The 3-Tier Credit Card Rewards System--How I've saved nearly $30,000 from credit cards

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2 жыл бұрын

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I'm going to cover the three tier system for earning credit card rewards. This is the system I've used over the past couple of years to generate nearly $30,000 in credit card rewards. We save and invest all of our rewards in M1 Finance. This system, however, can be used whether you save and invest the rewards like we do, or spend the rewards on travel or other purchases.
The great thing about this system is that it's very simple, and it will help about 99% of the people maximize their credit card rewards without carrying a dozen or more credit cards.
Tier 1 Credit Cards
Wells Fargo Active Cash
Citi Double Cash
Fidelity Visa: www.fidelity.com/cash-managem...
BofA Premium Rewards: www.bankofamerica.com/credit-...
Tier 2 Credit Cards
Amazon Prime Visa: www.amazon.com/Amazon-Rewards...
Target RedCard: www.target.com/redcard/about
Walmart Card: www.walmart.com/cp/walmart-cr...
Amex Blue Cash Preferred
Amex Gold
Tier 3 Credit Cards
Chase Sapphire Preferred
Chase Sapphire Reserve
Amex Gold
Investing Tools & Resources
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#creditcards #cashback #robberger
ABOUT ME
While still working as a trial attorney in the securities field, I started writing about personal finance and investing In 2007. In 2013 I started the Doughroller Money Podcast, which has been downloaded millions of times. Today I'm the Deputy Editor of Forbes Advisor, managing a growing team of editors and writers that produce content to help readers make the most of their money.
I'm also the author of Retire Before Mom and Dad--The Simple Numbers Behind a Lifetime of Financial Freedom (amzn.to/3by10EE)
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DISCLAIMER: I am not a financial adviser. These videos are for educational purposes only. Investing of any kind involves risk. Your investment and other financial decisions are solely your responsibility. It is imperative that you conduct your own research and seek professional advice as necessary. I am merely sharing my opinions.
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Пікірлер: 75

@JesseDayKR 2 жыл бұрын

Always solid content with you Rob, love the long-form videos that go into detail.

@nuevocomienzotampa6052 2 жыл бұрын

Thank you for taking the time and explain this information in simple terms.

@Harry_16710 2 жыл бұрын

Great analysis, Rob!👍🏼

@Jason_The_Man 2 жыл бұрын

Great breakdown! Thank you!

@dantoddruns 2 жыл бұрын

This was a very simple and understandable way of presenting this.

@betweencoffeeandsleep2713 2 жыл бұрын

You have a lot of great content, but this one is exceptionally strong. Specifics around strategy of use and card choices push it over the top. 100% of my spending goes on the Fidelity card. I like compounding my rewards.

@goonies_never_say_die 2 жыл бұрын

Put differently, using a credit card to save 2% for investing purposes is a novel way to build wealth slowly.

@bryansnyder9218 2 жыл бұрын

Great video, I also use credit cards for rewards and pay them off. I have gotten back around $6,000 over the last 10 years, it adds up and is great passive income.

@roberttaylor179 2 жыл бұрын

Very interesting video, Rob. One thing to also consider is monthly recurring expenses, I get 5% on my cell phone and cable bills with one card. Also, I live in the city, and can pay my parking fee through a 2% card. I pay everything that can be paid on a credit card with a few different cards, rotating through the best deals. It doesn't work for everything, however. For example, my utility company charges a "convenience" fee to pay by credit card, which far exceeds my cash back benefit, so bills like that have to be paid the old fashioned way. As always, for this to work, NEVER carry a balance on any card.

@CalmerThanYouAre1 2 жыл бұрын

Great video. Would love to see a review of the new M1 Finance credit card. Looks like a pretty strong contender to be the best option for tiers 1 and 2, especially if you’re already an M1 Plus member.

@rob_berger 2 жыл бұрын

I've talked to M1 about the card. It's an interesting approach, but I'm waiting for more details to determine if it a real contender or more of a gimmick.

@JoshTC2 2 жыл бұрын

Great picks. I think rotating 5% back cards would be a great add to the tier 2 piece. Adds more complexity but it makes a huge difference especially if a category lands on a consumer’s high spend area.

@ImOriginallyGreen 2 жыл бұрын

One of the issues I have with these cards is that the limit on 5% rewards per quarter is $1500 in spending on the category for the 2 cards I have. Some quarters have categories I spend no where near that amount and other quarters I max out the 5% almost immediately within the first month. Oftentimes it’s just usually easier to just get the 5% card specific to the rotating category, IE Amazon/WF, Target, Walmart, groceries card because then it’s year round and there’s a higher limit on the rewards.

@donh8223 2 жыл бұрын

@@ImOriginallyGreen Yeah it looks like there is no limit on the WM card , good find @Rob Berger

@kanegs1 Жыл бұрын

How do you manage paying these cards off? How do you get the cash out and into M1?

