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‎_posts/2024_02_05-DoD-credit-cards.md‎

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# Credit Cards for Military Service Members
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The audience for this is active duty military service members. Although many recommendations have nothing to do with
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military service, I would not recommend several of the below credit cards if the annual fee was not waived. I will
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attempt to keep this strictly about credit cards, however, some credit cards do require establishing a banking
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relationship as well.
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**If you have poor financial responsibility and would ever charge an amount to a credit card without the ability
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to pay off the credit card in full by its due date, do not apply for and use credit cards. Credit cards can be a
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phenomenal tool for building credit, receiving additional benefits, and receiving cash back on purchases you are already
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planning on making and can pay for in full but can also land you in serious debt that could take years to overcome.**
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### I'll start with answering a few credit card rumors:
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1) You should **never** carry a balance on your credit cards, it is not a way to improve your credit score.
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2) Having many credit cards does not mean you will have poor credit (the *number of open accounts* is a small factor
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relative to others when your credit score is calculated. *Credit inquiries* are a predominately temporary impact to
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your credit score. If you are anticipating taking out a loan, especially a mortgage, you should avoid necessary
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credit inquiries for several months prior to applying). I have close to 30 active credit cards and over an 800
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credit score across each credit bureaus.
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3) Paying with a credit card is *always* safer than paying with cash or a debit card due to the liability and
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fraud protection available.
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4) Even with some places charing more for credit compared to cash or debit, you can still "out-earn" the fee with some
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credit cards. For example, if a restaurant charges 2.5% for credit card users, but your credit card earns 4%
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cashback, you will still net 1.5% cashback by using your credit card.
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5) You can have multiple of the same credit card to maximize its perks. Sometimes this requires upgrading from a lower
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tier card, sometimes you can apply through a co-branded credit card.
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#### Before applying to a new credit card:
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1) Ask your coworkers for a referral; typically you both will benefit from a referral. There are **no** referral links
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in this post. Do not post referral links in comments, they will not be approved.
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2) Be cognisant of credit inquiries, credit card company
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[application restrictions](https://thepointsguy.com/credit-cards/credit-card-application-restrictions/), and timeline
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to achieve minimum spend bonus offers. You will not be able to apply for a high number of credit cards in a short
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time.
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3) Understand the credit card's benefits and have a plan for how you will use the credit card.
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4) Know which companies [waive annual fees](https://militarymoneymanual.com/credit-cards-waive-annual-fees-military/)
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for military.
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1) American Express
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2) Chase
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3) Citi
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4) U.S. Bank
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Personally, I value cash back over points because I can immediately treat them as monthly "rebates" on purchases. Even
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though you can redeem points for more than 1¢/ea, I generally value all points at 1¢ each because they typically require
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"saving" points over months or years to achieve higher redemption values (except PenFed which are valued at .75-85¢ each
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because redemption options are so poor) through transfer or travel portals. **I pay \$0 in annual fees for all of my
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credit cards.** Based on your monthly budget, identify your main purchase categories and see which credit cards will
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maximize your cashback or points. Generally, my recommendations are in order based on the top typical category most
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service members will have. I also do not highlight every card benefit available for each credit card, just the top
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benefits.
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## Maximizing Cashback and Points
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### Getting Started with an "Everything" Card
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At the very least, you should be getting a minimum of 2% cashback on all purchases with your credit card. There are many
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ways to earn higher than 2%, but many require additional steps. For example, with the
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[Bank of America Unlimited Cash Rewards](https://www.bankofamerica.com/credit-cards/products/unlimited-cash-back-credit-card/),
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you can earn 1.5% at baseline, however, if you have \$100,000 in a Merrill Lynch brokerage account you can earn a 75%
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bonus through [Preferred Rewards](https://promotions.bankofamerica.com/preferredrewards/en) resulting in 2.62% cashback
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on all purchases. The new [Robinhood Gold Card](https://robinhood.com/creditcard/) earns 3% cashback on all purchases,
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but requires a RobinHood Gold subscription (\$5/mo).
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1) [Citi Double Cash](https://wwww.citi.com/credit-cards/citi-double-cash-credit-card): 2% cashback
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2) [Wells Fargo Active Cash Card](https://creditcards.wellsfargo.com/active-cash-credit-card): 2% cashback
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### Restaurants
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1) [Chase Sapphire Reserve](https://creditcards.chase.com/rewards-credit-cards/sapphire/reserve): 3x points (50% bonus
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on all Chase points when redeemed through the Chase Travel Portal so effectively 4.5x points), \$300 travel credit.
