017. Travel the World for FREE - Hot Hacks for your Credit Cards
Today, we're diving into the hottest credit card hacks so you can book your next vacation for free. You'll learn to maximize credit card points, credit card rewards, finding the right rewards credit card, and how to play the game without breaking the bank.
In today's episode, we cover the following:
What to expect in future podcast episodes (1:20)
Philosophies on money and credit cards (3:45)
The credit card game that companies are playing (7:46)
Why you should think twice about using a debit card (9:10)
Reaping credit card rewards (10:57)
Credit card benefits to stop sleeping on (13:17)
Finding the best credit card for your travel goals: annual fees and intro offer (19:12)
Transferring points vs. redeeming them in the credit card portal (25:40)
Using a credit card for your business (29:34)
Keeping things simple and not playing the game too hard (31:25)
Transcript
Amber F. (00:00)
Hello, Rich Girls. Welcome back to Old Money, the podcast for women who are building the trust fund they wish they were born with. I am your host, Amber Frankhuizen. I'm so grateful that you're here. You girls keep me young. The amount of feedback that I've been getting has been so positive. I want to say thank you so much for being on this journey. This is a community. This is all of us living our richest lives, earning more, investing more, spending more, living more, traveling more. And that's what this podcast is about today. We are talking about how to hack your credit cards to travel for free. I am actually in the process of doing this right now, or I guess in the process, meaning I've booked the trip, it's for free, and I'm going. And it's going to be one of the best vacations I've had all year. I'm so excited about it, and I honestly, it's no sweat off of my back to have earned this trip for free. I've just learned the rules to the game, and I am here to break them down for you. We're talking about credit card hacking 101.
Amber F. (01:08)
I'm going to break it down for you, let you know how I've been playing the system to get the most out of it in the easiest way possible, which is how we like to do things here. This topic has actually been really hotly requested, but just to give you a little preview of what's going on behind the scenes too. The way that I have so much news to share with you, I just want to be Claudia and Jackie on the toast. I want to bring you the news, and it needs to be like business, money, et cetera. But as you know, the only paradigm I have is reality TV. So I'm breaking down the Kim and Kroy divorce and looking at their assets and how are they splitting up the house and how is this going to work? You guys, I'm psychotic, but got the news for you, including some piping hot podcast industry news that nobody is talking about because I think maybe people are afraid to talk about it. And maybe I'm a little afraid to talk about it, too. You don't want to burn bridges. And it's not a burning bridge situation if we're going to be talking about it that way.
Amber F. (02:05)
It is just something that I don't think a lot of people know that we should talk about. And I definitely want to talk about the letters that have been coming in. I'm so honored people are writing Old Money podcast. Hi, we love you. So Rich Girls and Rich Boys, I've gotten a couple of messages from men recently are, Old Money Men. We see you. We love you. We appreciate you. A great letter from somebody in Australia that wants to talk about the Old Money Man. I've got an incredible letter from somebody who wrote us anonymously on the website, which you can do at Old Money Podcast. Com about being in debt and if they should take out a personal loan. So that one goes to the top of the pile because I'm sure that's a crushing feeling. I know it well. We will help you. We will talk about it as a group. We will share with the class. We're going to break it all down. And then I'm really excited we're going to start bringing some guests on, some experts in the space, in real estate, in luxury travel, and in marriage. We're breaking down everything you need to know about prenups.
Amber F. (03:04)
It's all coming to you very shortly. I'm so excited. It's more than just earning money and living well. We're talking about protecting our assets. I'm giving you the next level old money strategies that you need. So it's coming. Thank you again for sharing this with your friends. Thank you for leaving the reviews. Just thank you for being here. I hope you can feel my heart is so wide open of just gratitude for this experience and this project. Let's talk about credit card, shall we? We're going to go all in today. We're going to go all in like Teddi Mellencamp. I just want to dive into what has been working for me, the things that I've learned and the things that I'm not seeing written about on the internet. First and foremost, I just want to share with you my philosophy on credit cards and money in general. You probably know this if you've listened to other episodes, but I don't want to pay so much attention to my money. I am not recording every cent that I spend. I am not a psychotic logging into my bank account every single day. I must set it and forget it, girly.
