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How should I allocate my spend for end of 2019/2020?

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Regular Contributor

How should I allocate my spend for end of 2019/2020?

Hi all,

I am having a bit of a dilemma on how to allocate my spend across different credit cards in order to get the most out of them in 2020. 

I just got the AA business card from Citi and AA Business Aviator from Barclays in August/September and only plan on holding both for 1 year. I got both for the sign up bonus and don’t see too much value in holding long term since I usually don’t fly American. However, now that I have the card and paid the fee (for Barclays) I am thinking I should use the cards as much as possible this ONE year so I can rack up AA points and then be done with them.

The other issuer I want to focus on is Amex. I have a $450 annual fee due in February for my Amex Hilton Aspire and I heard that spending more with Amex can increase your odds of getting the fee waived. So I’m stuck between whether I should spend with Amex or my AA cards. This wouldn’t be much of an issue except for the fact that I don’t spend more than $500-1000 per month (including bus.) so I don’t have much spending to actually allocate.

Then, I just got the Ink Preferred card and I’m $400 away from hitting my SUB. I have until end of January to do that. The SUB is my number one priority but I also feel bad just cutting off all spending after I get the SUB. I typically spend on the new cards I get consistently for like 2-4 months after I get my SUB. If I were to do that, it would even further split up my already small monthly spending.

I’m looking for advice for what someone would do if they were in my shoes and where to best allocate their spending given the above described situation. Thank you for your help!

Message 1 of 21
20 REPLIES 20
Community Leader
Super Contributor

Re: How should I allocate my spend for end of 2019/2020?

I'm sorry that this is not an answer to your question, but IMHO you should space applications far enough apart where you have adequate time to meet the required spend and also be in a good position where the spend is organic and not forced. Trying to spend $X to get a bonus, much less more than one, or spending unnecessarily is not a place one should be. Just my 2cents. 

The second thing is you dont want to be viewed as a churner, which is exactly what you're doing. Spending just to get the bonus and then closing or SD the card at 1yr can and sometimes might curtail you from getting future cards from that specific lender. Also, suppose lender sees a pattern or something against their TOS and claw back points you've earned or shut the card down. You have to ask yourself, is a possible adverse action worth it? 

 

Now that you have the cards, and if I were you, I would focus the majority of spend on the card that the promo expires first. 

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Message 2 of 21
Valued Contributor

Re: How should I allocate my spend for end of 2019/2020?

Amex Hilton will not be a long term card, and betting them waiving AF is not a long term solution. If you have no intention of keeping this card long term, why worry about the AF waiving?

 

AA cards only award AA miles, and the earning rate is not high, if you don't fly AA much, it doesn't earn you much miles.

 

CSP is also a low earning card.

 

I guess I am confused about your strategy here. Are you trying to assemble a core set of long term cards, then churn a few here and there when you see chances?

 

Or are all your cards just for churning? Now thats a situation that most will probably not be able to help.

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Message 3 of 21
Community Leader
Mega Contributor

Re: How should I allocate my spend for end of 2019/2020?

Im a bit confused so forgive me. With you getting all these Sub cards then saying you only spend like $500 a month, which screams my level of income which is really low, im not sure if Sub chasing is a wise move. More than likrly you have a high income and i misread but id still be careful about churning cards. Try and get cards that fit your spend. Sorry if i read your post wrong.
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Message 4 of 21
Super Contributor

Re: How should I allocate my spend for end of 2019/2020?

Congrats on getting the SUB on several cards. That can assist you in getting out for nice trips. 

I really doubt there are stories of getting AMEX $450 and $550 fees waived. More likely is my case where I called them a few months ago to cancel Bonvoy Brilliant, fully intending to do so, and they offered me a 30,000 Marriott points retention bonus, if I spent $3k on the card. Aspire will be the same way; there are so many ways to get the AF back that AMEX really doesn't want you in the card if you can't pay the $450 AF in cash. So you should either plan to close the Aspire, or start planning which Hilton Resort property you will use the $250 credit at, sign up your airline for the $250 bag fees / lounge fees / snacks-on-the-plane credit, and figure out where your free weekend night will be used. With the devaluation of Marriott points and even the free night 50,000 point certificate being harder to use, I am more likely to really close my Marriott card next AF.  

