I know a couple – Max and Vicky. He works like a fiend to earn a living and she’s always on the lookout for new streams of income. They’re new to the world of credit card bonuses, miles, and cash rewards. They asked me for simple first steps to start earning points to either redeem for cash or use for travel. They live in the US, both have good credit, no credit card debt, and neither of them has applied for more than 3 credit cards in the previous 24 months. This makes them great candidates for Chase credit card bonuses.
“It’s not the money I’m after, it’s the freedom it brings”
– some clever person
Pick up the Cash!
As you may know, I’d rather live on breadcrumbs than go shopping when I’m “in-between cards” (i.e. if I’m waiting for a new bonus-earning card to arrive). Shopping without earning rewards is like leaving cash on a sidewalk. Actually, it’s worse than that. Cash on the sidewalk can make some poor soul happy for a while, whereas unrealized rewards only make banks richer.
My favorite points are Chase Ultimate Rewards. The bank is reputable, cardholders enjoy many perks beyond the credit card sign-up bonuses and the points are easy to redeem. The added benefits differ from card to card but can include 5% cash back on purchases, cellphone insurance, purchase protection, travel insurance, rental car insurance, roadside assistance, free subscription to Instacart, no foreign transaction fees, extended warranty on purchases, ability to combine points (all cards) and transfer them to airlines and hotels (premium cards = cards that carry an annual fee).
Max and Vicky wanted a simple plan so this is what I recommended:
Step One: Vicky gets a Flex credit card and a $200 Bonus
I sent Vicky a referral link ( Earn $200 for getting a Chase card feel free to use it too) for the Chase Freedom Flex card. After getting approved (note: she will NOT add Max as an authorized user, see “Keep in Mind” below), she will use the card for her regular purchases until she reaches $500 in spending within the first 90 days of opening the account. This is all she needs to do to receive the $200 bonus and I get paid $100 for referring her. Vicky’s credit card bonus will come in the form of 20.000 Ultimate Rewards (UR) points, which she can redeem for a $200 statement credit or have the cash sent to her bank. On top of that, she will earn 1 to 5% back on every purchase made with the card. Freedom Flex comes with rotating 5% cash back categories which change every 3 months. This season it’s Amazon and streaming services.
Earnings: Vicky – $200
Step Two: Max gets a Flex card using Vicky’s referral link
Vicky clicks on “Refer a Friend” in her account and sends the generated referral link to Max, who applies for a Freedom Flex card. When he’s approved, Vicky will receive a $100 referral bonus. Max uses his new card to make $500 in purchases within the first 90 days. This is how they make another $300.
Earnings: Vicky $100 (total $300), Max $200
Step Three: Vicky gets the Unlimited card using Max’s referral link
This time, Max generates a “Refer a Friend” link and sends it to Vicky. She clicks on it and applies for another Chase Freedom card, this time the Freedom Unlimited. After approval, she spends $500 on it. She gets a $200 bonus and Max gets a $100 referral bonus. That brings us to a total of $800 in free cash so far.
Earnings: Vicky $200 (total $500), Max $100 (total $300)
Step Four: Vicky sends a link to Max, and Max gets the Unlimited card
Similarly, Vicky sends a referral link to Max, who uses it to apply for a Chase Unlimited card and gets a $200 bonus after meeting the minimum spending requirement. She gets a $100 referral bonus.
Earnings: Vicky $100 (total $600), Max $200 (total $500). Combined grand total – $1100!
Step Five: They redeem their $1100 for cash
And that’s how Max and Vicky get $1100 in credit card sign-up and referral bonuses, all starting with my referral link for a Chase Freedom card (you don’t have to use it but I thank you if you do). How fast they get there depends on their expenses. Some couples spend $2000 in a week, some over many months.
The redemption process is simple if you just want the cash. However, if you want to maximize the value of your points, you can redeem them for travel. That’s a smidgen more involved and a topic for a whole other post. If you want to jump right in, there are many great resources. Just search for travel hacking or read my article on Travel hacking with US credit card points.
