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Bonus Credit Card Deals to Build Wealth

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UPDATE JUNE 2019: Bonus Credit Card Deal - AMEX is now giving you $300 (instead of the $250 mentioned before) in sign-up bonus cash using our AMEX card referral link. Add $50 to your take on this one! This credit card is a no-brainer for those with good credit and understand the process concerning the math (below). In January, we also got the Chase Sapphire Travel Card ($750 travel credit already, May 2019).

Every year, we "make money" by signing up for a bonus credit card deal or two. The most recent deal we signed up for was with AMEX. We chose this AMEX card after reviewing the best bonus credit card deal offers. On average, I'd say we have made over $1,000 per year for the last decade by spending 1-2 hours per year seeking out the best bonus credit card deal that works for us.

We have easily made $10k over the past 10 years; maybe spent 1-2 hours/year finding the best bonus credit card deal available, signing up, moving money, etc. That's a $10k return for about 1-2  hours of work per year, or $500 to $1,000 per hour in return. It can be a great return for your time as well; educate yourself and use credit wisely to build wealth.

The strategy we use also includes signing up (regularly) for new Online Savings Accounts with higher interest rates when compared to most local banks. We look for new accounts that offer sign-up bonuses (account opening bonus). Barclay's online savings is currently paying 1.85% interest, and Discover online bank is paying 1.9% interest (Oct. 2018) [UPDATE: over 2.2% as of May 2019]. Both banks paid us a sign-up bonus when we opened the accounts. Our local bank and our credit union are paying less than 0.02% interest. Guess where we don't keep our emergency fund money?

Best AMEX Bonus Credit Card Deal

bonus credit card dealFYI: if you use our AMEX referral link here, you'll get an Extra $50 Bonus (NOW $300! was $250 instead of $200 you get from Nerd Wallet or Mint, not sure why AMEX gives you a bigger bonus using our referral link, but it does).

Read the cash back info, fees and disclosures at the credit card site and determine if it is the right offer for you.

What we'll get:

  • 6% Cash Back at U.S. supermarkets up to $6,000 per year in purchases (then 1%);
  • 3% Cash Back at U.S. gas stations;
  • 3% Cash Back at select U.S. department stores; and
  • 1% Cash Back on other purchases.

    (Terms and limitations apply. Cash back is received in the form of Reward Dollars that can be redeemed as a statement credit.)

Note that this AMEX card does have an annual fee, but you'll get that back in the initial bonus cash after using the card. In addition, zero percent interest for a year (that's important also). Therefore, we'll max out the card and invest the money. In one year, we'll pay the credit card off in full. During this year, we'll invest the money in a interest bearing account (or short-term CD). Our online savings account currently pays 1.9 percent interest; and the bank paid us a sign-up bonus for opening the account! Let's say you get a $10k credit card limit, max it out, then put the money in a short-term CD at 2.5% or an online savings account at 2%. You'll end up with an extra $200 or $250 in addition to the credit card bonus and cash back. If your credit limit on the card is higher, say $20k, you'll have an extra $400 or $500 in the bank at the end of the year plus the bonuses, cash back, etc. See the example below for our expected net return on this one deal.

Example Net Return | AMEX Credit Card

  • $300 (was $250, sign up bonus at AMEX using this link)
  • $360 (6% on $6,000 at grocery stores; TIP - you can buy gift cards for other stores at grocery stores but I''m not sure if that will work for the 6% although some folks claim it worked for them)
    • Eligible purchases are purchases for goods and services minus returns and other credits. Eligible purchases do NOT include fees or interest charges, balance transfers, cash advances, purchases of travelers checks, purchases or reloading of prepaid cards, purchases of gift card, person-to-person payments, or purchases of other cash equivalents.
  • $ 36 (3% at gas stations assuming you spend $1,200/year at gas stations; gas, car wash, lunch, etc.)
  • $300 (max out credit limit and invest the money - online savings, CD - until the due date 1-year later, assumes 3% return on $10k)
  • -$95 (annual fee)
  • $851 (total return growth in your net worth in one year for 1-2 hours of work)
  • $861 - Just added $10 (AMEX is offering a $10 credit until 10/31/2018 if you use this card to pay your cable bill at the biller's website; just made $10 by doing so, it works)

It is an attractive credit card offer for us. Make sure you get more bonus cash ($300) using our referral link; the bonus to you from Nerd Wallet and Mint is only $200; again, not sure why they pay you less than our link. We get a referral bonus in addition.

Please note that we also regularly open online savings accounts that offer sign-up bonuses and higher than average savings account interest rates. We move emergency fund money from account to account and increase our return on those funds by collecting sign-up bonuses. Banks we used for this purpose in the past include: Barclay's Online Savings and Discover Online Savings when they offered sign-up bonuses (both currently pay approx. 1.9 APR interest). I'll post the details shortly.

And some folks say they can't find ways to increase their income; think of it as a side hustle. It isn't all that hard or time consuming. When is the last time you made almost $1,000 in one or two hours? You must have good to excellent credit to play the game. If you don't, cut wasteful spending and focus on improving your credit ASAP!

And, track your financial progress. I use Personal Capital to monitor my net worth, cash flow and profits from recurring revenue streams.

Building Wealth

Using a Compound Interest Calculator - Savings Account Interest Calculator (Bankrate.com tool), you can see how you can build wealth using bonus credit card deals. Again, our average income is about $1,000/year using the credit card and online savings account strategy. Visit the calculator website to create your return estimate.

 

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