Amber F. (04:08)
I have systems set up in my life so that I can focus my energy on other things. And while I certainly maintain my money through my money dates, I'm not psychotic about it. I am not stressed about it. I'm letting it work for me so I can put my energy into other projects like this podcast, right? So for me, I like the smallest amount of management possible. And that, for me, means keeping things very simple. Another thing that I wanted to say as well is that I think it's really interesting as we earn more and as we also observe popular culture and celebrities or wealthy people in the world, you notice that the more money you get, the less you have to spend. As you get more notoriety or more access, you become better connected, you're spending less on everything in your life, whether it's because you're getting gifted PR for beauty or you're getting gifted clothing, or you're doing brand deals or you just have a friend who can get you tickets to the Padres game that you don't have to pay for because your network is growing, your net worth is growing. And it's like more money that's coming into my world that I don't have to spend.
Amber F. (05:20)
It's interesting because actually, The Frugality is the enemy of wealth podcast episode popped off. I got a lot of feedback on that one because people really resonated with this mindset of being afraid to spend or some of the traumas that we hold on to and how that affects our behavior today. And I always thought and I was taught that spending money on something like a credit card annual fee was wasteful, and how dare I give somebody money so that I could spend money for them? But the reality is that just investing that whether it's a $450 or $550 annual fee, I'm getting money back three, four times the amount. And I'm going to break it down for you with some of these benefits that people are not talking enough about. But that whole idea of I'm not going to play this game because the cost of entry is too high, you miss out on all of these other incredible benefits. So if that's ever been something you've worried about, let me know. Frugality is the enemy of wealth. I'm saying it again. I feel like I should trademark that. That and financial fight or flight.
Amber F. (06:24)
So Taylor, I'll call you. But anyway, my other philosophy point on this, and you know I've talked about this, I've been in massive debt before, and I have felt what it feels like in your body to feel crushed by something you can't get out of or you don't see a clear way out of. So my philosophy on credit cards in general. Number one, it's got to be simple. Number two, it's okay to spend a little money to play the game as long as it's within reason, right? Number three is that we are never carrying a balance. So if you're the type of person that carries a balance on your credit card, this game is not yet for you. And that's okay. It wasn't for me for a very, very long time. I know I can't be the only one who's had credit card debt. But when you are paying interest on the purchases that you make anywhere from 11 to 25 to more % on your spending, you're never going to reap the rewards of having a rewards benefit card because you're paying not only the annual fee, but you're paying this credit card company so much money in interest.
Amber F. (07:26)
You guys, banks are big for a reason. People are spending so much money on fees, on interest. When you look at paying down a mortgage, it's despicable how little principal you pay down every time you pay your mortgage bill because so much of it just goes to interest to the ability or the luxury of borrowing money from a bank, right? And one of the things that I think is really important to keep in mind is that we're playing a game here, and we need to know the intentions of the other person in the game. And the way that I look at companies, credit card companies or even bigger companies that are consumer-facing like Delta, Delta Airlines is essentially a credit card company that also moves people around in airplanes. And Starbucks is basically an unregulated bank. Every time you put money into your Starbucks app in your card so you can earn stars, Starbucks is taking that money from you and utilizing it to go invest to build more stores to gain interest on the money they've gotten from you. And you're getting stars in return for free drinks. There is no amount of free drinks in the world that Starbucks could give you that would ever make up for the amount of money they're making on the money that you're lending them by putting it into your Starbucks card.
