Cashback without carrying 20 cards.

[kdm31091]

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@Anonymous wrote:

@kdm31091 wrote:

It's probably (for most people) not super important to try to cover every single possible category of spend (eg a card just for drugstores, a card just for office supply stores), because again, spreading it among too many cards just dilutes rewards across many programs often with redemption thresholds.

Now, some people need a lot of prescriptions so drugstores become more relevant, so I'm not saying it's 100% of the time, but generally I think trying to "maximize" every single place you might spend money is going to end up just too much spreading with too little gain.

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As usual, you make an excellent point. That's why I'm trying to reduce the number of card while maximizing my reward. Now, I can eliminate chase freedom and it, if I don't spend over $6000 in grocery and gas. That would bring my total down to 5.

On $20,000 spend/year, the difference of 0.5% equals $100.

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Exactly. The differences tend to be very small absent huge spending, and (to me) makes it not worth having 20 cards or anything like that. Of course, to each their own. I just don't see how anyone gets meaningful rewards out of it unless they are spending many, many, many thousands every month, and if they spend that much they probably don't need to be caring about rewards!

[Anonymous]

Actually, that number is hugh because that's $800 difference. I would need to put $125,000 into a interest bearing saving account with 0.80 apy, ie Sallie Mae savings.

[Anonymous]

I spend $50,000/year + over $20,000 tax

20,000 * .15% = $30 double cash to prepay tax

50,000 * 5% = $2500 

I would need to deposit $395,312 in 0.80 apy saving, to get the same return on investment.

Obviously, i cant max out every cat with 5%. I can understand why some people ms.

[kdm31091]

Right, and not every spend category even reliably offers 5%. Plus, most 5% categories are capped, so your math would not entirely pan out (since after 1500-2000 of spend most 5% categories drop to 1%).

[Anonymous]

That's right, hence my comment about understanding why people ms.

[Anonymous]

When to Sam's to gas. Cheapest competitor was Mobile at $2.6599. Rest at $2.87.
$2.4999/gallon
15 gal(2.4999 x .05 + .16)= $4.27 savings

I'm going to gas at Mobile this Saturday
2.6599 x 15 x .05 = $1.99
Plenti has 10x = .40
Plenty 200 bonus = $2.00
Total savings = $4.39

[tntexans72]

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@Anonymous wrote:
When to Sam's to gas. Cheapest competitor was Mobile at $2.6599. Rest at $2.87.
$2.4999/gallon
15 gal(2.4999 x .05 + .16)= $4.27 savings

I'm going to gas at Mobile this Saturday
2.6599 x 15 x .05 = $1.99
Plenti has 10x = .40
Plenty 200 bonus = $2.00
Total savings = $4.39

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You are pinching my friend  

[longtimelurker]

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@Anonymous wrote:

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@kdm31091 wrote:

It's probably (for most people) not super important to try to cover every single possible category of spend (eg a card just for drugstores, a card just for office supply stores), because again, spreading it among too many cards just dilutes rewards across many programs often with redemption thresholds.

Now, some people need a lot of prescriptions so drugstores become more relevant, so I'm not saying it's 100% of the time, but generally I think trying to "maximize" every single place you might spend money is going to end up just too much spreading with too little gain.

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Agreed on the first point that more and more cash back category cards produce very little marginal return.

Anyone who spends so much on prescriptions that he or she sees value in a "drugstore card" will probably benefit much more from paying lower prescription prices in the first place with a warehouse club membership.

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Historically the major use for a drug store card, like the OBC, hasn't been to buy prescriptions, but to buy "gifts"