@D0NTsmokeCRACK 2 жыл бұрын

Rob, you mentioned that you have the BofA card with the platinum honors which implies that you have a decent amount invested with Merril Edge. Can you please do a video on the Edge platform? Maybe why you chose it, what you like and dislike. I’m planning of leaving ML guided investments and sliding to Edge seems like the easiest move but it doesn’t seem to get talked about much. I’m finding it very hard to find an in-depth analysis of the platform. Really appreciate all your help. I learn something new every video.

@foreign_agent 2 жыл бұрын

I have some experience with ME and my feeling is it's not the most intuitive, I'd say it's about 75% 'there' in terms of functionality, but has a few issues. Granted there is no perfect platform. One issue is they do not allow to submit multiple trade tickets at once, you need to do one at a time. There is also no way to select default 'reinvest dividends' option - you need to go to a separate menu after the fact (at least in my experience). That said, for what it is and given that it's totally free, the ME platform seems adequate for occasional (!) trading/investing. I doubt that it's the best of all platforms out there, but they seem to try their best. I've had an OK experience with their phone support. I'd encourage you to give it a try with a small balance and see how it goes, before completely switching to it.

@celtosaxon 2 жыл бұрын

SDFCU has a 2% card that also has no foreign transaction fees (unlike the ones mentioned in this video which do), so it’s a good tier 1 if you have overseas spend

@trevpoint18 Жыл бұрын

How are you actually putting these reward points into a brokerage account to actually invest them? For example the Citi card you spoke of?

@foreign_agent 2 жыл бұрын

Thank you, interesting perspective and useful to consider. My main question was, is all the hassle of managing multiple CCs and tracking all the nuances worth the extra $80-100 cash back, if it takes relatively large monthly spend level to reach that. Might it not be easier to instead focus on controlling spending and saving/investing that extra $80-100/month, as opposed to spending enough to get that cash back? Many thanks.

@brandonwilson5727 Жыл бұрын

If you’re gonna spend the money regardless why not get a benefit from it. 🤷🏼‍♂️ That’s the way I see it.

@fredf9562 2 жыл бұрын

Hmmm. This cash back video is very timely since I will be a WFH employee for the duration of my career so my point/miles accumulation will be for naught. Thank you again for the Portfolio Visualizer tutorial. I’ve another question. For an 18 year old prospective investor with a job, who wants to open a ROTH what should they invest in for the long term, set and forget. I’m thinking of recommending equal allocation of VHT, VGT, and VBR and balancing it annually and perhaps using M1 Finance to make it easier to manage. Any thoughts? How about a video advising your viewers’ children? Enjoy the long weekend.

@tracythompson1692 2 жыл бұрын

One thing to be aware of with the boa premium rewards card is there is an annual $100 credit towards travel. I buy a $100 aal gift card each year which qualifies for the reward. This offsets the annual fee on the card.

@bryansnyder9218 2 жыл бұрын

I have the American express preferred cash. Worth the fee because of grocery's

@briandarnell1809 Жыл бұрын

I've been searching for the best cash back card with no foreign transaction fees. Any suggestions?

@torchy187 2 жыл бұрын

Using Fidelity Visa and Verizon Visa.

@davidmarble5159 2 жыл бұрын

What about foreign exchange rates?

@kokalti Жыл бұрын

Great info. I have the Apple Card. It’s really good integration with the iPhone but the points are OK

@carya746 2 жыл бұрын

PNC offers a card that gives you 4% on gas and 3% on dining and shopping. Great card.

@afstravel1429 2 жыл бұрын

Our tier one card is the Capital One Quicksilver card earning 1.5% on all purchases. Is it worth the hassle of unfreezing our credit/applying for the extra .5% earned with the WF card. Also, would I cancel my Capital One card or keep it open and use it occasionally to ekkp the account active? Thanks, really appreciate all your videos!

@rob_berger 2 жыл бұрын

It's probably worth it, depending on how much you charge to the card. Just do the math. Also, unfreezing your credit is easy. I just had to do that and it took just a few minutes online. As for keeping QS, since it doesn't have an annual fee, I'd probably keep it. Best of luck!

@horizontaldad 2 жыл бұрын

A Sam’s card for gas gives 5% credit back… and the gas can be bought anywhere

@elizabethgarat8493 2 жыл бұрын

Rob, thank you so much for all of the info. I have applied for the Wells Fargo card. Can I use it for auto bill pay, like utilities for example?

@carsonoldson3631 2 жыл бұрын

The Amex Blue Cash Preferred card only lets you redeem the cash back as "Rewards Dollars" which can only be used for a statement credit. How would you make this work for transferring to an investment account like you have done? Would you take the amount of the statement credit you're redeeming and just take that same dollar amount from your checking account to the investment account?

@InteristaS5 2 жыл бұрын

I have the same card and yes I think that might the best way to do it

@Donmoisen 2 жыл бұрын

I watch your program from Bangkok Thailand and I wish that you would mention on these credit card features whether they have a foreign transaction fee or not... it makes a big difference for people who travel a lot overseas or live overseas as I do.