Amber F. (08:40)
So what's really interesting is these companies are playing us. So we need to learn how to play them back as well to make sure that we even the playing field. And the fastest way to lose the game is to carry a balance on your credit card because again, you're never going to make back the 3, 4, or 5X times reward or investment back on that annual fee. And I'm going to tell you how to do that today. Another thing to mention is just using credit cards in general can be a slippery slope for some people. Now, really interestingly, I went to dinner with some friends recently, and I noticed that when we split the bill, everybody at the table used a debit card, not a credit card. Now, using a debit card is akin to using cash, right? It goes straight out of your bank account into the person that you're paying. I never use a debit card ever, ever, ever. I don't even carry a debit card with me. I carry an emergency $100 bill in my wallet and my business credit card, my personal credit card, and my ID. And that's it. That's the only thing I carry.
Amber F. (09:40)
And by the way, I got the cutest card case in Las Vegas this year. It's a Louis Vuitton. It's just so perfect and it fits in all my little bags. Anyway, the reason I don't carry a debit card is because your exposure is so much higher. If somebody gets into your debit card, gets your pin number, they can withdraw money right away. And that's money that is physical money that they can take from you. It's a lot harder to recover. You also don't get any protections in using a debit card, and you also don't get any benefits from using a debit card. Like I said, you might as well just have cash. But when you use a credit card, if you're not comfortable with your spending or your budgeting, it can be a little trepidatious to wait into the credit card waters because some people have problem with overspending. Like I said, if you're carrying a balance on a credit card, this game is not for you. And if you're still struggling with spending beyond your means, this game is going to be harder to play. Now, that doesn't mean you shouldn't play it or shouldn't try or this is not financial advice, this is just how I look at things.
Amber F. (10:38)
It's one of those things where you need to be really honest with yourself. Is this going to cause you more problems than it's worth? Because if you're going to be dealing with paying down debt, if you're going to be trading cards, you're managing a lot of payments, missing payments, it's going to end up blowing up in your face, and this is all a project that you should abandon immediately. The way that I work my system is that I have one card for my business and one card for my personal. Both of those are in my name, and I reap the benefits of both of those cards. The cards that I have, I have a Chase, Sapphire, Reserve, and I also have a Business, Inc. Reserve, something other for my business. Again, both of those are in my name, so I get to reap the rewards from both of them. And my philosophy is that I'm going to keep these cards for at least two years before switching to get another bonus sign-up. I'm going to get to that in just a second. But one of the things I think that's really important is identifying what's easiest for you.
Amber F. (11:37)
Again, systems are key and making sure that it's easy for you to see your balances, pay them off aggressively. I literally pay off my credit card every time I log into my bank. I just hate to see a balance. I don't know if that's good or bad for my credit score. That's just what I do. Again, the PTSD, the trauma of being in debt, I just don't let it happen anymore. Anyhow, figuring out what card's right for you is going to really determine what your goals are. So figuring out what your favorite hotel brands are, figuring out what your favorite airlines are, what are your goals for having this credit card? Do you want to travel once a year for free? Do you want to earn cash back? What is it that you really need? Now just an FYI on the cash back thing, it's never as good of a deal as the travel is. So that's why I use these for travel. Anyway, I am a Marriott Bonvoy girl through and through and through. And when I was looking at credit cards, I picked the credit card because they have partnership with Marriott, and I knew I would always be able to transfer points, and that's one of my biggest hacks.
Amber F. (12:36)
We're going to get to that in a second. But anyway, when you're figuring out what to get for you, setting some goals and expectations is going to be really good because the whole point of using these credit cards is not to increase your spending. It's not to change your spending habits. It's to just make sure that you funnel everything that's on your budget through your credit card. You shouldn't change any of your habits or make any big purchases or change anything that you're doing. All you should be doing is just using your credit card as if it were cash. Meaning if you do not have the money in the bank, you cannot afford it. That's how I run my life, and I've been super successful in milking the hell out of these travel rewards, and I'm going to tell you how I did it. Okay, so a couple of reasons why I think this is so important as well as we're talking about debit cards versus credit cards too, is because there's so much more protection on a credit card and so many bonuses that you get that you're not paying for. Again, like I said, the cost to entry might feel like, $550, that's a lot.
