I have met many Service Members who strictly use a debit card to pay for everything, even if the option to use a credit card is available. The reason I mostly get when I ask why they do not use a credit card to earn points, is that by spending their own money they are in control of their budget at all times. A secondary reason is that they do not want to max the card and end up in debt.
Ultimately, service members with this philosophy are losing on hundreds, if not thousands of dollars in benefits by not utilizing the right cards, with the right banks, for the right reasons. I try to teach the concept of utilizing credit as a tool to leverage and improve not only one’s credit score, but financial position. In today’s financial market, even the most basic credit card from your local bank or credit union will have some type of rewards program associated with it.
What I do agree 100% on with the Service Member who only uses debit cards to pay for everything, is a concept that I implement with my credit and charge card portfolio, and that is: Always pay your statements in full every month! Why? Well, you get the rewards points associated with the credit or charge card you are using, and best of all is that you are not paying a single cent in interest to the bank. Boom! You are now net positive!
In this post I will be talking about American Express, but this strategy can be used for military friendly banks that waive all annual fees such as Chase, and US Bank through the Military Lending Act (MLA). To learn more about the MLA and benefits associated with the American Express Platinum Charge Card, please check the blog post: Why having the American Express Platinum Charge Card is a must-have for Active Duty members. If you find this blog post helpful and would like to apply for a credit or charge card with American Express, please consider using my link below.
Apply for an American Express Card with this link. We can both get rewarded if you’re approved! http://refer.amex.us/IBRAHR2WLG?xl=cp19
AMEX Portfolio
The snapshot below represents my current American Express credit and charge card portfolio. To learn the “why,” read : Why having the American Express Platinum Charge Card is a must-have for Active Duty members. My spouse also has a very similar set up, in which she does not pay annual fees as well. To learn more about how to get your spouse’s annual fees waived, read: The difference between an authorized user of an Active Duty cardholder and applying for a card as a military spouse.
Why Scale?
Usually, if I ask a Service Member if they have a product with American Express and they say yes, 99% of the time they tell me it is the Platinum Charge Card. When I ask them how many do they have, the answers I get is either 1 or 2. Usually it is the regular Platinum Charge Card and The Charles Schwab Platinum Card.
So if you read the previous articles I linked above, you have a good understanding of the common “cash equivalent” benefits such as the Uber and Saks credits, and the $200 Airline and Hotel credits. Remember that these benefits are per each Platinum Card. Since I have 10 Platinum Charge Cards and so does my wife, let us do the quick math on how much “cash equivalents” we get per year to supplement our income. I also want to highlight that my wife has her cards applying with her social security number, therefore making them unique cards with benefits. You cannot do the below if you have added your spouse as an authorized user, as the authorized user utilizes and triggers the same benefits from the primary cardholder (whoever applied with their social security number).
Uber Credits: (This can also be used in the Uber Eats app)
- By linking all 20 cards to my account, we receive $300 a month ($15 x 20) and in December we get $700 ($35 x 20). For a grand total $4,000 that we use on Uber Eats or groceries delivered through Uber.
Saks: (Enroll in the Saks benefit first for each card)
- We have 20 total unique platinum charge cards. This means that bi-annually (January-June & July-December), we can spend up to $1,000 in Saks, and $2,000 yearly. If there is a Gucci store inside a Saks Fifth Avenue store for example, and the receipt they print has the Saks information, well that Gucci store will also trigger the Saks credit. We have bought multiple Gucci and luxury items for free by having the cash register attendant swipe and charge $50 dollars on each platinum card. That $1,000 Gucci purse is now yours for free after American Express reimburses the $50 dollars on each of the 20 platinum cards!
Airline/Hotel Fee Credits: (Read How to travel for free in four steps using the Amex Airline Fee Credit). Between the 20 cards, that’s $4,000 a year in airline fee credits and $4,000 in hotel credits.
Summary of “Cash Equivalent” Benefits: There are more benefits these cards offer, but these benefits alone add a whopping $14,000 dollars to our annual military salary. This means that we do not have to use our own money to eat at restaurants, groceries, gifts, airline tickets, and hotels.
How to Scale
So how do you scale to having the maximum allowed number of personal charge cards American Express allows? Well, to hit 10 Platinum charge cards, it is a process that will take up to a minimum of 2 to 3 years if you start now. Besides the Platinum charge card, you can open the Charles Schwab Platinum card and the Morgan Stanley Platinum Card. What about the other 7 platinum charge cards?
Well, American Express also offers the Green and Gold Charge Cards. So what you do is apply for the Green and Gold Cards, wait 1 year and then upgrade them to the Platinum Charge Card. If it has been 1 year after you have applied for the regular Platinum card, you can apply for it again as well. After you have you have applied for the green and gold charge cards, waited 1 year and upgraded them to the Platinum charge cards, then you repeat the process of applying for the green and gold cards again, waiting 1 year, and upgrading them to the Platinum charge card.
The process is pretty much a rinse and repeat. Just remember that you will not get a welcome bonus when you apply the rinse and repeat process, as American Express has a rule of 1 welcome bonus per product. So you will get the welcome bonus when you apply for the green, gold, platinum, Schwab, and Morgan Stanley cards as they are unique products. After you re-apply for the regular platinum card, along with the green and gold cards again, no welcome bonus will be given.
Why the Hassle?
The purpose of having more than 1 platinum card, is the end goal as an active duty service member. By having 20 unique platinum charge cards between my spouse and myself, we have added $14,000 dollars to our salary that we were going to use anyways, and can deploy that same amount into other investments.
To learn more about the American Express Platinum Charge Card and the other available American Express product, please click and follow the link below: Apply for an American Express Card with this link. We can both get rewarded if you’re approved! http://refer.amex.us/IBRAHR2WLG?xl=cp19
