back so I went to my Citi cards.   Lately I've been using the Amex Costco card.

Many rewards cares are now giving pretty good sign up bonuses to entice customers to get the cards.   You can fairly easily cash in $200+ in cash or travel awards by getting a new card.   You could feasibly get a new card about once a year to cash in the bonus and then retire an old card.

Warnings : Getting more credit cards should not be done unless you are free of credit card debts and you are able to use your cards responsibly.   Unless you can keep your spending in budget and pay off your card every month you should not use credit cards at all.   If you apply for credit cards and are approved this could negatively impact your credit for at least a short period.   Generally adding a card with more credit can help your credit score but applying for credit is also a negative.  I'm not sure what the exact impact to your score will be in general but be aware that applying for one or more credit cards could hurt your credit score.

With a little searching and reference to FreeMoneyFinance's Best Cash Back Credit Cards, July 2011 I quickly came up with the following list : 

United Airlines - 30,000 bonus miles & $50, probably worth $250 or more

American Airlines - 30,000 miles & $50, probably worth $250 or more

Delta Air - 25,000 miles + $50,  probably worth $250 or more

Southwest Airlines - 20,000 points + $50, worth $216 to $383

Marriott card -30,000 points + one free night, points gets you up to 5 nights but probably 2-3

Hyatt card - 2 nights at any Hyatt

Capital One Venture card - 25,000 miles worth $250 in travel

Chase Sapphire Preferred - 50,000 points worth up to $625 in travel

Citi Thank You Premier - 50,000 points worth $500 in gift certificates

Chase Freedom - $200 cash

Several things to keep in mind with these cards : These deals are all temporary in nature and will change over time.  To get the bonus money or points you usually have to spend a certain minimum amount, keep the card for a certain period and possibly meet other requirements.  Most (if not all) of the cards have annual fees.  They often waive the fee for the first year but you'll have to pay it for subsequent years.

The Chase Sapphire and Citi Thank You cards are the best deals in general.   They net the biggest bonus.   However some of the travel awards could be worth more to you in certain situations.  You could use airline miles to pay for part or all of an expensive airline ticket and net more overall savings.

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