Amber F. (13:36)
But when you think about the types of protections that you get, it's beyond. So first and foremost, you're going to get usually some credit screening, credit monitoring. I have a identity theft monitoring, and all of that is free, and that's actually really helped me. My card has been hacked a couple of times and my business is pretty public. So that's something that I really rely heavily on. So that's number one thing, you get the protection of your identity and your credit. As I mentioned before, if you get compromised through your debit card, it's often very hard to recover the money because that's cash lost right away that has to be replaced versus a credit card transaction that happens. It happens in the cloud without an exchange of cash changing hands, right? So often you get a little bit more protection just with the buffer of time with credit cards. Another thing is that you get a lot of additional insurances with credit cards. Now, I hate paying for insurance, so I'd love to have it included in the things that I'm already doing. So, for example, cell phones are actually covered on my credit card for insurance.
Amber F. (14:41)
So if anything happens to my cell phone, Chase will help me get reimbursed to buy a new cell phone in case there's an emergency. And for somebody like myself who runs her business on her phone, I can't have a minute without my cell phone. So that's super important. And then I also don't have to pay extra for Apple Care or also to Verizon, they do those monthly charges. It's already covered because I paid for my phone with this credit card. Also, you get access to travel insurance. So when you get a rental car, if you've had issues with travel because of sickness, flight, weather changes, whatever, travel insurance comes in really helpful. And I have exercised this. We did this in Tulum when shit went off the rails and we needed to get home. Our travel insurance kicked in and they rebooked all of our flights at no cost. It was incredibly helpful. The other thing is that with travel, you also get the protection of... Well, I wouldn't say protection, but you also get the benefit of no foreign transaction fees on a lot of these travel credit cards. So you might not know this, but travel to Mexico, for example, and you're using your debit card to spend everywhere, they're going to take your money, but they're also going to charge you a fee for doing so.
Amber F.(15:46)
So I love that the travel portion of it's all taken care of. And then even better than that, a lot of these credit cards have travel credits. So, for example, the Chase, Sapphire Reserve, which is the card that I have, they give you a $300 travel credit where you can literally just reimburse a travel expenditure. Plus, they'll reimburse you for a global entry or TSA pre-check up to $100 every four years. I love that right then and there that's covering my annual fee. My annual fee is $450. I'm getting $300 back, plus $100 on that year that I'm getting reimbursed for redoing my TSA pre-check. And if you're a traveler and you use TSA pre-check, you know how much of a bonus that is to get into the country and fly by with global entry. That's worth its weight in gold. I cannot put a price tag on getting the F home once you land back in America. Are you with me? The other thing is that you get complementary airport lounge access with a lot of these credit cards. I talked about this on a couple of episodes ago. We talked about Tom braided coming in and being the advisor for Delta Airlines.
Amber F. (16:54)
Well, the Delta CEO, sweet old man, came out and said, Oopsies, we totally screwed up. And he actually talked about it in more detail in the fact of what happened and why they made those changes so drastically, essentially because they had allowed people to roll over their credit points or their... What is it? Mqds, MQLs, MQ, whatever. Their mileage, qualifying legs, trips, miles, whatever. And so they basically had an excess of people that were qualified for all of these different benefits, and they just didn't have the capacity to serve them all. But as I said, the CEO came back and said that the customer feedback was a gift and they're going to make some adjustments that are not so intense. But as we talked about one of the biggest cohorts of people that were upset by this were the American Express card holders who actually usually buy the card because they want to get into the centurion lounges. And a lot of Delta card holders actually were losing access as well on a regular basis. And think about that. If you're a business traveler, if you're always in the airport and all of a sudden they're going to limit you, people were up in arms.
