Credit Cards
A community for discussing any aspect of credit cards. It is important to pay them in full and on time. Please ask questions and contribute to the knowledge surrounding credit cards
Rules
-
No-thing Nefarious. This applies to any posts where we suspect anything potentially illegal or fraudulent, and may include buying/selling tradelines.
-
No Referrals. No links; no codes. Don’t post them; don’t hint at offering them; don’t ask for them. Use rankt.com. This includes any behavior that could be deemed fishing for referrals.
-
No PM’ing Referrals. Spamming other users will get you banned.
-
No Link Shorteners.
-
Self-promotional posts must be pre-approved by a mod. Such posts are generally unwelcome. We may make an exception if it’s truly unique and helpful.
Be nice. (Don’t be a dick.)
view the rest of the comments
Alliant Credit Union has a flat 2.5% visa. To qualify you have to keep a monthly average of $1k in an ACU checking account, have at least 1 transfer on that account per month, and use e statements. Makes for a good daily driver.
That sounds almost too good to be true. Does the CU have restrictive sign up criteria? All you have to do is park a small amount in the account, make one deposit a month (does it need to be direct deposit) and you get 2.5% everywhere???
It's good, but after crunching some numbers I find it to be less of the unicorn some folks make it out to be.
The Alliant checking account earns 0.25% interest, and right now SPAXX is paying out 4.75%, so there's a delta of 4.5%.
So now there's $45 in interest a year you give up, closer to $32 after taxes.
$32/0.005 = $6,400 <- This is the breakeven point versus a 2% card with no deposit requirement (WF ActiveCash, Fidelity Visa, Citi DC, PayPal MC, etc.).
That amount might be chump change to you if you have a lot of uncategorized spend, but it's worth taking into account when choosing the best card. This was kind of my wake-up call where I realized that churning will do much more for you than optimizing spend every will. Even if you spend the $6,400 to break even, and then spend another $20,000/year, you're netting an extra $100/year. It'd take you seven years to catch up to the sign up bonus for the Chase Sapphire Preferred.
Yes but Chase Sapphire Preferred has a $95 annual fee, so after 7 years you've spent $665 on the fee which pretty much negates the $750 bonus (if redeemed on travel).