If you’re like many Americans, you may carry thousands of dollars of credit card debt. One recent analysis found that the average citizen has $7,951 in debt. While getting out from under debt may seem daunting, there are ways to make it manageable.
Here’s a look at different strategies for paying off a large chunk of debt; specifically, $10,000. In addition to tactics for eliminating debt, you’ll learn why doing so is important, which can help boost your motivation.
Why Paying off Credit Card Debt is Important
In an ideal world, you would pay off your credit card every month in full. If you’re able to do that, using a credit card (responsibly) can be a good thing. It’s actually a pretty useful way to build credit and gain credit card rewards.
However, when you start to carry monthly credit card debt, things can get a bit dicey, because you’ll start to pay interest.
When you signed up for your credit card, you probably noticed that it came with an annual percentage rate (APR). The APR includes not only the approximate percentage of interest that you’ll likely pay on your credit card balance, but also fees associated with your credit card, such as origination fees or balance transfer fees.
Even if you make minimum payments, interest will still accrue on the balance you owe. The more money you owe, the quicker your interest payments can add up and the harder your debt can be to pay off. The fact that credit cards typically charge high interest rates (the current average interest rate is almost 25% at the end of 2023) is part of what you’re grappling with.
So strategies that help you pay down debt as fast as you can also might help you control your interest rates. That, in turn, can help keep your debt from getting ahead of you.
To illustrate some of the debt-demolishing tips in this article, the nice round number of $10,000 is being used. But everyone’s debt totals will be different, and the right ways to pay down debt will be different for everyone as well. It’s up to you to find the path that’s best for your needs. 💡 Quick Tip: Some personal loan lenders can release your funds as quickly as the same day your loan is approved.
[embedded content]
Avoiding Adding to Your Debt
If tackling $10,000 in credit card debt, or really any amount of credit card debt, the very first step might be to stop using credit cards altogether. This can be tough, especially if you’re used to using them all the time. But if you keep spending on your card, you’ll be adding to your debt. While you get your debt under control, you could consider switching over to only using cash or your debit card.
Building a Budget
Making a budget may help you find extra cash to help you pay down your credit cards. You can start by making a list of all your necessary expenses, including housing, utilities, transportation, insurance, and groceries.
It’s usually a good idea to include minimum credit card payments in this category as well, since making minimum payments can at least keep you from having to pay additional penalties and fees on top of your credit card balance and interest payments.
You can tally up the cost of your necessary expenses and subtract the total from your income. What’s left is the money available for discretionary spending, or in other words, the money you’d use for savings, eating out, entertainment, etc. Look for discretionary expenses you can cut — you might forgo a vacation or start cooking more — so you can direct extra money to paying down your credit card.
Consider using any extra windfalls — such as a bonus at work, a tax refund, or a cash birthday gift — to help you pay down your debt as well.
Though it may seem frustrating to cut out activities you enjoy doing, it can be helpful to remember that these cuts are likely temporary. As soon as you pay off your cards, you can add reasonable discretionary expenditures back into your budget.
The Debt Avalanche Method
Once you’ve identified the money you’ll use to pay off your cards, there are a couple of strategies that may be worth considering to help organize your payments. If you have multiple credit cards that each carry a balance, you could consider the debt avalanche method. The first step when using this strategy is to order your credit card debts from the highest interest rate to the lowest.
From there, you’d make minimum payments on all of your cards to avoid additional penalties and fees. Then, you could direct extra payments to the card with the highest interest rates first. When that card is paid off, you’d focus on the next highest card and so on until you’d paid off all of your debt.
The idea here is that higher interest rates end up costing you more money over the long run, so clearing the highest rates saves you cash and accelerates your ability to pay off your other debts.
The Debt Snowball Method
Another strategy potentially worth considering if you have multiple credit cards is the snowball method. With this method, you’d order your debts from smallest to largest balance. You would then make minimum payments on all of your cards here as well, but direct any extra payments to paying off the smallest balance first.
Once that’s done, you’d move on to the card with the next lowest balance, continuing this process until you have all of your cards paid off. By paying off your smallest debt you get an immediate win. Ideally, this small win would help you build momentum and stay motivated to keep going.
The drawback of this method is you continue making interest payments on your highest rate loans. So you may actually end up spending more money on interest using this method than you would using the avalanche method.
Only you know what type of motivation works best for you. If the sense of accomplishment you feel from paying off your small balances will help inspire you to actually pay your debt off, then this method may be the right choice for you.
