MoneyAccumulator.com

by Das Brain

Does Your Credit Card “Benefit” You In Anyway?

You must be asking yourself, what in high heavens does Das Brain mean?

Well, let me put it this way. Does it give you any sort of reward points? Like Air Miles, Sony points, points for department stores or a certain hotels / airlines?

Next question to ask yourself is, does the credit card charge you an annual fee?

The purpose of this personal finance article is to show you how you can benefit with a credit card that offers reward points, without getting yourself in financial trouble. This is a method I learned when I first began working for a global enterprise software company 6 years ago, the story goes something like this.

When I joined the sales engineer team, my senior co-worker said to me “Apply for every airline and hotel reward program there is, you might as well benefit from all the travelling you will be doing for work…..uh…oh ya also apply for the CIBC Aerogold Visa card.” So being new to the sales system engineering department I followed by seniors advice and did just that.

The territories I covered as a sales engineer was primarily Asia Pacific which included Australia and New Zealand. However, when I wasn’t working in those regions I had to fill in and visit customers in Canada and the United States. I was about 80% of the time on the road. I was in Asia, Australia and NZ four times a year, 1 month each time, it was brutal on the body and mind.

The pay off in points though was huge and I was very glad I took my senior co-workers advice. Aside from company paid airline tickets, I collected points on my CIBC Air Canada Aeroplan credit card when I stayed at hotels, when I took taxis, and when I dined out, and you could imagine that the points just kept accumulating and accumulating. To this day, I still have Aeroplan points left over from 2 years ago…..enough to fly my wife and myself to Australia and back.

When I got back to head office, I made sure to hand in my expense report A.S.A.P and get the cheque for all the expenses as quickly as I can from our accounting department. Once I got the expense cheque I deposited right away and paid the reward points credit card off.

One day, while sitting in an airplane I had a spark set off in Das Brain…oops sorry I meant in “the brain.” I thought to myself, why am I only using the airline points reward credit card for business travelling expenses, why don’t I use it for my personal expenses as well. Except, I would pay off the personal spending amount online right away with cash in my bank account. I began to charge my personal expenses on the same reward credit card I used for work, and paid off the personal expenses using online banking as soon as I got home. This way I didn’t incur any interest charges for those personal expenses.

If you work as sales or technical sales for a company and travelled a lot for work, this is nothing new to you. However, if this is new to you, it is something that you should think about. It doesn’t matter if you are a house wife, you are a customer service rep……it doesn’t matter anybody can do this. It’s called spending smart and making your credit card work for you and you would be surprise that not a lot of people do this. Only less than 10% of my friends do this. I currently funnel about $2000 of expenses a month through my airline reward credit card, and pay it off right away and I don’t travel for work anymore.

If we do the math 2000 points X 12 months = 24,000 points that is enough for a short-haul flight from Canada to the U.S….let’s say to Miami, Florida. So you see, I can earn enough points in a year to pay for short-haul ticket for my wife, and all we have to do is purchase one for me. That is a huge savings and this is how you get ahead. Just make sure you pay off your expenses right away so you DO NOT incur interest fees, you must be very responsible with paying off the expense right away and that the reward credit card does not charge a high annaul fee.

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This entry was posted on Wednesday, February 14th, 2007 at 3:20 pm and is filed under Personal Finance, Spending. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.