LifeHacker has just posted a list of the “Five Best Rewards Credit Cards” according to their readers. As an aficionado of rewards cards, I figured it might be a good time to update everyone on my present system, by which I’m attempting to make the most I possibly can by combining the benefits of several cards. (My previous post on rewards credit cards can be found here.) I highly recommend rewards cards to anyone who does not carry a balance on their credit cards each month and is capable of treating a credit card like a debit card. None of the cards I carry charge a fee, and I prefer cash-back cards to other rewards programs. I carry the following cards:
PenFed Platinum
Chase Freedom
Discover More
Citi Forward
My System
Since the Chase Freedom and Discover More cards have rotating bonus categories, my system centers on which card offers the most at a given time of year. I also make sure I get ten swipes per month on my debit card (usually small transactions) to trigger the 4% APY interest on my checking account (through a great deal offered by Crescent State Bank). This system ensures that I get no worse than 2% cash back on groceries at any time, 5% on gas, and should come out getting just under 3% cash back per purchase as an average—in addition to making 4% on my checking account balance. This year, my system works out like this:
Year-Round:
Fuel: PenFed Platinum (5%)
10 small transactions per month = 4% APY on checking
January–March
Groceries (through February) = Chase Freedom (5%)
Restaurants = Discover More (5%)
Travel (Hotels, Airlines, etc.) = Discover More (5%)
Bookstores, Entertainment, Online = Citi Forward (5x points)
Other purchases typically on Discover or Chase Freedom (1%)
March
Groceries = Discover More (5%)
April–June
Home Improvement = Discover More or Chase Freedom (5%)
Department Stores = Discover More (5%)
Clothing Stores = Discover More (5%)
Groceries = PenFed Platinum (2%)
Restaurants = Citi Forward (5x points)
Bookstores, Entertainment = Citi Forward (5x points)
July–September
Hotels, Movies, Theme Parks = Discover More (5%)
Airlines = Chase Freedom (5%)
Groceries = PenFed Platinum (2%)
October–December
Restaurants = Chase Freedom (5%)
Department Stores = Chase Freedom (5%)
Movies = Chase Freedom (5%)
Groceries = PenFed Platinum (2%)
Bookstores = Citi Forward (5x points)
(Discover has not announced their categories for this quarter yet.)
It’s a little more complicated than just having one card to swipe everywhere, but I think the extra payoff is worth it.