Consolidate Your Debt
Interest rates on credit cards can be hefty to say the least. Personal loans can help you rein in your credit card debt by consolidating it with a potentially lower interest rate. With a personal loan, you can consolidate all of your credit cards into one loan, instead of managing multiple credit card payments.
Once you’ve used your personal loan to consolidate your credit card debt, you’ll still be responsible for paying off the loan. However, you’ll no longer have to juggle multiple debts. And hopefully, with a lower interest rate and shorter term, you’ll actually be able to pay your debt off faster.
Paying Off Credit Card Debt With a Personal Loan
If you think a personal loan could be a good way for you to pay off $10,000 of credit card debt, see what SoFi offers.
Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. Checking your rate takes just a minute.
SoFi’s Personal Loan was named NerdWallet’s 2023 winner for Best Online Personal Loan overall.
SoFi Loan Products SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Inside: Are you looking to maximize your rewards and credit card hacks? This guide will teach you the most effective methods for using your hacking, signing up for bonus rewards, and making efficient card purchases.
Credit card use extends beyond just making purchases. Savvy credit card users understand that with the right set of hacks and optimal usage, there’s a world of rewards that are ripe for the picking.
Money saved can be money earned, and this simple philosophy forms the cornerstone of these 25 credit card hacks you’ll be learning about today.
Why do credit card hacks matter? Well, I just received a $700 check for credit card rewards. That is enough to pay for a weekend trip away.
What are Credit Card Hacks?
Credit card hacks are creative strategies employed by credit card users to maximize the benefits and rewards offered by their credit cards while also potentially saving more money.
This trend has become more popular in recent years due to the rise in premium travel and cashback cards that offer lucrative ongoing rewards programs. Users who learn about these hacks can save you money on travel or just put cold hard cash back in your wallet.
With strategic approaches, these hacks provide an avenue to optimize rewards and navigate the financial landscape more effectively.
Proven Credit Card Hacks to Maximize Rewards
Tip #1 – Utilize sign-up bonuses
One of the most attractive features of credit cards is the sign-up bonuses they offer, which are essentially rewards that cardholders can earn after meeting a certain spending threshold within a specified timeframe. The bonuses can range from hundreds to even thousands of points, miles, or cash – favorably impacting your rewards balance.
To illustrate, if you take the Chase Sapphire Preferred® credit card, both partners in a household can get up to 50,000 extra points each as part of the sign-up bonus.
Bonus tip: Stagger your applications, so once one person gets the bonus after meeting the spending requirement, the other person can then apply and achieve the next round of bonuses.
Tip #2 – Increase credit limit
The principle behind this is simply buffering your “credit utilization ratio”, which is how much of your total available credit you are utilizing.
To illustrate how a credit limit increase will work, let’s consider an example: with a credit limit of $10,000 and a credit usage of $3,000, your utilization ratio stands at 30%. But once your credit limit increases to $15,000 with the same credit usage, your utilization ratio drops to 20% – which is a noticeable improvement.
Remember, when requesting a credit limit increase, some card issuers might execute a hard inquiry on your credit report, which could temporarily decrease your score. Hence, you should try to find out beforehand whether your issuer is likely to perform a hard or soft credit pull. Soft inquiries won’t affect your credit score, making them the preferable approach.
Tip #3 – Master balance transfers
A balance transfer, executed proficiently, can be an effective way to handle significant credit card debt. By focusing on reducing the cost of debt through lower interest rates, balance transfer can accelerate your debt repayment process while saving you considerable money over time.
This is what one of my clients did and the date when the 0% interest ended was very motivating to pay off their debt.
This process entails the shuffling of debt from one card (usually one with a high interest rate) to another card—preferably with a 0% promotional APR offer. With this interest-free period, you can focus on repaying the principal balance, hence clearing your debt faster.
As a finance expert, make sure balance transfers are only beneficial if you’re mindful of the terms, like how long your 0% rate will last and what fees are involved in the transfer to the new card.
Tip #4 – Purchase prepaid cards with credit
Need a way to spend a certain dollar amount by a certain deadline? Then, look at purchasing prepaid cards with a credit card as a strategy to earn extra rewards points. This method entails buying prepaid cards or gift cards using your credit card, and later using these prepaid cards to cover those expenses you typically will use.