Amber F. (17:56)
They were saying, I am changing airline companies. I am ditching this credit card. Card. And as I mentioned, Delta Airlines is a credit card company that also has airplanes. They make so much money on the credit card business that they would be stupid to mess it up that badly. So sorry, Tom Brady, but there's a new sheriff in town. We've talked about cell phone insurance, travel insurance. You've got a credit monitoring, identity theft management system. You've got identity theft coverage. You get access to airport lounge. You can get reimbursed for global entry, TSA. You can get travel credits on some of these cards. You can also get additional partnership benefits. I'm going to come back to that. And then with some of these other cards, you have access to early ticket releases like Capital One did their ticket release with Taylor Swift this year. So that was a brand partnership. And it's hard to plan for those and know what's going to happen. But American Express obviously is really well-known for their concierge to get you into different deals, shows, sporting events, et cetera. So if those types of things are of value to you and you want to be there, go do it.
Amber F. (19:01)
Just don't overspend and overstretch to be able to do it, right? So you're probably like, great, you're dropping all these card names. Actually, I'm really only talking about Chase, but that's because that's what I use right now. And you're wondering, how do I pick a card? Like what's the right card? And the right card for you is going to be dependent on what your goals are that you set up, right? And one of the things that I would recommend you do is go to nerdwallet. Com, which is actually a really helpful site that breaks down all of the pros and cons of all of these different cards. It'll tell you the benefits of all the different Chase cards, Discover Cards, Balance transfer, et cetera, et cetera. And if I look at the best credit cards for September 2023, for example, it's giving me their rating. So it's giving me like a Wells Fargo active cash card with the best offer? No, no, no, no, no. I'm going to tell you how to navigate the site and how to pick the best card for you. You're going to go to the best rewards credit card's page, depending on if you're travel or general or whatever, and you're going to look at two things.
Amber F. (20:02)
Number one, the annual fee, and number two, the intro offer. I did not mention APR. I do not care about the APR. The APR does not matter to me because I never, ever, ever pay interest. So it could be 50 %, but I'm not going to pay interest on this card. That's my self-control, my discipline to ensure that that happens. And so APR to me doesn't really matter. I'm looking at this as a way to get benefits back. So the annual fee is what I'm looking at first, and I'm going to determine what's the ROI on this annual fee. For example, if I'm paying a $95 fee, will I get more than $95 of benefits back from this card on money I would have spent otherwise? For example, with the Chase card, my fee is $450 a year. This one says $550, maybe it is $550. So when I did this, I was like, okay, well, right away I'm getting the $300 annual travel credit. Secondarily, I'm going to be getting global entry and pre-check. And I know my monthly budget, and I did the math of, okay, if I spend this much money per month on my credit card a year, this is how many points I could expect to get, and the value of those points is more than $550.
Amber F. (21:10)
So it's a win-win for me, right? So if you're going to be using the benefits, the cost to entry can actually get you a lot more for free. So you do need to think about that when I'm saying, for example, I'm going on vacation for free. Is it really for free? Well, at the end of the day, it all comes out in the wash. And if let's say I'm taking this trip at the end of next month, which the value of it is $5,500 and I'm paying $550 in my annual fees. Yeah, I'm pretty cool with taking a free $4,900 trip, whatever the cost is. It's still a lot of good money. And it's again, me not spending above my means, it's me spending within my budget. The other thing that I mentioned is the intro offer. And this is the key. Do not get hooked by a $300 intro offer or anything like that, what you want to get is a mileage bonus points, okay? So the intro offer is usually something like spend $8,000 in six months and get 100,000 miles or spend $4,000 in three months and get 75,000 miles. And you don't want to think about it as like, okay, 75,000 miles is equal to about $750 in travel through the travel portal for that credit card.