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2) [American Express Gold Card](https://www.americanexpress.com/en-us/credit-cards/credit-intel/gold-card-rewards-points/):
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4x points on up to \$50,000/yr, 4x points on up to $25,000/yr on groceries, \$120 dining credit, \$10/mo Uber credit,
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\$100 Resy Credit, \$7/mo Dunkin' Donuts Credit
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### Online Purchases
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1) [Bank of America Customized Cash Rewards](https://www.bankofamerica.com/credit-cards/products/cash-back-credit-card/)
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3% on up to \$2500/quarter. Bank of
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America [Preferred Rewards](https://promotions.bankofamerica.com/preferredrewards/en) increases the cashback to 5.25%
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if you have \$100,000 in an IRA or brokerage in a Merrill Lynch account.
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2) [Chase Prime Visa](https://www.amazon.com/Prime-Visa/dp/BT00LN946S): 5% at Amazon
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3) [Amex Blue Cash Everyday](https://www.americanexpress.com/us/credit-cards/card/blue-cash-everyday/): 3% on up to
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\$6000/yr
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### Travel
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1) [American Express Platinum](https://www.americanexpress.com/us/credit-cards/card/platinum/): 5x points with airlines,
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Priority Pass Lounge access, Centurion Lounge access, \$200 airline credit
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2) [Chase Sapphire Reserve](https://creditcards.chase.com/rewards-credit-cards/sapphire/reserve): 5x points on airline
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purchases through Chase Travel portal, 50% point bonus (for all Chase cards) when redeemed for travel in the Chase
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Travel portal, Priority Pass, Chase Sapphire Reserve lounge access (note: if you have multiple credit cards with a
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Global Entry credit, you can use the other credits on other people)
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3) Airline Specific with Lounge Access (and other benefits):
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1) Delta:
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[Amex Delta SkyMiles Reserve](https://www.americanexpress.com/us/credit-cards/card/delta-skymiles-reserve-american-express-card/)
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and [Amex Delta SkyMiles Platinum](https://www.americanexpress.com/us/credit-cards/card/delta-skymiles-platinum-american-express-card).
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With both credit cards, you will get automatic Silver Status with the MQD Headstart on both Credit cards and two
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Companion passes each year.
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2) American:
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[Citi AAdvantage Executive World Elite](https://creditcards.aa.com/credit-cards/citi-executive-card-american-airlines-direct/)
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3) United:
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[Chase United Club Infinite](https://creditcards.chase.com/travel-credit-cards/united/club-infinite)
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4) Hotel Specific (free night(s)):
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1) Marriott:
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[Chase Marriott Bonvoy Bountiful](https://creditcards.chase.com/travel-credit-cards/marriott-bonvoy/bountiful)
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2) Hilton:
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[Amex Hilton Aspire Card](https://www.americanexpress.com/us/credit-cards/card/hilton-honors-aspire/)
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3) IHG:
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[Chase IHG Premier](https://creditcards.chase.com/a1/ihg/Premier12325NAEP)
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### Grocery Shopping
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1) [American Express Blue Cash Preferred Card](https://www.americanexpress.com/us/credit-cards/card/blue-cash-preferred/):
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6% cashback on up to \$6,000/yr, 6% cashback on select streaming subscriptions, 3% cashback on gas.
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2) [American Express Gold Card](https://www.americanexpress.com/en-us/credit-cards/credit-intel/gold-card-rewards-points/):
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4x points on up to \$25,000/yr, 4x points on up to $50,000/yr at restaurants, \$120 dining credit, \$10/mo Uber
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credit, \$100 Resy Credit, \$7/mo Dunkin' Donuts Credit
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### Gas
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1) [PenFed Platinum Rewards](https://www.penfed.org/credit-cards/platinum-rewards-visa): 5x points on gas and EV
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charging
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2) [American Express Blue Cash Preferred Card](https://www.americanexpress.com/us/credit-cards/card/blue-cash-preferred/):
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3% cashback, 6% cashback on up to \$6,000 in grocery store purchases, and 6% cashback on select streaming
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subscriptions.
