Paying your bills with Credit cards
Well, with all this talk about #ApplePay I thought I would mention a simple, but effective strategy for collecting points using the good ‘ol fashioned credit card.
I’m always reading American blogs where they are getting points for pretty much doing anything – even paying your biggest bills like rent and certain monthly payments.
We don’t have it quite so good here but there are ways to maximize your points by paying attention to your bills.
My friend just got into this whole “point” thing and seems to be loving it like I thought she might.
I did a post a couple months back about how you can get enough points for a free flight just by gassing up at certain gas stations – about 9000 points a year for a couple. Click here for that post.
But my friend has been looking into paying all her regular monthly and bi-monthly bills with a credit card.
I think this is a great idea – for her – and other people that can manage their credit well enough that this won’t cause extra confusion and cause you to pay interest on your charges.
That is the key – organization. She told me most of her bills can be paid by credit cards and feels confident this won’t cause confusion.
I already pay my cell phone and insurance by credit cards, but you obviously can pay many more than that.
When you think about it, it makes perfect sense. Why have auto-withdrawal from your bank account when you could be gaining major points each month towards travel?
The question is – how many points is this really?
Well, lets say you paid your bills with the Amex Starwood Preferred Guest Card – my personal fav.
This way it is simple to calculate – 1Starpoint for every dollar you spend.
“Ah yes”, you say “but certain cards give you 2 points per dollar spent!”
This is true. But lets do one example. The IHG Rewards Club Mastercard gives you 2 points per dollar spent. Is this good though?
Depends on how you value your points.
The IHG points are straightforward. Each point is worth .7 of a cent. You can google that or just buy them straight up for that – 10,000 points would cost you $70.00.
So, are Starpoints worth twice as much as IHG points? Well we also did a post on Starpoints a few months back.
Yes they are. For our purposes, staying in hotels around here or in destinations we are likely to go, they are worth 5 cents each! Even conservative bloggers give them a value of 2 cents each, but most give them a value of 2.5 cents each.
Ok. So what will my average spending on monthly bills get me with this card?
Well, we need to find out how much, on average you could pay per month.
Rather than go through a bunch of scenarios, let’s say you can pay as a family, $750 a month.
Insurance, phone bills, internet, TV and some of the bigger bills like hydro and gas. That all depends on who the provider is and if they take a certain credit card.
But $750 is not unrealistic for sure, probably more if you can get your bigger bills in there.
So, lets do the math. $750/month times 12 months a year = $9000 a year spent.
If you are currently paying those bills by auto-withdrawal or online banking without getting points…ouch.
I’ll just give you 2 different travel bonuses you can get from that.
Amex SPG Card – 3 nights in a Category 2 hotel. (worth about anywhere from $200 – $450 in hotel stays)
Amex Gold Rewards Card – convert those 9000 points to Avios – 1 free short haul flight on US Air or American Airlines. (Detroit to places like NYC, Washington, Philadelphia, Charlotte)
Don’t forget the sign up bonuses you get just getting those cards!
SPG Card – 10,000 points with a $120 fee
Gold Rewards – 30,000 points with no fee first year.
So, between paying your regular monthly bills and getting gas at certain stations you can rack up serious travel perks!
Again, to pay your regular bills by credit card make sure you are organized enough to do this!
Check our Amex page for the specifics.