Amber F. (22:24)
I don't care about that. That's not what I'm looking for. This 75,000 miles, this 100,000 miles that you're getting as a bonus, that's your nest egg. That is going to launch you into the stratosphere of playing a bigger points game. And this is really important. When you're evaluating an intro offer, you need to make sure that the intro offer criteria is not more than you would actually spend in a month already. So, for example, if they want you to spend $3,000 in three months in order to get 50,000 miles, are you already planning on spending $1,000 per month for the next three months? And does that criteria make sense for you? If you're overspending, I would wait until you're buying a couch and you've saved the cash for it, and then you put the couch on the credit card and pay it off right away. So you can still get that sign-up bonus and make it make sense. Another thing you're going to see on the site is the rewards rate and how fast you can get the points to add up for you. Now, I have a friend who I went out to lunch with her recently, and as we were paying or splitting the bill, she pulled out a post-it note.
Amber F. (23:26)
And this post-it note had a list of all the credit cards, it was from her husband and the different cards and where she was allowed to spend them. So one card she could spend on dining, one card she could spend on cash. One was for groceries because you would get the max points for all of them. So that is not my vibe. I am not that into it. I really respect the hustle on that, though. But for me, I like to just keep things simple. So I picked a card that's standard between two and five X times what I spend on points. And again, it's more about getting a nest egg, and I'm going to tell you why in just a second. But you can be really beginner and just run your expenses through here and take what you can get. You can be more advanced where you're signing up for new cards every couple of years and closing them out and starting over again. That's not great for you. If you carry a balance, you don't have a great credit score. Or you could do this psychotic trifecta-level program where you have three Chase cards and you do all the different bonus points for the different things.
Amber F. (24:25)
That's just not how I live my life. But I will say that I am big about maximizing my points. And the way that I do this is the thing that I don't see enough people talking about. I said it at the top of the show. If you are interested in getting credit cards, asking yourself, Where do I want to go? Who do I want to be? Where do I want to stay? And figuring out what those business partners are. Are you only a Delta girly? I told you I'm a Marriott Bonvoy girly. Everywhere we go, it's Marriott Bonvoy. Well, not everywhere. IHG Marriott Bonvoy, Hotels of the World. Anyway, Marriott is such a key. They have the W, the St. Regis. And you know what? You can also get additional points through using Uber, all these things. Let me just scoop back really quickly to random other benefit for credit cards nobody's ever talking about is like, I get free subscription fees to so much stuff. So I get free Instacart, I get free... Not free-free, but I get a credit every month. I have Uber credit, Instacart credit, DoorDash credit. Does that encourage me to spend it?
Amber F. (25:24)
No, sometimes I don't spend anything on DoorDash or Instacart in a month at all, but it's there if I need it. And if I don't use it, I lose it, whatever. But all these other little things, like they're adding up. So if that's something that's in your lifestyle, you should look into those benefits. Anyway, I digress. I was talking about maximizing the points. I told you I'm Marriott Bonvoy, girly. That's why I picked the Chase card because Chase and Marriott have a relationship, so you can transfer points between the two platforms. The other thing I see nobody talking about on the internet about credit card and why and how I've messed it up so badly before is do not book through the Chase portal. Do not book through American Express. You think it's a better deal? Number one, it's not. It's so much more expensive to book through the portal. Number two, it's a third-party provider. So when you book through Chase and you show up at the W in South Beach, they're like, Oh, great, you booked on Expedia. We're going to give you the shittiest room because it's at a discount. And you're like, I didn't book through Expedia, I booked on Chase.
Amber F. (26:25)
Well, all of a sudden now because you booked through the portal for your credit card company, it's been booked through a third party. So the place of which you go to, the hotel, the airline or whatever, it's seeing you as booking as a third party, and you're not going to get upgrades that way. You're not going to get any bonuses that way. What you need to do is find your partners and transfer the points to them. For example, I'm going on a trip in about a month. We're staying at a Marriott Bonvoy property, and I was waiting with baited breath. I was checking my Chase portal every freaking day because they were doing a bonus points offer. Where if you transferred your points from Chase to Marriott, you would get 50 % more points for free, you guys. I had 200,000 points in my Chase portal. I transferred them over to Marriott Bonvoy. And when I ended up at Marriott Bonvoy, I had 300,000 points. You guys, that is enough for two vacations, quite honestly. But we really went big on this one that we're going on coming up. And it's like half business, half pleasure.
