As you know by now, the quickest and most lucrative way to earn travel points is with a large credit card sign-up bonus. Banks know that it is easy, so they throw a wrench at us. Hello, Plastiq!
In order to receive the points, you must spend a large sum in 90 days~. Credit card issuers want to get you in the habit of using their card in day-to-day spend. Once you’ve spent that big chunk, they are hoping you will make a minimum payment, thus incurring interest charges.
Don’t pay fees
The key to free travel should be to limit expenses and fees, that should include interest charges. Banks will only charge you interest if you do not pay off your statement balance by the due date. Interest can be charged from the day a particular charge was posted to your account, so be cautious when only making a minimum payment. To be 100% certain you don’t won’t be charged any interest, I recommend setting up auto-payments for the “total statement balance” as soon as you receive the card.
If your auto payments are setup to pay off your entire statement balance on or before the due date, you won’t pay any interest charges. In addition, you can also pay off your credit card before your statement closes, this will prevent a “debt”, A.K.A. – balance, from being reported to the credit bureaus. With a zero balance showing on your credit report, it increases your available credit, thus increasing your score.
Your first statement generally closes 30 days after your account was approved/opened. Most banks will then keep you on a rolling 30 day statement schedule, though some stick to the same calendar day each month. Try to pay your balance to zero before your statement closes to make sure a zero balance is reported to the credit bureaus.
This is by far the biggest hurdle for most people. Who wouldn’t love to sign up for 5 credit cards and earn over 250,000 points? The problem for many is the hefty minimum spend requirements the banks impose. If an average spend requirement is $2,000 in 90 days, most people can’t rack up $10,000 in credit card spend that quickly.
Never, I repeat, never freely spend money in pursuit of ‘earning points’. Blowing your money to earn travel points is never wise. We are trying to get free travel, that means limiting frivolous spending.
The key is to put as many mandatory charges/expenses on your credit card as possible. You must pay rent/mortgage, you must pay your car payment, you must pay your student loans. I think you see where I am going with this.
Hitting your minimum spend
What Plastiq does is open up an avenue for charging necessary payments to your credit card. If you’ve never heard of Plastiq, you might be wondering how a normal person can spend $5,000+ in 90 days on credit card using it responsibly. When you can pay mortgage, rent to your landlord, etc, it makes it very easy to rack up necessary charges, which count towards your minimum spend! Also, there are ways to manufacture spend like selling on eBay or gift-carding.
Plastiq typically charges 2.5% as a fee for their service. By using my referral link, you will receive $500 dollars of “fee free” payments. The catch is that you must charge a total of $500 or more, then the $500 fee-free credit will arrive.
Spend $300 for car payment ($7.50 fee)
Spend $250 for student loan ($6.25 fee)
• Receive $500 fee free credit
Spend $900 on rent, they will mail a check to your landlord and charge your credit card (pay the 2.5% fee on only $400 of the $900 payment –$10 fee incurred)
You’ve now charged $1,450 to your credit card which WILL count towards your minimum spend. Since these charges are what I like to call, necessary evils, there is no harm in racking up these charges. (just be sure to pay off in full on or before your due date) Total fees paid to Plastiq would equal – $23.75
New Plastiq users must sign up using this link to receive the $500 fee-free money after spending $500 in total payments. (bonus shows within 2 days)
Keep in mind, even as you work on your minimum spend you are still earning points. If you signed up for the American Express SPG business card (25k bonus points), you’d have earned 1,450 SPG points just by paying those bills AND working towards your minimum spend. I value SPG points at 2.5 cents a piece, meaning your 1,450 points earned would be worth around $36~. That is more than the fees paid to Plastiq!
The 25,000 SPG sign-up bonus points, that will be earned after meeting the minimum spend, are worth over $600 and can be transferred to over 30 different airlines. Again, free travel is all about minimizing fees and maximizing redemptions. If you have to spend $50 in Plastiq fees to earn over $600 in hotels/airfare, that is a good return.
Does a large minimum spend seem doable knowing that you can pay almost any bill with a credit card?