I like personal finance stuff and figured this might help some other people so here’s my credit card set up and what not.

 

Credit Cards Basics:

  1. Credit cards (cc) are effectively just debit cards with bonus points

  2. You’ll get a credit limit (max amount you can charge on a cc) and you can put all your expenses on a cc which gets lumped into monthly billing cycles (statement periods)

  3. Your statement balance is due typically 1 month later

    1. ex: spend $1000 in December (1-31), pay $1000 statement balance on Jan 28

  4. Set up automatic payments so you’re never late on a payment which can hurt your credit score and always pay statements in full

    1. Any balance left on your credit card will grow at the APR rate which are typically 15-30% which is why credit card debt can get out of hand real quick, so always pay in full!

  5. Try to keep your credit card balance to under 30% of your credit limit, this will boost your credit score

  6. Typically credit cards will give you rewards (1x at least) as you spend and these points can be redeemed for cash (normally not the best value), spent on travel through booking portals, or transferred to travel partners (AMEX -> Delta or Hilton Honors)

    1. Ex: 3x points on dining -> spend $100 on dinner, get $3 in points that can be redeemed later

  7. Paid credit cards will also offer you large sign up bonuses in reward points if you spend a certain amount (4k-5k) within a certain time period (3-6months)

 

Credit Card Application Process:

  1. Submit an application for a credit card on the respective website

  2. As soon as you submit, they’ll initiate a hard inquiry/pull on your credit score which will allow the cc issuing institution to check your credit score to determine if they want to approve you for the card

    1. A hard inquiry/pull and indicates that you applied for a mortgage, loan, or credit card and will temporarily decrease your credit score (-1 to -10? In my experience)

  3. If you have a history, aka other cc’s with the institution, then you can get approved with a soft pull since they already know your credit score

    1. A soft pull won’t affect your credit score

  4. If you get approved for the card, they’ll ship it in 5-7 business days typically, but you can normally call them for the info and start putting charges on it beforehand if you want

 

Chase:

All points you accumulate with chase credit cards are called ultimate reward (UR) points which can be redeemed for cashback or travel through their ultimate rewards portal. This is super important for optimizing your spend.

Here are the cards I have:

  1. Chase Sapphire Reserve (CSR)

    1. $450 annual fee

    2. 50k points ($750 w/ 1.5x redemption) for 4k spend in 3 months

    3. Benefits: 3x dining / travel, UR points worth 1.5x, $300 travel credit, free rental auto insurance, TSA Precheck/global entry, Lyft pink for a year (10x points + 15% off rides), $120 DoorDash credits, priority pass lounge access, purchase protection

      CSR Tips:

      1.  The annual fee is effectively $150, but if you redeem $300 UR points in a year (~1 round trip flight), you make the money back or if you spend a lot of money on Lyft/DoorDash you can make it back w/ even less

      2. Travel has shut down for covid too so if you have the card already, they’re running retention offers ($150-250), I got $150 so the card was effectively free this year

      3. Priority pass allows you entry to some lounges (not as many as AMEX Platinum) in airports and the food/drinks are free

        1. Some airports don’t have lounges but priority pass pairs with restaurants to give you similar discounts ($28 off a bill) I used this 3 times in 2020

      4.  TSA Precheck / Global entry are $95 each and valid for 5 years

        1. TSA precheck allows you to go through a faster airport security

        2. Global entry allows you to skip the long international border check in lines returning to the US

  1. Chase Freedom Unlimited (CFU)

    1. $0 annual fee

    2. Benefits: 1.5x on everything, 5x on groceries

    3. I use this card on anything that isn’t classified by any of my other cards b/c 1.5x > 1x and when I transfer points to CSR and redeem through the travel portal, my 1.5x points is multiplied by 1.5x so it becomes 2.25% back when spent on travel

  2. Chase Freedom Flex (CFF)

    1. $0 annual fee

    2. Benefits: 5x on rotating categories (ex: Amazon Q3 2020, PayPal Q4 2020), 3x dining/drugstore, 5x on grocery stores for 1st year

    3. $200 sign up bonus for $500 spend in 3 months (pretty much a free $200)

  3. Chase Freedom

    1. $0 annual fee

    2. Benefits: 5x rotating categories

    3. $200 sign up bonus for $500 spend in 3 months

    4. I got this card before the Freedom Flex came out, Freedom Flex is better and Freedom is no longer offered

 

The key to this system is to remember which card has the best benefits for whatever I’m spending and then always transfer the points to my CSR so I can eventually redeem them for travel with 1.5x so at worst, I’m getting 2.25%-15% back on spend

  1. Dining – CSR or CFF is 3x -> 4.5x when redeemed for travel

  2. Travel – CSR 3x -> 4.5x

  3. Lyfts – CSR 10x -> 15x

  4. Drug Stores – CFF 3x -> 4.5x

  5. Groceries – CFF or CFU 5x -> 7.5x

  6. Rotating Categories – CFF 5x -> 7.5x

  7. All other purchases – CFU 1.5x -> 2.25x

 

I used to have this card, but if you’re a beginner, I would recommend getting the Chase Sapphire Preferred (CSP) card

  1. $95 annual fee

  2. 60k points ($750 w/ 1.25x redemption) for 4k spend in 3 months

  3. Instead of 1.5x travel redemption like CSR, you only get 1.25x

  4. 2x dining/travel/grocery stores

    1. Get one of the free chase cards for 5x on grocery stores

  5. It’ll teach you the basics of how to start earning and spending CC points and then you can upgrade to CSR later!

 

American Express:

I have the following 2 cards:

  1. American Express Corporate Green Card

    1. $150 annual fee but free because of work except we don’t get the points unless we pay for it

  2. American Express Gold

    1. 60k bonus points ($600) after 4k spend in 3 months

    2. $250 annual fee

    3. Corporate Advantage Program (CAP) – I only pay $150/year because the CAP takes $100 off my personal gold card annual fee (50 for 95/year blue cash, 75 for 150/year green, 150 for 550/year platinum)

    4. 4x dining/groceries, 3x flights, $120/year in Grubhub credits, $100 airline credit (dropping in 2022), $120 in Ubercash (Uber/Ubereats)

      1. 2021 value – $340 for $150 plus 4x points

      2. 2022 value - $240 for $150 plus 4x points

    1. Purchase protection

      1. Money back if you mess up something you bought within 90 days

 

I like the Chase Sapphire Reserve card because it’s accepted internationally, but it’s competitor it the AMEX Platinum card has phenomenal perks

  1. $550 annual fee

  2. 75k points after $5k spend in 6 months

  3. 5x flights/hotels booked through AMEX travel

  4. 10x gas/groceries

  5. $200 annual airline credit fee

  6. $200 uber credits (15/month, 35 in December)

  7. $100 in credits at Saks

  8. Priority Pass lounges + Delta Centurion Lounge

 

Chase points are on average worth more, but certain transfer partners from AMEX have better point redemption so I typically prefer to put all my spend on my chase cards. Also, chase is Visa/Mastercard which is accepted internationally, but AMEX isn’t necessarily accepted everywhere (South America + SE Asia) because they charge vendors higher transaction fees.

 

Additional resources:

Credit Karma – Check your credit score for free

Nerdwallet – Credit Card blog + guide

Thepointsguy – Credit Card Blog + guide

Youtube Recommendations – AskSebby, Graham Stephan, Waller’s Wallet, Brian Jung