When news of the limited time 60K Chase Ink bonus hit, I decided to apply (it expires June 1st, btw). I figured $5000 would be pretty easy to clear so I wanted to apply for a second card. But what to apply for? The answer might surprise you…
The Fidelity Investment Rewards American Express Card
Believe it or not, I decided to get a cash back card. Specifically, I applied for the Fidelity Investment Rewards American Express card, which currently has a paltry sign up bonus of $75 after $500 in spending. Before I get into why I decided to get a cash back card, let me explain the benefits of this card.
The great thing about this card is you get 2% cash back on everything with no limits. That means you get 2% all day every day and you never max that out. In terms of everyday spending, the only card that compares is the Barclay’s Arrival Plus, but that card comes with an $89 annual fee. The Fidelity AMEX has no annual fee. So all in all it’s a pretty good card. The only drawback is you need a Fidelity account (investment or cash management), though the cash management account is useful and personally I use Fidelity as my investment account.
Why cash back over airline miles?
So, why’d I choose a choose back card over another mile or points card? Well, there are a couple of reasons. First of all, due to us being a three person family now, we aren’t going to get to travel as much. We have more than enough miles and points for any travel we want to do for the next year or so, so we didn’t really need any airline points or miles.
Secondly, thanks to the Barclay’s Arrival Plus card, I’ve started thinking about earning points for domestic travel, which basically means using points as cash. Well, there isn’t a big difference between earning points that are redeemed for travel at 1 cent per point and earning cash back straight up. So I’ve started thinking about cash and miles as an overall portfolio (like investments). I’ll still earn airline miles for one of our travel goals – international travel in premium classes. But cash back/Thank You points/Arrival miles can be used for domestic travel equally, so I’ll lump all those types of miles/points/cash together.
Third, since the Fidelity AMEX doesn’t have an annual fee, I’m going to cancel my Arrival Plus card and just use the Fidelity AMEX instead. Yes, you earn a little more on Arrival Plus, 2.2% (thanks to the 10% rebate), but to make up for the $89 fee you need to spend a ton of money (the break even point between the two cards is $45K). So instead of keeping the Arrival Plus card, I’ll just cancel when the annual fee hits and earn 2% on the Fidelity AMEX. I can use that to pay for domestic travel just like I would have with the Barclay’s Arrival card.
Final Thoughts
I’ve come around on the benefits of cash back. 1% isn’t enough to entice me, but the 2% on everything that the Fidelity AMEX offers is too good to pass up. Whenever I’m not clearing sign up bonuses, I think I’ll be using this card (in the absence of any other category bonuses). 2% is pretty much unbeatable!
but you going to run into a problem that some places dont take Amex while Master Card is everywhere.
Yeah when that’s the case I’ll just default to one of my Chase cards. Just can’t justify the annual fee on Barclays
Hi Joe! Thanks for the link. Did we meet in Charlotte?
No, unfortunately by the time I found out about you guys it was sold out! Love your stuff though
Thanks for this post. I will likely do the same thing when my Barclays annual fee comes around.