Travel notice, and dining bonuses after Chase Sapphire Preferred

[update 1/18/15: Reader Ted reminded me of the American Express SImplyCash Business Credit Card which offers 5% cash back at office supply stores and 3% cash back on up to $25,000 in annual purchases in a single category of your choice, with a list of options including restaurants and gas stations. The card currently has a $250 signup bonus after spending $5,000 within 6 months.]

Traveling for the next 24 days

This is what it's all about, right? We hustle all year not just to pad our bank accounts, but to redeem our miles and points for travel with our loved ones. I'll be bouncing around the country for the next few weeks before heading to Italy for a 10-day caper in Milan, Venice, Florence, Rome, and Naples.

There's always a lot to write about and I don't anticipate much changing around here during my travels, but you should probably expect fewer datapoints that involve in-person experiments and more analysis, news, signup links, and that kind of thing.

I always find spending time with family to be exhausting and unexpectedly time-consuming (but meaningful!), so posting frequency will probably drop to 2 or 3 times per week from my usual 3-5 post frequency until I get back in the middle of January. I don't expect any extended blackout, so don't hesitate to reach out to me in the comments, by e-mail, and on Twitter.

Dining Bonuses after Chase Sapphire Preferred

Having finally thrown off the yoke of Chase's over-priced and under-performing Sapphire Preferred card and embraced the Ink Plus as my source of flexible Ultimate Rewards points, I was left with a serious question: which card should I use for my routine purchases that previously fell under the Sapphire Preferred's "dining" bonus category?

First let me stress that unless you have a lot of reimbursable travel expenses or you manufacture spend, this question shouldn't interest you: you should put all your everyday expenses on a 2% cash back, no-annual-fee credit card like the Citi Double Cash or Fidelity Investment Rewards American Express and never think about it again. Even a person who spends an above-average amount every year is unlikely to recoup the cost of an annual fee in the difference between the value of their spend on a premium credit card and the 2% they would earn on a no-annual-fee card.

If you do manufacture spend, on the other hand, your new "dining" credit card will ideally be one you already carry, either in order to manufacture spend or because it doesn't have an annual fee. Here are the obvious candidates:

  • Sam's Club MasterCard. Both travel hackers and civilians already carry this no-annual-fee credit card because it gives 5% cash back on up to $6,000 in gas station spend each year (the site doesn't make clear whether this is calendar or cardmember year). If you do, you may want to use it at restaurants as well, where it earns 3% cash back, 50% more than a 2% cash back card. Note that rewards earning is capped at a total of $5,000 in cash back per year.
  • Chase AARP Rewards Visa. A lower, but unlimited, 3% cash back earning rate at gas stations may make this card worth carrying if you manufacture a lot of spend at gas stations. If that's the case, it's probably also your best bet for restaurant spend, likewise earning unlimited 3% cash back with no annual fee.
  • Ink Cash. If you already completed your first year with a premium Ink credit card like Ink Plus or Ink Bold, you may have requested a product change to the no-annual-fee Ink Cash. If so, you're in luck: it earns 2 non-flexible Ultimate Rewards points per dollar spent at restaurants. If you have a spouse or domestic partner who still carries a premium Ultimate Rewards card, you can transfer your non-flexible points to their account and keep the ability to transfer them.
  • Hilton HHonors Surpass American Express. Now we're getting into more speculative territory, so we need to be careful: the Surpass card has an annual fee of $75, so this is definitely not a card you should carry just for restaurant spend. But if you already carry it, in order to earn 6 HHonors points per dollar spent at gas stations and grocery stores and Hilton Diamond elite status after spending $40,000 on the card in a calendar year, then you're already implicitly valuing the 6 HHonors points you earn per dollar spent at restaurants at more than roughly 0.36 cents each, after accounting for the annual fee (if you spend exactly $40,000 on the card each calendar year, that's the valuation that recoups both the $800 you could earn with a 2% cash back card and your $75 annual fee).
  • Citi ThankYou Premier. I don't pay $125 annual fees, and don't suggest my readers do so either. But there are a (vanishingly small) number of situations where it might make sense to have a ThankYou Premier card. For example, if you are still sitting on a huge balance of ThankYou points from the days of ThankYou Preferred bonus earning at gas stations, drug stores, and grocery stores, you may have signed up for a ThankYour Premier card in order to increase the value of that stockpile. In that case, why not take advantage of the card's 3 ThankYou point per dollar earning rate at restaurants?

The rest of the bunch

There are other credit cards that earn as much as 3% cash back at restaurants. The problem is there's no reason you would ever have one of these cards, and it's unlikely to be worth a "hard" credit pull to apply for one:

  • Santander Bravo. Earns 3 points per dollar at gas stations, supermarkets, and restaurants, but a low signup bonus, $49 annual fee, and all bonus earning is capped at $5,000 in spend per calendar quarter.
  • Huntington Voice. Earns 3% cash back with no annual fee, but with no signup bonus and bonused earning capped at $2,000 in spend per calendar quarter.

