Taking Advantage of Credit Card Points in a Post-Pandemic World
Believe it or not, it’s been almost four years since the COVID pandemic began, and while it impacted people’s financial lives in ways both large and small, for many of us, it changed how we spend our money and therefore, how we accumulate and use those oh-so-desirable rewards dished out by our credit card companies, travel reward programs and the like.
With that in mind, we reached out to the experts at Bankrate.com for a look at the credit card rewards landscape in the post-pandemic era, and some ideas for how you might best navigate it.
Creating Opportunity from Catastrophe!
Because of how the pandemic impacted jobs and incomes, credit card companies are being more selective about whom they market to and whom they approve, and that could spell opportunities for you.
For Example: Some cards have significantly boosted the number of bonus points they award you when you open a new account, in some cases offering double the usual rewards (100,000 points instead of the typical 50,000, for example) on the condition that you spend a certain amount on the card within the first few months. In addition, those points have the same value for essential purchases as they would for travel.
The catch, of course, is that your financial house likely needs to be in relatively good shape in order for you to be approved for these higher sign-up-bonus offers in the post-COVID environment. So, if your income and other factors look good, you could find yourself swimming in reward points.
Warning: Keep in mind that applying for multiple cards in a short time span (such as one day or even one month) can ding your credit rating. Try to select one or two cards that really make sense for you, your family (and your business, if applicable), and leave it at that.
How to Take Advantage Today!
Travel expenses in most households are still down, especially in the “WFH” (work from home) age we’re now living in, where Zoom calls and online conferences have significantly dampened business travel activity over the course of the last four years.
Airlines and credit card companies have been working harder than ever to earn their customers’ loyalty. It’s easier to get (and keep) status on certain airlines (such as United and Delta, for instance) than ever before, so be sure to check out your existing card issuers and loyalty programs to see if they’re offering bonus points for new reservations – or if they’re boosting how fast you can accrue points and status.
As noted above, it might be a good time to go shopping for new cards, too, as larger-than-normal sign-up bonuses for new cardholders have become commonplace as companies fight for new members, higher account balances, and future point redemptions. Attractive offers that encourage you to switch programs or cards potentially could lead to a points windfall.
Which cards should you focus on? In general, Rossman suggests targeting cards with maximum flexibility, such as points that you can use with multiple airlines and reward programs instead of with just one. I personally use AMEX for everything I can, but also have a Chase Sapphire and Chase United card as well, for those establishments that don’t take American Express.
I also try to always book travel through AMEX travel, because it’s not only easy to use my points this way, but in many cases, you get points back for points spent on travel if you book through the credit card’s travel department.
Ultimately, it’s a good time to revisit all aspects of your credit card spending (how much you spend, the categories where you spend the most, and the deals your existing cards offer) to see whether you’re getting all the “juice” you can from your benefits and rewards. You might decide to chase after all the points and perks possible… or you might decide to forego maximum point values and opt for cards that offer the greatest amount of flexibility or simplicity.
Regardless, if you do a little homework, you can make clear-eyed decisions that reflect what you most want and need from your cards, which can make traveling easier, not to mention more frequent, as earning more points means less cost, and potentially MORE vacations!
Whether you’re looking for tips regarding credit cards awards programs or tricks to implement when using a health savings account (HSA), this is just some of the customized advice we provide to our clients.
So, if you’d like to consider a potential 2nd opinion on your retirement plan, estate plan, and investment portfolio, Click Here to take the first steps to answer a few questions and get an intro call set up on our calendar.
‘till next time!
Adam