If you have an active SUB you are trying to reach now, that should take priority. If you are really close to the deadline, then even 5% category cards get temporary SD status, since SUB are often a lot more than that rate.... if you can complete the spend for the SUB in time.  

If you know the AA cards are on the chopping block, then I would look at your AA miles balance, and in 2020 see what sort of spend you need to get to a next redemption level. I am at about 45,000 AA miles, so am using my Miles Up card on grocery spend where my AMEX Gold does not code as grocery, to inch closer to 50,000 miles. But Mile Up is a no-AF card. If you have a smaller balance of AA miles, like 3,000, then that's probably a write off. 

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Message 5 of 21
Super Contributor

Re: How should I allocate my spend for end of 2019/2020?

With your spend being so low, I would question whether high AF cards make sense. I also agree with the above poster that stretching your spending to reach a SUB just does not make financial sense. Overspending is not worth a bonus.

 

I think it's unlikely Amex will outright waive a $450 fee, no matter how much you spend on the card. The fee is charged for the benefits of the card. I think the best you can hope for is something to help offset it, but not wipe it out completely.

Message 6 of 21
Regular Contributor

Re: How should I allocate my spend for end of 2019/2020?

Thank you all for your thoughts! Here are a few clarifications to my post.

1) I am very frugal Smiley Happy I earn above the median household income of 55K but I keep my expenses low by living with my parents and spending money on travel, gas, and dining mostly. I have the income to support the debt service on all of my cards so I have not gotten into debt with SUB chasing.

2) I was lucky enough to score a deal with my parents to pay all of our property taxes (about 7K) this year on my credit cards and get paid back from them in cash which helped me meet the minimum spend for the Citi AA Bus. And the CIP for the most part. In fact, being able to pay the property taxes this year was the WHOLE reason I decided to apply for the Citi AA and CIP because I would never meet the minimum spend requirements otherwise. Please keep in mind that I run my business out of my parents house so it is a business expense in my book.

3) I’m not looking to be a churner, but at this point I have already acquired my long term base so I figured I could push to get a few SUBs at the end of the year. I have a full chase set up with CFU, CF, and CSP, and now, CIP. These cards are definitely not going anywhere. I also have the Amex BBP and Delta Blue which aren’t going anywhere either.

What’s left in my wallet is the Hilton Aspire and the Citi AA And Barclays AA bus. cards.

The only one of these 3 cards I foresee adding to my “keeper card” list is the Hilton Aspire because I got a ton of benefits out of it this year and enjoy the PP access. However, my goal this year (year 2 of paying the annual fee) was to see if they could give me a retention bonus.

I think regardless of if they’re going to give me one or not, I’m going to keep the card for at least another year because I have future Hilton trips in mind, but my question was whether I should be spending all my money on the Aspire from now until February in order to have good chances of getting a retention offer, or if I should spend all my money on the AA cards since I’ll likely cancel them in August/September so it’s “now or never” to collect AA points.

4) I understand that I am technically churning the 2 AA cards, however, I already paid an AF on the Barclays one when I opened it so I wouldn’t say it’s churning if I’ve already paid them. If I cancel Citi this year without paying the AF then I understand there could be repercussions with them as a lender. I’ll need to think about this as next summer comes around.


I’m sorry for this long and likely confusing post. Please share your advice Smiley Happy
Message 7 of 21
Established Contributor

Re: How should I allocate my spend for end of 2019/2020?

My advice: pick a reward platform you are interested in earning rewards from (cash back, MR points, AA miles, etc.) and stick with that. Your regularly monthly spend isn’t high enough to spread your rewards across several different platforms. By spreading it out, all you are doing is diluting what reward earning potential you do have.
Personal Credit -
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PNC: Cash Rewards, Points
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PSECU: Founders
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CapOne: Quicksilver
Discover: IT Chrome, IT
Synchrony: PayPal 2%, PayPal Credit
Barclays: Uber
PenFed: Power Cash Rewards
Store Cards: Target
AU Cards: Citi Rewards+

Business Credit-
AMEX: Blue Business Plus, Amazon Prime, Simply Cash Plus
Message 8 of 21
Regular Contributor

Re: How should I allocate my spend for end of 2019/2020?


