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Hey everyone, you might see the title of this episode and be scratching your head a little bit.
What is a credit card strategy? What does that even mean? Well, it’s a great question. The answer is yes, there is a strategy to which credit cards you use in your business and for [00:01:00] personal purchases. If managed correctly, a good credit card strategy will give you completely free money via points or miles that you can use in any number of ways.
I’m going to talk about my simple strategy that I’ve used for years that has basically paid for all of my family’s travel just using credit card points. Now, if you are interested in implementing the same strategy, you can sign up for these exact cards using the links in the show notes and I’ll get some bonus points, you get some bonus points, and everybody wins, but stay tuned and let’s talk in detail about what the strategy looks like.
[00:02:00] All right, let’s get into it.Before talking about any of this credit card strategy, I have to give a very clear disclaimer. This is only effective if you pay off your credit cards each month. Credit cards have crazy high-interest rates most of the time, and those interest rates and the money that gets charged due to those interest rates will cancel out any bonuses or points that you might earn, which totally eliminates the benefit of implementing a strategy like this.
So if you’re not someone who pays off credit cards each month, no worries. I’m sure it’s okay. This is just probably not for you. And I’m not talking about a month here or there where your expenses might slightly exceed what you’re able to pay, but I’m talking about chronically carrying a balance on your credit card month after month. If that is you, [00:03:00] again, that’s okay. And you should not try to use this strategy because it’s going to be canceled out by any of those interest rates.
Okay. So why is a credit card strategy important? Well, because managed properly, i. e. paying off your balance every month and carrying the “right credit cards” will give you tons of bonuses and free money to use on purchases or travel or statement credits, like to get money back on your purchases and many other perks. That’s the short story.
The whole system is that as you spend money on credit cards, you get points. Sometimes it’s 1 point, sometimes it’s 2 or [00:04:00] 3 or even 5 points on certain purchases. Those points add up and then you can convert those points into any number of perks. You can convert them into money- literal checks that the credit card company will write you. You can use them for travel. You can use them for statement credits. You can use them for gift cards. Any number of things.
So you can go super deep into this. I mean, there are whole blogs and businesses dedicated to credit card strategy. It can get very complicated. People have spreadsheets to track which cards they’re using. We’re not going to be doing that. I’m just going to keep it super simple. I’m going to tell you the 3 primary credit cards that I use in business and personal that each serve relatively different purposes. And like I said, these are the ones that have basically let me pay for travel for my family for the past [00:05:00] 8 to 10 years.
My strategy in particular is anchored by two things. One is the cards that I’m going to talk about offer very generous sign-on bonuses. What that means is when you sign up for the card and you spend a certain amount of money, that’s usually very reasonable, within the first three months, you get a sign-on bonus that far outweighs any fees that the credit cards might charge.
The second principle to keep in mind is that my strategy is particularly good for those of you who like to travel. So there are other card options out there for those of you who might just want cash back or gift card perks, things like that. Mine is particularly geared for travel. So if you’d like to travel, let’s talk about this.
If you can’t tell, I’m very excited about [00:06:00] this because this is one of those aspects in my life and my business that I feel are very valuable and truly low maintenance and has so much benefit for a relatively little cost.
Okay. Let’s get into the actual strategy.
The core of my credit card strategy is what I call the chase double dip. The guiding principle here is that you will have one Chase card for your business and another Chase card for your personal use and that you can transfer points from your business card to your personal card. That is the key here. The transfer of the business expenses and the business points to the personal card. So you can combine points between your business and personal and end up with tons of points.
[00:07:00] The reason that I choose Chase is because they give a 25 to 50% bonus on your points if you use them for travel. Like I said, this is a travel-centric strategy.Let’s say you spend $2,000 a month in your practice on your business card and get 2,000 points for that, and then you spend $5,000 a month on your personal card, you combine those, and you get 7,000 points, right? Well, I’m already noticing that’s a terrible example because it’s hard to calculate 25% of 7000. I’ll stick with it though.
So if you have 7,000 total points, that would equal about $70 that you could spend in travel. And if you get the 25% bonus, then that’s going to give you another extra, I don’t know, 1750. [00:08:00] That is the main reason that I do this Chase double dip is because you can transfer from business to personal and you get a bonus if you use the points for travel.
So let’s go into detail. On the business side, I use the Ink Business Preferred for all of my business purchases. It has a 95 annual fee. Some of you might say, Oh my gosh, an annual fee. I don’t want to pay an annual fee. Well, bear with me. That is far outweighed by the benefits you get.
First off, there’s usually a fantastic sign-on bonus when you sign up for the card of 100,000 points, which equals about $1500 maybe $2000 if used for travel in the right way. So right there, you get $1500 back. That far outweighs a $95 annual fee.
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You also earn three points for every dollar you spend for pretty common business expenses. So it’s a great business card. So for things like dining and meals and software, online expenses, things like that. I use the Chase Ink Business Preferred on the business side. And again, we’ll just transfer all of those points to [00:10:00] my personal Chase card.
On the personal side, I use the Chase Sapphire Preferred. This is our personal card. It also has a $95 annual fee, but it also comes with a very healthy sign-on bonus of at least 60, 000 points, which is worth gosh, what is that? $600 to $800 if you use it on travel. So if you sign up for these two cards, right off the bat, you’ve got at least $2,000 in travel credit ready to be used. It’s actually going to be closer to $2500 because you get a 25% bonus. If that is enticing, stick with me.