In other cases, customers have reported that their credit card companies have clawed back rewards points that were initially given for gift card purchases. Double check their terms and conditions, many issuers, including American Express, explicitly exclude such transactions from earning rewards. 1
Tip #5 – Harnessing the 15/3 Methodology
The 15/3 Methodology is a credit card hack that intends to optimize your credit utilization ratio—one of the significant factors that impact your credit score.
Here’s how it works: You pay off a majority of your card’s balance 15 days before your statement date, and then pay off the remaining balance three days before the statement date. By doing this, you create the illusion of a lower balance, which can positively impact your credit score.
There is still a debate about whether or not this strategy improves your credit card score. Paying your bill on time will definitely improve your score.
Tip #6 – Strategies to earn additional rewards through third-party programs
An often overlooked but highly effective credit card hack is utilizing third-party apps and websites that offer additional rewards when you shop at participating retailers and restaurants. These rewards are additional to the cash back, miles, or points awarded by your credit card.
One such app is Dosh, a cashback app. By linking your credit card to your Dosh account, you can earn up to 10% cash back from participating retailers on top of the rewards earned from your credit card. Similarly, apps like Drop and Bumped give users points for every dollar spent, and these points can be redeemed for gift cards.
Furthermore, many airlines and hotels participate in dining rewards programs where you’ll earn extra rewards at select restaurants. Airlines like United, Southwest, Delta, and hospitality giant companies like Marriott and Hilton actively participate in such programs.
Tip #7 – Earn a credit card sign-up bonus then canceling the card right away
Also known as credit card flipping or churning, the tactic of earning a credit card sign-up bonus and then canceling the card right away has been employed by some savvy credit card users to maximize rewards.
However, this practice isn’t as easy or beneficial as it appears. While it sounds like an accessible system to generate easy money, it comes with several potential pitfalls that could make it a risky move.
Firstly, numerous card issuers have, over the years, implemented stricter rules to deter this practice. Chase, for instance, has the 5/24 rule indicating you can have only five new credit cards within the last 24 months. 2
Repeatedly opening and closing the same card can result in a declined application or rescinded bonus and hurt your credit score-perceived as credit misbehavior by the issuer.
It can also be viewed as unethical and potentially lead to you being barred from opening accounts with that issuer in the future.
Churning can negatively affect your ability to get approved for future credit cards and loans because lenders may think you’re a risky borrower.”
Tip #8 – Develop a multi-card system
This method aims to cover all your spending by using different cards that offer elevated rewards for certain purchase categories.
For instance, we have one card that pays an unlimited flat rate of 2% on all purchases. Then, another rewards card offering increased category rewards, with travel and gas. Then a there card that rotates through various categories each quarter.
Diversifying your spending amongst several credit cards can help you to earn the maximum possible rewards. However, endowing yourself with several credit cards is not for everyone as it requires careful financial management. In some cases, the potential of overspending can outweigh the benefits.
Tip #9 – Transfer points between multiple cards
Transferring points between cards (provided they are from the same issuer) is another useful strategy whereby you can redeem them at their maximum possible value.
The goal is to make your spending work for you and maximize the rewards you can earn from daily expenses. However, people should employ this strategy responsibly and ensure they’re not overspending just to earn rewards.
In such a strategy, points on traditional cashback cards can be transferred to airline and hotel partners when you also have a transferable points card like the Sapphire Reserve or Sapphire Preferred. So, not only are you earning cashback on your purchases, but you’re also accumulating lucrative points that can be redeemed for travel.
Tip #10 – Don’t use cash
In the world of credit card rewards, cash is no longer king. Whenever feasible, you should consider using your credit cards instead of cash or debit to pay for everyday purchases. This allows you to earn rewards on purchases you’re making anyway.
The best way to implement this is for you to bills with their credit cards instead of cash or debit and set this up on autopay. This serves a dual purpose of potentially earning rewards on these payments whilst also conveying a positive message to the banks about your money management skills, leading to possible credit score improvements.
However, this method works best when your spending doesn’t increase as a result. Only use your credit card for expenses that you’d normally pay in cash and for which you already have the money set aside to pay.
Tip #11: Time your purchasing
Being strategic about when you make your credit card purchases can help you wring out some extra benefits.
One way to optimize your earning potential and maintain a healthy credit score is to plan your large purchases around your credit card’s billing cycle. Making your most significant purchases immediately after your statement date ensures that you have the longest possible repayment period, effectively offering you a short-term, interest-free loan.
Furthermore, if your issuer has a rewards cut-off at the end of a calendar year, you can make larger purchases ahead of time to push yourself into a higher rewards bracket.
