You can earn thousands of dollars a year in free travel with these two powerful credit cards in your wallet. In other articles I have discussed the power of actually using the right cards for your purchases. There a lot of reason to get a credit card but in the long run getting travel assets for making purchases is a very important factor.
Travel hackers refer to the purchases you make on your travel credit cards as “spend”. If you make $1 purchase with a travel credit card that is generating travel assets like 3x points per dollar the $1 purchase is $1 of “spend”. The value of the “spend” is calculated by multiplying the spend times the number of points offered (3x etc.), times the value of each point. An example of this calculation would be $1 of spend times a 3x bonus, with a point value of 2 cents would be valued at 6 cents per dollar spent (1 x 3 x 2).
Charlene and I have a lot of travel credit cards, but we actually put most of our purchases on only two of them.
Here are the cards we actually carry in our wallets to make purchases and the spend value on our purchases that these cards generate.
Amex EveryDay Preferred Credit Card
Our base travel card is the Amex EveryDay Preferred Credit Card from American Express ($95 annual fee). If you make at least 30 transactions a billing cycle, which we do every month, you will receive a 50% points bonus at the end of the month.
Amex EveryDay Preferred Credit Card offers 3x points on the first $6,000 spent at US supermarkets annually. However, with the 30 transaction bonus that return increases to a total of 4.5x points per dollar spent ( 1.5 x 3). That’s a spend value of ~7.65 cents per dollar of spend.
Amex EveryDay Preferred Credit Card also offers 2x points on gas, which gives us a 5.1 cent on each dollar of spend on gas. Charlene and I do a lot of road trips so this is a huge advantage.
Amex EveryDay Preferred Credit Card only offers 1x on all other purchases but that still gives us 2.55 cent return on every dollar spent. This return is great for many of the product types that no other cards have bonus point deals for.
If this is the only travel card you owned you could get a minimum of 2.55 cents back on every purchase. Compare that to the cards that offer a 2% cash return on every purchase and ask yourself what’s in your wallet.
At the end of the day Charlene and I will spend about $20,000 dollars a year on our Amex EveryDay Preferred Credit Card and receive about $800 worth of travel assets for just using the card. That’s a big fat $705 ( $800 – $95 annual fee) worth for FREE TRAVEL!
Chase Sapphire Reserve
The Chase Sapphire Reserve offers 3x points on all dining and all travel purchases. The travel 3x bonus is powerful because it includes most travel costs including flights, hotels, train travel, subway tickets, Uber and even parking. This is our go-to card for any travel purchase. Charlene and I travel a lot and we eat out a lot so in a year we will generate about $18,000 dollars worth of purchases on this card. I value Ultimate Rewards points at ~1.7 cents each, so to me that’s a return that I value at ~5.1%. In an average year we will receive around $920 in travel assets with this card. The Chase Sapphire Reserve card also offers some great benefits that off set it’s $450 annual fee. The benefits that stand out are a $300 travel credit. Using the travel credit will drop the actual annual fee for this card down to $150. The Chase Sapphire Reserve card also incudes free travel insurance benefits like auto rental collision damage, waiver trip cancellation / trip interruption insurance, travel and emergency assistance services, extended warranty protection and purchase protection plus free membership to the Priority Pass for airport lounges. With all of the benefits this card offers, plus the ~$920 in travel assets we receive off of our normal yearly spend this card is a major asset in our free travel arsenal.
These are the two big cards that Charlene and I carry in our wallets for purchases. We make specific purchases on other cards but we put 90% of our purchases on these two powerful Geezer tools. In a future article we will talk about 3 other cards that are valuable to have in your wallet for making purchases.
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