In order to convert the points to cash, click on your rewards center and either redeem them for a statement credit or have it sent to your bank.
What if it’s just you alone?
If you’re single, you can still benefit from Chase Freedom bonuses. Apply for both cards, spend $500 on each in the first 90 days of ownership, and reap the $400 reward ($200 for each card).
Keep in mind
Chase has a 5/24 rule. If you were approved for 5 personal credit cards from any bank in the past 24 months (including being added as an authorized user), you’re not likely to get approved for a Chase card. Therefore, for the above scenario to work, you each need to be at 3 card approvals or less.
Pay your credit card bill in full each month, the interest rates are steep and not worth it. That is to say, only spend on a card what you could afford to pay cash for each month.
Keep meticulous records so you know what cards you have, what your minimum spending requirement and time frame is, and when your bills are due. I use Google Sheets and update the document every month when I pay my bills.
If you later want to get into travel hacking, save those points. They are more valuable if used for booking hotels and flights than they are if you just redeem them for cash, but that is fine too if cash is what you need.
For instance, the 110,000 points that Max and Vicky are about to accumulate, would pay for 18 – 31 nights at a Hyatt category 1 hotel (3500 to 6500 points a night), or they can get 2 return flights to Europe, if they transferred the points to a premium Chase card, such as Sapphire ($95 annual fee), Ink Business Preferred ($95 annual fee – scroll to the right to find it), Chase Business Premier ($195 annual fee) or Chase Sapphire Reserve Card ($550 annual fee). Although premium cards come with an annual fee, they allow the points to be transferred to travel partners, such as Hyatt Hotel or any of the Star Alliance Airlines). As an added perk, resort fees, parking fees, or taxes are usually included when you book your room with points and the flights usually come with one free check-in luggage per award ticket (a ticket booked with points).
We stayed at all tiers of Hyatt hotels, from the category 1 Hyatt Place in Salt Lake City with clean and spacious rooms with excellent beds, a couch, and complimentary breakfast, to the super-swanky category 8 Park Hyatt Sydney in Australia, standing a few steps from the Sydney Opera House. Right in the middle was the category 4 Manchester Grand Hyatt in San Diego, California, where we got upgraded to a humongous penthouse suite on the 31st floor for New Year’s Eve. We got the best bang for our buck by using Ultimate Rewards points (as Chase bank calls them) for Hyatt stays and for international flights with the Star Alliance.
I share our travel hacking stories on this website so check back often or sign up for my Mappy Monday newsletter to stay in the loop. It’ll arrive in your inbox once a month (usually on the last Monday of the month). Along with links to new stories on this website, you’ll find whatever interesting info I managed to dig up on travel hacking, finances, health, and wellness, spirituality, things I watched and read, trips Mark and I took, and whatever we’re experimenting with that month. You can check out the old issues in the Newsletter Archive.
I also wrote a post about meeting minimum spending on credit cards (and earning some cash in the process) by betting on my weight loss with HealthyWage. I played with their calculator, set the pounds I wanted to lose and the amount of time I wanted to take, I set the amount I wanted to bet each month and funded it in full with a credit card. I lost the weight, got my money back plus a nice bonus on top of that, met minimum spending on my new credit card, and earned the sign-up bonus points. Win-win.
For the exact steps I use to travel hack, read my article on Travel hacking with US credit card points.
If you’re worried about credit card applications affecting your credit score, don’t. I get plenty of cards every year and also cancel many of them (especially if they charge an annual fee) and my score is excellent. A credit score is about trustworthiness. Do you pay all your bills on time? Do you utilize only a small percentage of your credit line? Do you have a long credit history? Those are the most important factors affecting your score.
So there you have it. Earning credit card bonuses is easy as 1-2-3 (and 4). If you’re an American with good credit, please take advantage of it. The rest of the world is enviously watching. And if you are in the rest of the world, start requesting that banks give you perks for the privilege of having you as a client.
Questions? Ask in the comments, I’m here to help.
