Happy Monday, readers!
Work has been keeping me pretty busy lately, so my posts have been a little bit irregular. I am working on fixing that, so bear with me please. 🙂
That being said, I want to start off this Monday with an answer to a reader’s question.
Reader, and friend, Sara asks:
What’s the best credit card to sign up for to get the most free flights/ miles? [Preferably one] that doesnt rape you via apr or yearly fee?
Sara, that’s a great question. There are so many miles earning credit cards out there–almost all with their own neat sign-up bonus–that it difficult to really crown any single card as the king. Unfortunately, there really is no great miles-earning credit card out there that doesn’t have high APR. If you plan on carrying over balances, there are better cards for you out there depending on what your situation is like. The Chase Slate card, for example, is a great card to get right now if you just need some temporary help alleviating your credit card debt since it has a 0% introductory balance transfer option. That being said, I am going to focus this post on some of my favorite miles earning credit cards, with the assumption that you’re not carrying over balances on these cards. I know everyone’s situation is a little different, so you be the judge of what works for you. Just keep in mind that with high APRs, you generally cancel out any benefit you get from earning miles if you’re carrying over the balances.
Chase Ink Bold Card
The Chase Ink Bold card is a business charge card, which means you have to pay off the balance at the end of the billing period. It also happens to be one of my favorite miles-earning cards for the following reasons:
- Chase Ultimate Reward points means 1:1 transfer ratio w/ most travel partners. Since Ink Bold earns Chase Ultimate Rewards (UR) points, you get flexibility because the Chase UR points actually transfer on a 1:1 ratio with United MileagePlus®, Marriott Rewards®, Southwest Airlines Rapid Rewards®, Priority Club® Rewards, Hyatt Gold Passport®, Amtrak Guest Rewards®, British Airways Executive Club and Korean Air SKYPASS.
- Lucrative 50,000 bonus points sign-up promotion going on right now if you spend $10,000 within the first 3 months of sign-up. (If you play your cards right, that’s enough for an economy roundtrip ticket from here to Europe or Asia!) And if you think you’ll have trouble spending the $10,000, I wrote a blog post back in August about a creative way to work it out.
- 5 points per dollar for up to the first $50,000 annually you spend at office supply stores, cellular phone, landline, and tv services! So the potential bonus points/miles from this could be up to 250,000 annually! You might be thinking that you don’t normally spend much money at office supply stores, but there’s a creative way to utilize this benefit to actually earn 5x points on all your purchases everywhere. It’s a time tested method used by probably hundreds of miles enthusiasts, which I also blogged about back in August.
- 2 points per dollar for the first $50,000 annually you spend at gas stations and hotels (when booking directly with the hotel).
- No foreign transaction fees. Meaning this is one of the cards I take with me while traveling abroad.
- Annual airport lounge passes come with the Ink card as well. I haven’t really had a chance to utilize this too much, so I don’t weigh it that highly—but if you’re flying often or flying international, this definitely is a nice plus.
Overall, I definitely value my Chase Ink Bold card as one of my favorite miles-earning cards. While it is a business charge card, you can actually sign up for it as a business just under your name. (In many states, you can practice business without registering your business if your business name is the same as your full name. Freelancers and independent contractors are usually the ones who utilize this the most.) Just use your SSN in replace of the Employer Identification Number (EIN).
Here’s a link directly to the Chase application page for the Ink Bold card. There is also an identical business credit card version of this called the Ink Plus credit card. It works exactly the same, except it’s a credit card that will let you carry over balances. (Terrible APR though.)
The annual fee for the first year is waived and is $95 after. This might seem like a lot if you are new to the miles credit card game, but in all honesty, if you’re able to earn 30,000 points from your card annually–which is again enough for a one-way trip to Europe/Asia or a roundtrip within the continental U.S., then it’s definitely well worth the $95 since you would normally be paying at least $500 for those trips!
Chase Freedom Card
The Chase Freedom card is another personal favorite, especially since I have it tied to my Chase Checking account so that I earn extra points on purchases. Here’s why I value my Freedom card so much:
- Chase Ultimate Reward points. Just like the Ink Bold, the Freedom card also earns Chase Ultimate Rewards (UR) points, you get flexibility because the Chase UR points. Unfortunately though, the Chase UR for Freedom is more like a “jailed” version of the full Chase UR program that you get with the Chase Ink card or Sapphire card. In this version, you can’t directly transfer to the hotel or airline partners—but if you have an Ink card or a Sapphire card, you CAN transfer your points to the ultimate rewards for those cards and transfer from that way. I have never been quite too sure why Chase does this—other than the fact that the Freedom card has a $0 annual fee (so it’s one of their entry-level credit cards for consumers).