Amber F. (27:28)
But because it's not all business, you can't make it a business expense. So just for the IRS, just know that I'm following the rules, okay? There's nothing shady here. I'm not going on tax evasion like Karen Huber, even though you got to make a million to be taxed a million, right? Anyway, my point is that I transferred it over. That is thousands of dollars for free that I just got because I transferred the points to Marriott. Then I booked through Marriott. Marriott sees me as a loyal customer. And then when we get there, more than likely, if there's an upgrade, it'll be something that's offered to us. It's not something that I have to pay for, it's something that's just going to be made available because I'm always doing these things through Mariot. So I have status with Marriott as well as with Chase, and all of my nights, days have added up and they see that I'm like a gold-level tier now. So I get better rates through them and I also get better benefits. So freaking huge. The other thing that I'll say as well is the same thing happens when you transfer points to airlines.
Amber F. (28:26)
Now, I'm pretty airline-agnostic. I don't really care about flights. I'm 5'3. I can fit in a standard size seat and I sleep anywhere. So I'm not one to spend a lot on travel. In fact, I flew to Japan and I literally did not get up for my seat for the entire flight. I slept through the entire thing. I don't know, traveling doesn't bother me in that way. But I know a lot of people who especially are taller, they need more room, they want to be comfortable, they need to have a lay flat bed or a business class or first class seat, using points to pay for it is going to be so much less expensive than paying out of pocket for those types of expenses when you transfer to your airline partner. And then you can again build status and loyalty and then earn those upgrades and get bonus from there. So that's my number one... Those are two tips. Number one, don't book through your credit card portal because they see you as a third party. Number two, transfer your points to your business partners of choice so that you can book directly through them and get bonus points added for free money.
Amber F.(29:31)
That is it for me. So a couple other things I'll say about maximizing points, we're going to talk so much about this. I truly in my heart of hearts believe that the future of this economy is small business, is freelancers, it's us owning our own futures. And there are so many benefits to starting a business on your own, and one of them is credit card points. That sounds silly, but it's so true. When I have my business card, it's my company, it's under me, it's incorporated to me. I'm the 100 % shareholder. And by the way, I'm bootstrap. I don't have any investors or anything like that. Everything that I've built has come from me. So these are my assets and the credit card points are part of my assets. You know that in a divorce you can argue over credit card points, and that is a forensic accounting nightmare. But for me, when I'm running our business expenses, I pay everything I can through my credit card. In fact, when I invoice my clients, we ask for them to pay us through ACH. But I have some clients who opt to pay a credit card fee in order for them to pay our business with their credit card, and they'll pay the extra fee on top of it because the points are so valuable to them.
Amber F. (30:41)
For me, I pay our insurance, I pay our rent, I pay all of our vendors that I can through credit cards. I pay absolutely everything for my business through credit card. And if you've ever run a business before you know that everything adds up and operating expenses are just going to always be there. So for me to be able to benefit from that on the back end is absolutely huge. So not only are there benefits to incorporating yourself as it relates to taxes, freedom of time, energy, income, also you get the credit card points out of it as well. So again, same rules apply. Don't overspend, don't go into debt. I will not allow us as a company to go into debt. I want to make sure that the company is healthy, my team gets paid, and I get the points. The other thing that I would say is you got to be really careful to not play the game too hard. Don't point sky too close to the sun and get burned. That was a bad analogy, but you know what I'm saying? Because I know some people who have a strategy to open two or three cards every single year.