So you get bonus points for the Chase Sapphire Preferred, this is the personal card, for dining, groceries, and travel. And again, like I said, the 25% bonus kicks in any time you [00:11:00] use your points for travel through the Chase portal. So you can do the math. $1000 in points becomes $1250, $2000 becomes $2500, and $4000 becomes $5000. It’s pretty amazing.
If you want to upgrade, there is a Sapphire Reserve card that does have a higher annual fee but it has many more perks and it includes a 50% points bonus compared to the 25%. I am about to upgrade to this card simply because that 50% points bonus is huge and will again, outweigh the annual fee.
So that’s the Chase double-dip: Chase Business Preferred, Chase Sapphire Preferred and you flow through transfer the points from business to personal. It’s easy. You set it up once. It’s easy to do on the portal.
[00:12:00] My third card that adds some additional perks that are particularly valuable to me is the American Express Business Platinum Card. Now, this is going to be the most maybe controversial card for a lot of you because of the annual fee. The annual fee is $695. That sounds like a lot, right? But here’s why it’s worth it to me.There’s a huge sign-on bonus that will give you at least $1500 in points. So right there, you’ve covered your annual fee for the first year, but this is a very business-friendly card. What I mean by that is you get statement credits for a variety of expenses that you often spend in your business.
So just two examples are: It gives you a cell phone credit bill or a cell phone bill credit. If you pay your cell phone bill [00:13:00] with the card, you get a monthly statement credit up to, I think, $150 a year. It gives you $400 in statement credits on the Dell computer store, which you can use to buy laptops, technology, and software. There’s a ton of stuff on the Dell computer store, to be honest, once you dig around, it’s not just laptops and computers. So you get $400 in statement credits just for spending at the Dell store. I’ve bought laptops for my employees using that.
Otherwise, it’s great for travel. It is so good for travel. And here’s why. It gives you complimentary lounge access at most airports you will go to. So if you have not stayed in an airport lounge, [00:14:00] it’s basically a private space that often has complimentary food, good food, and drinks for folks who get access to the lounge. So it could be an airline-specific lounge, but it also could be what’s called an Amex centurion lounge, which are truly amazing. So free food, free drinks, and for me, this is valuable.
So if I’m traveling, I’m just going to admit, I’m past the days where I pack a peanut butter and jelly sandwich and a bottle of water to take on an airplane. I used to do that a lot but these days I will opt for convenience. And if I eat in an airport, it’s going to be at least $15 or $20 for the food and at least $10 to $15 for a drink. So if I eat solo, that’s $30 right there every time I travel. If it’s my family, then it’s easily $100 [00:15:00] to eat in an airport one way. So do the math, every trip is basically, $50 to $200 in food in an airport. That adds up pretty fast when the food and drinks are free.
The card also gives you a travel credit of $200 on your airline of choice that you can use for checked bags, seat upgrades, and stuff like that. And what else? There’s a 35% discount on airline tickets if you book it through the Amex portal.
So it’s a fantastic card for travel. And for me, it adds enough above and beyond the previous two chase cards to totally make it worth it. The business credits themselves are totally worth it, but the travel and the lounge access make it 100% worth it for me. There are also many more perks. I [00:16:00] didn’t get into all of them. I just highlighted a few that I really enjoy.
Oh, the other one, I will say this, is you get 100% cost coverage for TSA pre-check and clear which are the services that expedite your security experience and get you through security really fast. So if you like to travel, it’s an awesome card.
Let’s see. I think that’s it. I’m going to keep this pretty short, but hopefully, that wasn’t too much information and hopefully, it doesn’t sound like a crazy sales pitch. I’m honestly just.. this has been like I said, a source of very convenient, free money to travel. And as long as you pay your cards off every month, that is pretty smooth.
So like I said, if you want to check those cards out, the links are in the show notes and everybody will get some extra bonus points. [00:17:00] It’s not for everybody. That’s totally fine. But if this sounds enticing and you can manage the payments each month, you can get a lot of perks and a lot of free travel. So, enjoy.
All right, y’all. Thank you so much for tuning into this episode. Always grateful to have you here. I hope that you take away some information that you can implement in your practice and in your life. Any resources that we mentioned during the episode will be listed in the show notes, so make sure to check those out.
If you like what you hear on the podcast, I would be so grateful if you left a review on iTunes or Spotify or wherever you listen to your podcasts. And if you’re a practice owner or aspiring practice owner, I’d invite you to check out The Testing Psychologist mastermind groups. I have mastermind groups at every stage of practice development, beginner, intermediate and advanced. We have homework, we have [00:18:00] accountability, we have support, we have resources. These groups are amazing. We do a lot of work and a lot of connecting. If that sounds interesting to you, you can check out the details at thetestingpsychologist.com/consulting. You can sign up for a pre-group phone call and we will chat and figure out if a group could be a good fit for you.
Thanks so much.
The information contained in this podcast and on The Testing Psychologist website are intended for informational and educational purposes only. Nothing in this podcast or on the website is intended to be a substitute for professional, psychological, psychiatric, [00:19:00] or medical advice, diagnosis, or treatment.
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