A possible exception is the PayPal Extras MasterCard, which you may well carry for other reasons. The trouble is that you're likely to easily max out the 50,000-point cardmember-year earning limit without spending a dime at restaurants, so using the card there doesn't offer any marginal value over the cards I described above.

Any I missed?

What's your favorite card for legitimate restaurant spend? Did I miss any lesser-known gems? See you in the comments.

[updated] Two Santander products you should know about

[update 2/14/14, 5:55 pm: I just called into Santander to ask what a "Santander Select checking account" is, since the terms and conditions of the Bravo card say such an account is necessary to get the annual fee waived. The Rhode Island-based representative explained that there's no such thing. It's a product that's going to be launched later this year. In the meantime, if you apply for the Bravo card before March 31, 2014, the first year's annual fee is waived. Now you know everything I know.]

Over a year ago, I opened checking and savings accounts with the then-Sovereign Bank, the American division of the Spanish banking giant Santander. They were offering an enrollment bonus of $100 or $150, and I needed a convenient place to dump money orders I'd purchased with PIN-based debit cards at Walmart without undue risk to my primary checking account.

In the last few months, three big changes came out of Sovereign: they rebranded their US branches to Santander; they introduced an oddly lucrative banking product; and they launched a competitive cash back credit card.

extra20 Checking

The banking product Santander rolled out is called "extra20," and it works like this:

  • you hold linked checking and savings accounts with Santander that are registered for extra20;
  • if you receive $1,500 in "direct deposits" to the checking account each month, Santander will deposit $10 into the linked savings account;
  • if you, in addition, make 2 online bill payments using Santander's bill pay system, Santander will deposit an additional $10 into the linked savings account.

Note a few things:

  • If you don't receive the $1,500 in direct deposits, you won't receive either $10 bonus — and you'll pay a $10 monthly fee;
  • If you do receive the $1,500 in direct deposits, but don't make the 2 online bill payments, you'll still have the $10 monthly fee waived and receive $10;
  • I'm not up to speed on what kinds of transactions Santander considers "direct deposits;" it's very likely withdrawals from PayPal, Bluebird, and Venmo accounts will count, but I can't guarantee that.

Fortunately, my employer has an extremely flexible online payroll system that allows me to divvy up my paycheck among accounts however I like, so it's not a problem for me to receive exactly $1,500 in "real" direct deposits each month.

Santander Bravo MasterCard

This second Santander product is only worth considering if you also sign up for extra20, since the card's $49 annual fee is waived for cardmembers with Santander checking accounts.

With the Santander Bravo MasterCard, you earn 3 points per dollar spent at gas stations, grocery stores, and restaurants, on up to $5,000 in cumulative purchases in all three categories each calendar quarter. After spending $5,000 in those categories, and on all non-bonused purchases, you'll earn 1 point per dollar.

But what's a point worth? While the promotional material says that they can be redeemed for "cash back," if you visit Santander's rewards center the only options listed under "cash back" are prepaid MasterCards. It's not a problem to liquidate prepaid MasterCards, but it's not exactly the same as cash back.

So, first the good news: the Santander Bravo has a much higher limit on bonused earnings at gas stations than the Bank of America Cash Rewards Signature Visa, which also gives 3% cash back, but only on the first $1,500 (vs. $5,000) in eligible spending each calendar quarter. If you're deciding between the two, you should obviously go for the Bravo, together with an extra20 package that waives the card's annual fee.

The problem with the Bravo MasterCard is that it's not entirely clear what the card's competitive advantage is over other, well-known credit cards. Assuming you can still purchase Vanilla Reload Network reload cards, PayPal My Cash cards, or prepaid PIN-based debit cards at gas stations, there are already a number of insanely lucrative options to choose from:

  • US Bank Flexperks Travel ($49 annual fee): 2 points per dollar at gas stations, worth 3-4% in paid (mileage-earning) travel redemptions, plus triple points on transactions coded as "charity;"
  • Chase Ink Bold/Plus ($95 annual fee): 2 flexible Ultimate Rewards points per dollar, worth 2.5% in paid travel redemptions, plus opening up other lucrative earning opportunities and partner transfers.
  • Even the American Express Hilton HHonors Surpass card ($75 annual fee), which gives automatic HHonors Gold status and 6 HHonors points per dollar spent at gas stations, plus Diamond status after spending $40,000 within a calendar year, is arguably more valuable than 3% cash back.


It's a tough call for me to pass judgment on the Bravo card, because Santander is basically doing everything right: a waived annual fee for checking account holders; high quarterly limits on bonused spend; and the ability to redeem points at 1 cent each for prepaid MasterCards (compare Citi's ThankYou products, which punish you for choosing to redeem your ThankYou points for cash).

On the other hand, gas stations, grocery stores, and restaurants are extremely competitive bonus categories, and the market is pretty saturated with outstanding cards as it is — although those cards do often come with substantial annual fees.

In short, I think the Bravo card is a pretty good card for a beginner who's interested in earning some extra cash and learning the ropes, but isn't willing to commit to some of the more elaborate techniques we engage in. In that way, it's a great complement to the 2% cash back Fidelity Investment Rewards American Express, especially since you can use it at merchants that don't accept American Express.