Point Addict of Another Sort: Credit Card Incentives

I made a New Year's resolution a few years back that still stands as the only one I have ever kept.  I decided at about the time I got married that I would pay off my credit card debt, and remain free of credit card debt thereafter.  Thanks to a number of contributing factors, I have been able to do so.

This does not mean that I do not use credit cards.  Quite the opposite.  I love credit cards.  I use them absolutely every chance I get.  I'm a points addict. 

In an effort to haul in all of those balance-carrying suckers out there, credit card companies have rigged up a wide variety of incentive programs to lure customers.  I've tried a whole bunch of these deals, hearkening way back to the AAdvantage cards of old.  Now I think I've found the best.  Let me know if you can do better.

Costco True Earning Card from American Express

Here's what I love about this card:

Annual Fee=Costco Membership

You can think of this deal as a no-annual fee Amex or a free Costco membership, either/or.  The charges are one and the same.  If you are a Costco member, there is no reason not to carry and use this card.

3-2-1 cash rebate program

3% rebate on all restaurant purchases.  A recent look at my statement reveals that this rebate is applied to my charges at Starbucks (big), the pizza delivery place (bigger), even the drink stand at Sea World (huge).  We don't eat out as much as we used to with three kids, but this rebate piles up much faster than you would think.

2% rebate on travel charges.  Airline tickets, rent cars, hotels.  I don't travel all that much, but I did rack up quite a few points ona recent trip to Cabo.

1% on everything else.  I charge everything.  I route as many of my monthly bills through the card as I can.  One downside here, as there are still places where Amex is not accepted (e.g. the best sandwich shop in Austin, Delaware Subs -- alas for the 3% on that weekly purchase) so you'll have to keep some cash or a no-annual fee Visa in your wallet as well.

The refund coupons come out with the February statements, and I stand to rake several hundred this year.  The cards marketing campaign has worked well on me; I had a clear strategy how I was going to spend my rebate in Costco.  The burner in my Weber grill cracked, so time for a new one. 

But wait, my uber-handy father-in-law (aka Gandpa Sir) arrives for a holiday visit.  Suddenly parts appear and voila!  Good as new.  What now?  I'm suddenly at a loss.  Surround system for the TV?  GPS for the minvan? But here's the kicker: you can cash the coupon at Costco and walk right over to Sam's.  Or (don't tell my wife) put it in the 529.  Whatever.  There are no restrictions on this money back. And the card rebate is in addition to the rebate that you get from your Costco membership on purchases made in the warehouse.

For comparison, my previous points program was through a Visa affiliated with my brokerage firm.  It was the equivalent of 2% rebate on all purchases with a little bit better traction on airline tickets.  All merch had to be ordered retail from a catalog.  Then they devalued the points down to 1%, messed with the airline minimums, and I was out of there.  Plus there was a healthy annual fee.

Other Bennys

You can carry a balance if you want (sucker), and you still rack up a rebate as long as you pay the minimum balance.  My current interest rate is 17.24% which is well above the national averages though I've never tried to negotiate a better one.  If you carry a balance, there may be better cards for you out there.

This card has warranty extension and purchase protection programs that look good on paper, but I've never filed a claim, so I don't know how good they are in practice.

Overall, I'm really looking forward to getting my credit card bill this month.  How about you?

Clay Nichols, Health Correspondent:
Clay’s column, Dadventure, published twice monthly to Gather Essentials: Health, is a sure-fire guide to raising flawless, perfectly behaved, and always obedient children.  Yeah, right.
 
Clay is the co-author of Filmmaking for Teens: Pulling Off Your Shorts, an award-winning playwright, and the Chief Creative Officer at DadLabs.com, a fatherhood website.

You can find all of Clay’s Dadventure articles at http://gather.com/dadventure

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