Monthly Spend on Daily Drivers

[sdsoccerdad]

I typically carry 3-4 cards in my wallet.  Chase marriott visa, Amex PRG, Discover for bonus category spending and sometimes my Nordstrom visa.  Between the PRG and Marriott Visa, I put about 3-4K a month on it.

[Anonymous]

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@Anonymous wrote:

Hey, guys.

I am curious what some of you think about a minimum monthly spend on a daily driver that would make it worthwhile to use the card as a daily driver?

For instance, if you spend about $3000-3500 monthly on two "daily drivers" is it worth adding a third "daily driver" if the monthly balance is going to be under , say, $250? 

As far as rewards go, even $250 monthly at a high rate of 5% would only earn $12.50 monthly. That's $3000 a year, and even the card's value for that amount would be reduced by the other two "daily drivers," to some extent.

Basically, what I am asking is what you think the minimum monthly spend on a third card would be to make it worthwhile to use it as a third daily driver, and if it is too low, then maybe the other two daily drivers are enough.

AMEX BCP and CITI DC are used heavily, but the third "candidate," Cap One Savor is dining only. Even at 4% I am wondering if $250 monthly is even worth bringing it into the picture. It is simpler to use two cards.

What do others think?

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Given your set of facts, it may not be worth it, where Savor (4%) would get you $120/yr or $90/yr (for 3% Savor) and Citi DC (2%) would get you $60 for the same spend.  On the other hand though, if you're 3rd DD is a No AF card, what is the harm?  At the end of the day, does it really matter what card the cash back comes from?  Money is money and spends the same.  I would think if you are deciding in terms of UR, MR, or other points or miles, you would/could be diluting and/or slowing of those point/miles acquisions.  However, cash is different.  As you can see in my signature I have a few cards to choose from, and depending on the quarter, my daily drivers change with the exception of Citi DC.  But if you're trying to keep things very, very simple, I don't think adding a 3rd cash back card is harmful or too cumbersome.  

[longtimelurker]

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@Anonymous wrote:

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  At the end of the day, does it really matter what card the cash back comes from?  Money is money and spends the same.  I would think if you are deciding in terms of UR, MR, or other points or miles, you would/could be diluting and/or slowing of those point/miles acquisions.  However, cash is different.  As you can see in my signature I have a few cards to choose from, and depending on the quarter, my daily drivers change with the exception of Citi DC.  But if you're trying to keep things very, very simple, I don't think adding a 3rd cash back card is harmful or too cumbersome.  

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While I agree the impact is much less than in UR/MR etc, there is still a slight dilution for those cashback cards that have a min redemption threshold.   So if you are using multiple cards, such as Fidelity Visa and DC, it will take a little longer before you can redeem anything.   Not really a big deal, and you could of course use cards with no min.

[QuakerOatmeal]

My daily driver is the BOA Premium Rewards card. It is just so so good to me. 90% of my spending goes on it, with a bit of fringe spending on AMEX.

I get on average 500 in cash back on my Premium Rewards card per month, it's just too rewarding to not use on most of my spending.

[iced]

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@Anonymous wrote:

Hey, guys.

I am curious what some of you think about a minimum monthly spend on a daily driver that would make it worthwhile to use the card as a daily driver?

For instance, if you spend about $3000-3500 monthly on two "daily drivers" is it worth adding a third "daily driver" if the monthly balance is going to be under , say, $250? 

As far as rewards go, even $250 monthly at a high rate of 5% would only earn $12.50 monthly. That's $3000 a year, and even the card's value for that amount would be reduced by the other two "daily drivers," to some extent.

Basically, what I am asking is what you think the minimum monthly spend on a third card would be to make it worthwhile to use it as a third daily driver, and if it is too low, then maybe the other two daily drivers are enough.

AMEX BCP and CITI DC are used heavily, but the third "candidate," Cap One Savor is dining only. Even at 4% I am wondering if $250 monthly is even worth bringing it into the picture. It is simpler to use two cards.

What do others think?

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I think there's two factors involved in making this decision:

1. If the goal is maximum return on spend, how is that defined? In my case, my one and only care about CC rewards is airline miles (with specific carriers) - everything else is pretty much worthless to me. If I can choose between 3% cashback or 1 airline mile for a category, I'll take the airline mile every time. This means that, for me, I have a much smaller set of cards I need to work with and thus can attain that maximization without much splitting of spend.

2. For me, my catch-all card is what I would define as a daily driver, and my spend on it is usually only few hundred per month, but my dining/travel spend is many thousands per month. I already have a specialized card maximizing dining/travel, so do I even bother over splitting a few hundred to gain what would amount to maybe a few thousand extra miles per year? No. Each person needs to define their own line in the sand, but if a card isn't generating at least $1,000 in additional point value per year, I'm not going to bother splitting beyond the first daily driver. Splitting is inconvenient, and my convenience is money.

I also tend not to look at it month-to-month but rather year-to-year. I may go several months where the only spend on my daily driver is a cable bill ($80), gym membership ($80), and $100 in miscellaneous expenses (groceries, gas, clothing, etc). Then one month I might spend $10,000+ on a painting or the like and then go right back to spending $250/month for several months. Those spikes can greatly affect point return over a year's time.