- Quarterly 5 points per dollar bonus category spends. This is one of the reasons why I value the Freedom card as a good miles earning card. Every quarter, they have a set of bonus categories that you can earn up to 5 points per dollar on for up to $1,500 every quarter. This quarter you earn 5 points per dollar for purchases at Best Buy, Kohl’s, Hotels, and Airlines. Hitting the $1,500 limit each quarter is usually pretty easy in my opinion. Last quarter it was on gas stations and restaurants–and with gas prices soaring, it wasn’t too hard to hit $1,500 over the course of three months for gas + restaurants. That amounts to 7,500 bonus points you can earn every quarter for up to 30,000 points annually–which is enough for a one-way economy ticket from SF to anywhere in Europe via United and Star Alliance!
- For Chase Checking Customers: Get an extra 10 bonus points per purchase! This is a nice little bonus feature by Chase, where Chase Checking customers who have a Freedom card also get an extra 10 bonus points per purchase they make, and an additional 0.1% base points on all purchases. So this means you could be earning 1.1% on all purchases and 5.1% on bonus category spends!
I think the $100 sign up bonus that is currently being offered is pretty low, so this might not be the best time to apply for a Freedom card. I would personally wait until a higher sign up promotion is offered. No annual fees for this card.
Chase Sapphire Preferred
You might be thinking that right now that I am a huge fan of Chase since all three of these cards are Chase cards so far. Well, I am actually a fan of Chase, but what new miles enthusiasts will quickly learn is that Chase Bank manages and operates the vast majority of the miles-earning credit cards out there. Chase is also a relationship-bank, which means that if you are planning on getting serious in the miles credit card game, it might help and pay off to open up a Chase checking account if you don’t already have one. It can give you a little bit more leverage with their reconsideration team down the line, and it also opens up more bonus possibilities (like the extra points for the Freedom card).
With all of that said, the Chase Sapphire Preferred card is my third favorite miles earning card out there because it scores you a base spend of 2 points per dollar on travel and restaurants. But let’s do the list for this one too:
- 2 points per dollar on all travel & dining purchases. The “travel” includes when you are paying for airfare, hotels, cruises, rental cars, train tickets, taxis, tolls, parking meters, and more. For the dining purchases, it includes those nice sit down restaurants to the cheap fast food stops. This definitely helps ensure that you’ll be able to earn base bonus points on all your daily spends.
- 7% Annual Dividend bonus. At the end of the year, you get an additional 7% bonus points on your year’s total bonus points earning. In my opinion, this is just a nice little way to help counteract the annual fee of $95. (In my opinion, this is definitely one of the cards that it’s well worth the fee.)
- Decent signup bonus of 40,000 bonus points after you spend $3,000 within the first 3 months. That’s enough for a roundtrip flight within the continental U.S. or an one-way from San Francisco to Europe via United!
- Chase Ultimate Reward points means 1:1 transfer ratio w/ most travel partners. Just like the Ink Bold and Freedom card, this card also earns Chase Ultimate Rewards (UR) points, you get flexibility because the Chase UR points actually transfer on a 1:1 ratio with United MileagePlus®, Marriott Rewards®, Southwest Airlines Rapid Rewards®, Priority Club® Rewards, Hyatt Gold Passport®, Amtrak Guest Rewards®, British Airways Executive Club and Korean Air SKYPASS.
- No foreign transaction fees. And since most of my expenses abroad are food and travel related, this definitely is at the front of my wallet during international travels.
- Purchase Protection, Extended Warranty, Price Protection, Return Protection. This one is pretty neat but it means chase will replace, repair or reimburse you for eligible items of personal property within ninety (90) days of the date of purchase. For extended warranty, it doubles the free repair period under the original manufacturer’s U.S. warranty up to 1 additional year on eligible warranties of 3 years or less. For price protection, you receive a refund of the difference between the price you paid for an eligible item on the card and a subsequent covered lower advertised price for the same item within the first 90 days of purchase. For return protection, if a retailer will not accept a return within the first 90 days of purchase, you can be reimbursed for the cost of an eligible item purchased on your card.
- Travel protection & roadside assistance.