Amber F. (31:42)
And if you have goals to buy a home or invest in businesses or do whatever you need to do that has to do with your credit score, those types of changes and fluctuations can actually harm your credit score if you don't monitor them properly. A better option instead of canceling everything is to downgrade cards to have them be no annual fees and then leave them open. Freeze them in a block of ice in your freezer, never touch them again, or just shut them down. But you need to make sure your credit utilization rate stays really low and that you don't freak out the credit card reporting companies by changing stuff all of the time. The other thing that I'll call out to just to go back to the business conversation of it all is that I never use points on business travel. Business travel is a business expense, and it's in my best interest to pay... I'm saying cash in quotes, but you can't see me if you're not watching the video. By the way, I'm recording this. People have been telling me they want video, which do they? Do you? Really? It's just me talking.
Amber F. (32:38)
I mean, anyway, if you want to watch video, you can watch video. Anyway, my point is that... What was I saying? Oh, yeah. Okay, business points. I never spend points on business travel because it's a business expense. And those points because they belong to me are things that I can use on my personal. So I'm benefiting using the business card for my personal points travel, but I'm not going to spend the points, the free money on a thing that's a business expense because there's tax advantages to spending business money. Does that make sense? I feel like I could have explained that better. So apologies there. Anyway, the other thing to note too is that although I can co-mingle my points, you should never co-mingle business and personal expenses. It's the fastest way to disaster in your business and your accountant will hate you. There's a whole bunch of financial institutions out there. There's a whole bunch of different companies and options. My best advice is to go slow and to not change your spending habits at all. One of the things that I did when I was starting this was I was monitoring very closely everything that I spent on my credit card with pen and paper just to make sure that I wasn't going overboard on things.
Amber F. (33:47)
I don't do that anymore at all. It's like when you learn how to eat proper portion sizes, right? Like if you go to the Cheesecake factory and they put all the brown bread in front of you, you're going to eat all the brown bread because it's so damn good. But after you know what a portion size is, you can eyeball a fist full of chicken and be like, okay, that's six ounces. My point is that once you get comfortable with your budget, it should be something that runs pretty naturally for you without being a big stressor. So to wrap it all up, I would love to know, what credit cards are you using? What benefits did I not talk about? Tell me the things that you love to learn about credit cards, the vacations you've taken, the savings you've made. I want to know it all. So in the meantime, if you have any questions, come see me on social at Old Money Podcast. It's me and Mel there. I want you guys to meet Mel. She's a member of AF marketing team and helping out on social and with programming for the podcast. I'm so excited to bring you some very exciting guests soon, and I will talk to you guys on the next episode.
Speaker 1 (34:43)
Bye-bye. Feeling rich? I hope so. Thank you for joining me on this episode of Old Money. If you have questions you want answered, email me at oldmoneypodcast@gmail. Com or hit us up on social. We are at Old Money Podcast and I am at your service. If this episode spoke to you, inspired you, helped you, if you took a single note, it would mean the world to me. If you could please just take a minute to write and review the podcast. And if you're not doing so already, subscribe. And if you have friends who like getting rich, please share this episode with them, even if it's just on your Instagram story. And I'd love you more than Jeff Bezos loves Amazon Prime. Thank you so much and I will talk to you on the next episode. Remember, I'm not your lawyer, I'm not your tax professional, and I'm not your financial advisor. The content presented in this podcast is intended to entertain, educate, inspire, and support listeners and their personal and professional development and does not constitute business, financial, or legal advice. In addition to that, this episode may contain paid endorsements and advertisements for products and services.
Sponsors
Today's episode is brought to you by Flodesk— design and send emails your subscribers actually want to get. Head to flodesk.com/c/oldmoney to get 50% off your first year today!
Connect with the Old Money Podcast:
© Old Money 2023.
The content presented in this podcast is intended to entertain, educate, inspire and support listeners in their personal and professional development and does not constitute business, financial, or legal advice. Please note that this episode may contain paid endorsements and advertisements for products and services for which individuals on the show may have a direct or indirect financial interest in products or services related to the episode.
Produced by AFMEDIA, a division of AFMKTG.