@brianklancke424 2 жыл бұрын

I live in Cambodia. Assuming your ok with a $95 annual fee. The citi premier card gives you 3x on dining, groceries, gas, hotels and airfare with no foreign transaction fee.

@Donmoisen 2 жыл бұрын

@@brianklancke424 based on the fact that I have a large investment with Bank of America Merrill Lynch I get 5% back on my rewards card with them. It's a $95 fee for a year as well and there's no transaction fee internationally

@brandonwilson5727 Жыл бұрын

I use the Walmart card because I pretty much exclusively use Walmart delivery for groceries. So I get 5% back for groceries. I use the Fidelity card for my everyday purchases. I use the Capital One Venture X as my travel card. 10% back on hotels and 5% back on flights. That’s my trifecta.

@ronaldwinters2503 2 жыл бұрын

How do you get the rewards invested into an investment account?

@aaront936 2 жыл бұрын

Log into whatever cc account and redeem your points as cash back and deposit them into your investment account. Usually at a 1 point to .01 rate.

@tracythompson1692 2 жыл бұрын

Im a landlord and pay my advalorem property tax each yr using the boa card with honor level bonus.

@Niafunn 3 ай бұрын

I might take advantage of a introductory offer or two but I don’t have 50000 dollars of expenses a year to put on a credit card. I ultimately feel like the cents aren’t worth the hassle. Your biggest expenses you usually can’t pay on a credit card. If you’re spending 4 or 5 grand on a credit card a month just make that 3900 or 4900 and invest the 100 a month and skip all the mental gymnastics. I guarantee you over spend at least that much when trying to maximize cents. I hate when people say points like they won something. It maximum 5 pennies per dollars.

@donh8223 2 жыл бұрын

@Rob Berger The link for the Amazon card takes you to some one star reviews, nobody likes it. Older reviews though. Also, it looks like the Target card is not a rewards card, but a 5% discount card,

@rob_berger 2 жыл бұрын

No idea why people wouldn't like the Amazon Prime card. 5% is hard to beat. And the Target card is a reward credit card.

@donh8223 2 жыл бұрын

@@rob_berger Yes the Amazon card looks good. But that red card from Target is not a rewards card, it's a discount card..... ""The Target RedCard doesn't offer card rewards, points, or cashback from purchases. Instead, you get a 5% discount every time you use the card at a Target store or their website.""

@malaybasu961 2 жыл бұрын

You missed paypal 2% cash card. It tops the other card because it has no minimum redemption limit and no foreign transaction. This is the only 2% cashback card with no foreign transaction fee.

@malaybasu961 2 жыл бұрын

@@docsays When? I did not get any notification.

@tracythompson1692 2 жыл бұрын

I plan open the Amazon card. Didnt even know it paid 5%

@billlittle1257 2 жыл бұрын

How about the capital savor card no fee unlimited 3% cash back on dining, entertainment, popular streaming services and at grocery stores, plus 1% on all other purchases for a tier one card

@rob_berger 2 жыл бұрын

It's certainly a good choice if you eat out A LOT.

@billlittle1257 2 жыл бұрын

@@rob_berger thanks Rob tiller tells me that I do eat out a lot!

@PVNInteriors 2 жыл бұрын

I'm not savvy at all with credit cards. So, here's my dumb question: When you earn these points, how are you converting them into some investable asset? You talk about investing the points and earning interest which then compounds.

@ImOriginallyGreen 2 жыл бұрын

For some cards like the fidelity one, the cash back goes directly into your brokerage account. Though I think I’m general he’s saying that there’s a significant amount of money you can save from using the correct credit card(s) over debit cards/cash/the wrong credit card. What you then do with that savings is up to you.

@rob_berger 2 жыл бұрын

Great question. If I buy an airline ticket with points or miles, I transfer the amount I would have spent from my checking account to my investment account. It has the added benefit of keeping me from overspending simply because I'm using points or miles.

@thefiprotagonist4308 2 жыл бұрын

@@rob_berger Excellent piece! I see now that I could be more efficient with my CC rewards. Thanks

@MikeSellersGA 5 ай бұрын

@rob_berger Good info

@mmactc 2 жыл бұрын

Made a boo boo I said Alliant credit card gave 2.5% interest on up to $10000 per year that’s wrong it on up to $10000 per billing cycle sorry about that.

@WayneMarcy Жыл бұрын

There are some hoops to jump through with the Alliant card to get to the 2.5%. Not sure its worth moving money over there, direct deposit etc monthly. I opened it, now not so sure I am going to use it.

@michaelfriedman2221 2 жыл бұрын

why did you invest in Wells Fargo? Awful company

@rob_berger 2 жыл бұрын

Why is it an awful company? Do you mean as an investment or because of the fake accounts? If the later, the management at that time has been replaced.