The sign-up bonus of 40,000 is not bad right now–it’s been their standard offer for some time. I do think there will be a better offer that will come out if you feel like you want to wait. Regardless though, this is definitely one of those workhorse cards you want as a miles enthusiast in my opinion. (Although I do know folks who aren’t fans of the Sapphire Preferred card since they think it’s overhyped.)
American Express Starwood Credit Card
This is the fourth and last card I want to talk about in this post. To be honest, it’s always a little tricky picking my fourth favorite card–it changes sometimes, depending on what’s new out there in the miles credit card world. But one card that has held my #4 favorite position for some time now is the American Express Starwood card. And here’s my reasoning for this card (which is a little different from the other ones):
- It’s an American Express card. I’m a Costco fan (yay, free samples), and I am also a fan of the American Express Social Media Sync awards, which have honestly saved me over $500 over the past year alone. If you’re not familiar with the AMEX sync awards, all you have to know is that AMEX always has some great discounts (sometimes 100% discounts) for many retailers using your American Express credit card. Most of these are one-time uses, but you essentially get something for free most of the time. AMEX also has one of my favorite customer service teams out there.
- It’s a Starwood card. Starwood Hotels with their Starwood Preferred Guest (SPG) rewards program has become known in the travel industry as one of the leading customer service and hotel rewards programs. They are one of the first hotels to pioneer the cash & points redemption option, where you can stretch out your points by spending some points and paying cash at half the regular price. There are also tons of great free night redemption options.
- Earn 1 Starpoint for every dollar you spend on your AMEX card for all purchases. Receive up to 5 Starpoints for every dollar of eligible purchases charged directly hotels and resorts participating in the SPG® program – that’s 2 Starpoints per dollar spent on the Card in addition to the Starpoints you get as a Starwood Preferred Guest member.
- Lucrative sign up bonus of 25,000 Starwood points. The current offer is for 10,000 Starwood points after your first spend, and then an additional 15,000 Starpoints after you spend a total of $5,000 after the first six (6) months of having the card.
- Great airline transfer partners. There are tons of different airlines you can transfer your Starpoints to, which makes the Starpoints somewhat flexible and even more valuable! You also earn a bonus 5,000 Starpoints for every 20,000 Starpoints that you transfer.
- Faster elite status w/ SPG. Receive credit for 5 nights and 2 stays toward SPG elite status each year. That’s just 20 nights away for SPG Gold status and 45 nights away for SPG Platinum status in a calendar year!
The annual fee for this card is $65, but I think it’s definitely well worth it. If you’re interested in applying for this card, here’s the link to the application–BUT if you’re not in a rush, and you’re comfortable with sending me your email address, I would love to send you a personal referral for this card. If you sign up for the card via the referral link, I get a bonus 5,000 Starpoints when you get approved. 🙂 It’s not a necessity (you can still just go through the link I just linked!), but I would definitely appreciate it. 😉 Just leave me a comment letting me know you’re interested in one, or send me a tweet at @frugalasianman.
Those are my four favorite miles earning credit cards right now, but I also have many others that I currently still hold active. A couple of the cards I have I will be calling to cancel in the near future since my first year is ending and I can’t justify keeping them with the annual fee since their rewards aren’t lucrative enough–but that all depends on if they offer me a retention bonus or not.
For someone starting off in the miles-credit card games, I would recommend starting off with one to three credit cards, just to whet your appetite. If you want to apply for multiple credit cards, keep in mind that it takes about 24 hours for your credit report to update, so it usually makes more sense to apply for 1 or 2 cards at once within the same day than stretching them out over the course of a few days.
In terms of APR and annual fees, just keep in mind two things: 1) Miles-earning cards are generally not friendly for carrying over balances, so plan on utilizing a different strategy or having a different card for that. 2) Most annual fees are waived the first year, but you should definitely consider the value of the card when applying for it and then when deciding to keep it. If you can leverage a $1,000-value airline ticket once a year with a credit card you are only paying a $95 annual fee for, it’s probably worth it to just keep the card. Also keep in mind that constantly closing credit cards doesn’t look good on your credit score/report.
I try to keep up to date on all of the great miles earning credit card promotions, but there might still be better options out there depending on what your specific goal is. And again, these are just the miles-earning cards that I place at the top four for me. If you prefer flying certain airlines exclusively, then you might want to look for a co-branded credit card with that airline instead.
I hope that helps!
Update @ 5:35 PM on 10/29/12: Did a quick correction to the Chase Freedom’s UR point to clarify their program. (Freedom has a jailed UR version.)