@The_Asset_Underwriter wrote:

Hi all,

I am having a bit of a dilemma on how to allocate my spend across different credit cards in order to get the most out of them in 2020. 

I just got the AA business card from Citi and AA Business Aviator from Barclays in August/September and only plan on holding both for 1 year. I got both for the sign up bonus and don’t see too much value in holding long term since I usually don’t fly American. However, now that I have the card and paid the fee (for Barclays) I am thinking I should use the cards as much as possible this ONE year so I can rack up AA points and then be done with them.

The other issuer I want to focus on is Amex. I have a $450 annual fee due in February for my Amex Hilton Aspire and I heard that spending more with Amex can increase your odds of getting the fee waived. So I’m stuck between whether I should spend with Amex or my AA cards. This wouldn’t be much of an issue except for the fact that I don’t spend more than $500-1000 per month (including bus.) so I don’t have much spending to actually allocate.

Then, I just got the Ink Preferred card and I’m $400 away from hitting my SUB. I have until end of January to do that. The SUB is my number one priority but I also feel bad just cutting off all spending after I get the SUB. I typically spend on the new cards I get consistently for like 2-4 months after I get my SUB. If I were to do that, it would even further split up my already small monthly spending.

I’m looking for advice for what someone would do if they were in my shoes and where to best allocate their spending given the above described situation. Thank you for your help!


You and I have a lot in common! 

 

Like you we have our base cards covered and are now doing a little sub chasing.  And like you we don’t have large expenses but can afford to float some cash and shift some spend as needed.  And like you between DH and I we also opened multiple new AA Biz cards and a new CIP and a new Cap One Venture.

 

So I think I understand where you are from and this is what I would do if I were you:

 

CIP - Obviously meeting the minimal spend should be the top priority. Afterward you want to keep at least one Chase card to hold the UR and if you want the ability to transfer UR you need a UR transfering card.  I would suggest keep this card long term and put cellphone and internet bills on it.  If UR transfer is not immediately needed you can downgrade it to CIC after one year but do not close it.  In the future when you need to transfer UR you can either upgrade it back to CIP again or open another CIP for another SUB.

 

AA cards - Now you do not need to keep them long term after your miles post.  Since you have multiple AA Biz cards I would keep at most one (I prefer Citi over Barcalays) for a year and close the rest as soon as miles are earned.  After one year, you might open a no AF fee personal card but only if AA miles expiration becomes a concern.  I would not go out of my way to put extra spend on it unless there is a clear redemption milsestone goal.

 

Amex Aspire - I would not count on annual fee waiving therefore I would not worry about putting extra spend on it.  I think your best strategy is to downgrade to the no AF version after one year so you have a card to hold the points.

 

One thing I agree with everyone else, since we both have low natural spend it is particularly important for people like us to pace the apps and not to spread the spend too thin.  If you are not loyal to AA (we live in an AA hub so we kind of are) or Hilton, there is no need to tie yourself to them.  

Message 9 of 21
Regular Contributor

Re: How should I allocate my spend for end of 2019/2020?

Wow! @FieryDance we have a lot in common indeed!

Thank you for all of the insight. I am definitely keeping a UR transferring card Long term whether it’s my CSP or CIP. I Would like to keep the CSP and downgrade the CIP next year but time will tell which one better matches my spend.

Thanks for the tips on the AA cards. I definitely prefer Citi over Barclays too but I’ve heard if you talk with Barclays customer service reps they may waive annual fees forever on the Biz side. If that’s the case then I’d rather keep the Barclays and just SD to keep my miles alive. My main goal with AA is to get enough miles to redeem 2 economy tickets Air Tahiti Nui in the next year or two. I have 125K currently but redemption rates are around 70-80K per person round trip during the season I want to go, so I need like 40K more. Although I highly doubt I’ll earn that much in 1 year, I can make a dent in that number and maybe buy the rest of the miles when the time comes to book this aspirational trip.

I’m not necessarily loyal to Hilton but I do enjoy the perks that come with the card. If I downgrade it, I’ll probably upgrade CSP-> CSR to get the priority pass and travel credit.

Ugh! Decisions decisions! Thanks for your input @FieryDance Smiley Happy


Message 10 of 21
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