Before getting started I’d like to share my personal point of view about credit card points. Points are a form of currency that have real value similar to cash in many ways. Cash is used to purchase goods and services. Same goes for points. I have some friends and family who use credit cards as part of their daily life, but pay little attention to accruing points. Worse than that, they’ll redeem points for purchases on Amazon, Staples, or some other retailer. That is where you will most often get the least value. It drives me nuts–so frustrating. They are either wasting the points they already have or squandering the opportunity to earn more of this valuable form of currency. The reality is that you should put in some effort toward your points scheme–or else you’re essentially throwing away money. If you are with me, please read on. I just want to make sure we are on the same page.
I posted an article last month that explains some of the basics of credit card points. The truly great thing about earning points is the process is entirely passive. You earn points just for using your card–from your everyday morning coffee to the occasional large purchase. If you really want to accelerate the process–a little effort and some creativity can really grow your balance in no time. Let’s discuss 3 ways to boost your points balance quickly.
New Credit Card Sign-up Bonus
This way is–by far–the quickest method to earn points. Almost every credit card (that deals in points) will offer a substantial number of points as an incentive to apply. The higher end cards generally offer bigger bonuses, but come with an annual fee and a higher spending requirement to trigger that bonus. This is just one example of how to earn at least 60,000 points in just a few months.
I just used the Chase Sapphire Preferred to illustrate my point. I happen to have this card and use it often, but you should use whatever card meets your specific needs and spending patterns. A card that works well for me may not be good for you, and vice versa. It’s an individual choice. There are dozens or great cards on the market that offer a generous points bonus. Pick one that is the best fit for you.
If you are just starting out in the points game, keep in mind that you shouldn’t apply for a dozen cards at the same time hoping to amass a king’s ransom in the points world. Although there is nothing wrong with applying for several cards over the course of a year, you have to consider the impact on your credit score and your level of responsible credit card use. Also, some companies put a limit of how many cards you can be approved for over a certain period of time. With that said, strategically applying for 2 or 3 new cards per year is a good approach to accumulating points. As a matter of good housekeeping you ought to evaluate your credit card portfolio once a year to see what cards are still worth keeping and which you should cancel.
Targeted Spending
I suggest you evaluate where you do the majority of your spending. If you spend $5,000 on restaurants each year, that could be 5,000 points on one card or 15,000 on another. Many cards offer bonuses for certain spending categories, such as restaurants, travel, groceries, and fuel. Although you’ll earn points on everything that you buy, some cards will offer multipliers for those categories.
As one real life example–the British Airways Chase Visa Signature Card offers 3x Avios (BA’s version of points) for purchases made directly with British Airways, instead of the usual 1:1 ratio. A few months ago I took my family to Belgium for the holidays. That package cost me around $9,000. Using the BA Chase card, I earned 27,000 Avios. Wait, it gets better. Another perk specific to that card is 10% off the flight portion of the vacation package, so I also saved approximately $750 in addition to getting the 27,000 Avios. Pretty sweet deal!
Shopping Portals
Shopping portals are probably the most underutilized tool to accrue points. They work by directing you to a specific retailer’s site, then you shop as usual on that site. Any purchase made gets tracked behind the scenes, and the points are forwarded to your account a short time later.
There are many different shopping portals available. I alternate between two depending on which one offers me the biggest bonus for the particular retailer I plan to use. The key point is that if you shop online, use a shopping portal every time. It costs you absolutely nothing.
Rakuten
Rakuten is probably the most widely used shopping portal. They offer a cash back percentage for each purchase. The percentage varies greatly depending on the retailer, and it changes almost daily. Search for the retailer with whom you want to shop, click on the retailer, and then you’ll be directed to their website. Shop as normal. That’s it.
Key point–if you have an American Express card, you have the option to earn points instead of cash back. In my opinion, the value of the points is worth more than the cash, especially is used toward travel. The choice is yours, and either choice is a win-win.
Chase Ultimate Rewards Shopping Portal
Chase Ultimate Rewards points are available to Chase Sapphire Reserve or Chase Sapphire Preferred cardholders. The portal works the same as Rakuten. Before making a purchase I’ll look to see which shopping portal offers the biggest bonus for my intended retailer and use that one.
Bottom Line
The credit card points system is complicated. Don’t get overwhelmed. With just a little effort you can really accrue points quickly. The points you earn have real value. If you believe that–you’re already ahead of the game. Redeeming them is a whole different conversation. We’ll definitely discuss that in the near future as well.
Do you have another method you use to build your points balance?
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