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### Rotating Categories
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1) [Discover It](https://www.discover.com/credit-cards/cash-back/it-card.html): 5% cashback on quarterly category. These
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categories include grocery, Amazon/Target/Walmart, PayPal, restaurants, etc.
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2) [Chase Freedom Flex](https://creditcards.chase.com/cash-back-credit-cards/freedom/flex): 5x points (7.5x with
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Chase Sapphire Reserve) on quarterly category
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3) [Bank of America Customized Cash Rewards](https://www.bankofamerica.com/credit-cards/products/cash-back-credit-card/)
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3% on up to \$2500/quarter of your selected category (Gas/EV charging stations, dining, travel, drug stores and
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pharmacies, or home improvement). With preferred rewards, 5.25% cashback.
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## Advanced Credit Card Topics
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1) [Churning](https://thepointsguy.com/credit-cards/credit-card-churning/)
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and [manufactured spend](https://www.reddit.com/r/churning/wiki/manufactured_spending/)
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2) [Upgrading credit cards](https://thepointsguy.com/credit-cards/your-ultimate-guide-to-credit-card-upgrades/) to
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maximize sign-up bonuses on lower tier cards, but receiving multiple benefits of higher tier cards.
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3) Maximizing [sign up bonuses](https://thepointsguy.com/credit-cards/limited-time-card-offers/)
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4) [Point breakdowns](https://thepointsguy.com/credit-cards/best/)
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## What's in my wallet
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| Credit Card | Benefits Utilized | Carried or Drawer* |
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|----------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------|
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| [Bank of America Unlimited Cash Rewards](https://www.bankofamerica.com/credit-cards/products/unlimited-cash-back-credit-card/) | 2.62% cashback on all purchases | carried |
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| [Bank of America Customized Cash Rewards](https://www.bankofamerica.com/credit-cards/products/cash-back-credit-card/) | 5.25% cashback on online shopping | drawer |
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| Citi Prestige | 5x points at restaurants, 3x at hotels, 3x transit, \$250 annual travel/restaurants, 4th night hotel free (2x/yr), \$100 global entry credit, cell phone protection (\$1,000/claim, \$1,500/yr, \$50 deductible), Priority Pass Select membership, 24 months extended warranty | carried |
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| [PenFed Platinum Rewards](https://www.penfed.org/credit-cards/platinum-rewards-visa) | 5x points on gas | carried |
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| [American Express Platinum](https://www.americanexpress.com/us/credit-cards/card/platinum/) | 5x points on air travel, \$200 airline credit, \$20/mo digital entertainment credit, \$100 global entry credit, \$200 hotel credit, \$100 Saks credit, \$15/mo Uber credit, Walmart+ credit | drawer |
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| [American Express Blue Cash Preferred Card](https://www.americanexpress.com/us/credit-cards/card/blue-cash-preferred/) | 6% cashback on groceries (on up to $6,000/yr), 6% cashback on select streaming subscriptions (including Apple subscriptions and gift card purchase through your Apple Account) | carried |
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| [American Express Delta Reserve](https://www.americanexpress.com/us/credit-cards/card/delta-skymiles-reserve-american-express-card/) | \$2,500 MQD head start, \$10/mo rideshare credit, \$20/mo at Resy restaurants, \$200 Delta Stays Credit, Hertz President's Circle Status, Companion Certificate, TakeOff 15, | drawer |
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| [American Express Delta Platinum](https://www.americanexpress.com/us/credit-cards/card/delta-skymiles-platinum-american-express-card/) | \$2,500 MQD head start (automatic Silver status combined with the Delta Reserve), \$10/mo rideshare credit, \$10/mo at Resy restaurants, \$150 Delta Stays Credit, | drawer |
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| [Discover It](https://www.discover.com/credit-cards/cash-back/it-card.html) | 5% cashback on rotational category | carried depending on quarter |
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| [Chase Freedom Flex](https://creditcards.chase.com/cash-back-credit-cards/freedom/flex) | 5x points on rotational category | carried depending on quarter |
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*Drawer card means I only charge purchases to them for the benefit (and they typically stay in my drawer).
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I pay \$0 in annual fees, these are just the cards I regularly use and the primary benefits utilized with each card.
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## Next cards I'll be applying for
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1) [Robinhood Gold Card](https://robinhood.com/creditcard/), 3% cashback on everything
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If you have any recommendations or updates to anything in the post, feel free to leave a comment!

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