Tip #12 – Make Micropayments
Rather than making one full payment, consider making multiple payments over the billing cycle, commonly referred to as ‘micropayments.’ This helps keep your running balance low and, in turn, your credit utilization ratio – the percentage of your available credit limit you’re using – also low, positively impacting your credit score.
Plus it helps to keep your checking account at a more accurate level.
Tip #13: Have your spouse apply for the same credit card
Known informally as the “two-player mode” amongst credit card hacking enthusiasts, having your spouse or partner apply for the same credit card can be an effective strategy to earn double the sign-up bonus. This approach is based on the idea that instead of just adding your spouse or partner as an authorized user to your card, they should apply separately.
For instance, if a card like the Chase Sapphire Preferred® offers a 50,000 points bonus on sign-up, both partners can potentially earn up to 100,000 points collectively, essentially doubling the bonus.
But remember, this hack should be used strategically – you should stagger your card applications and ensure each of you fulfills the spending criteria to qualify for the bonus.
Tip #14 – Importance of prompt payment
Quite possibly the hack with the most significant impact on both your credit score and your pocket, prompt payment of your credit card bill cannot be overstated.
Making on-time payments can drastically improve your credit score since your payment history is the most heavily-weighted factor that credit scoring models consider.
Plus paying your balance in full each month can help you avoid interest charges and penalties, effectively saving you money in the long run.
Tip #15 – Know What Rewards you Want
Rewards such as travel miles, discounts at partnered retailers, cashback, or access to premium experiences like airport lounges or concert tickets are available, depending on your card.
By understanding and leveraging these varied rewards, you can get the most excellent value out of your credit card expenses.
Cautionary Advice on Credit Card Hacks
While credit card hacks can undoubtedly offer substantial benefits when done right, pitfalls can ensue if one isn’t careful.
Pitfall #1 – Overspending
For starters, these hacks can inadvertently lead to overspending or unnecessary purchases. Be wary of making purchases you don’t need or can’t afford in an attempt to earn more rewards or meet the spend necessary for a sign-up bonus.
Consequently, the pursuit of credit card rewards could also lead to accumulated debt if you’re not diligent about paying off your balance in full each month. The interest that you need to pay on balances carried over can easily eat up the value of any rewards earned.
Pitfall #2 – Impact on your Credit Score
Applying for multiple cards can lead to hard inquiries on your credit report, which can temporarily lower your credit score. Similarly, canceling cards after acquiring the sign-up bonus could harm your credit utilization ratio and your length of credit history, both key factors in your credit score calculation.
Additionally, irresponsible habits like ‘credit card churning’ and ‘paying for everything with credit’ may risk your relationship with card issuers. Some companies might close accounts or even ban individuals from opening new ones if they’re perceived as abusing the system.
While some of the top-tier reward and travel credit cards often come with hefty annual fees, not all of them are worth paying. This is especially true when a card’s annual fees outstrip the value of the rewards earned.
Before you sign up for a credit card with an annual fee, it’s advised to read the fine print and estimate what you can earn from it. You should evaluate whether the perks, bonuses, rewards, and credits offered offset the annual fee cost.
Personally, I don’t use any cards that have an annual fee.
Pitfall #4 – Paying interest
Credit card interest can significantly impact your overall financial health if you’re not careful. The money invested toward paying it off could be better used elsewhere – for saving, investing, or spending on your needs and desires. Hence, one of the best “credit card hacks” out there is to simply stop paying interest.
You want to focus on debt free living.
Pitfall #5 – Avoiding counterproductive habits like “balance surfing”
Balance surfing is a strategy where you continually move credit card debt from one card with an ending 0% APR promotion to another card with a new 0% APR offer. While this approach can potentially delay interest payments, it can become a dangerous cycle if you find yourself simply transferring debt instead of reducing it.
Meanwhile, the total debt remains the same. Without a consistent debt repayment strategy, this method can lead to an endless cycle of balance surfing.
What are some of the best credit card rewards and hacks for 2024?
As we venture into the new year, some credit card reward strategies remain timeless while others evolve in response to new credit card offers and updated reward programs. In 2024, here are some of the best credit card hacks worth considering:
Take Advantage of Updated Card Offers: Credit card issuers frequently update their card offers and rewards programs. Ensure you stay updated on these changes to maximize your card benefits.
Focus on Cards with Flexible Reward Categories: Some cards, like the Bank of America® Customized Cash Rewards credit card, allow you to choose your highest cash-back category (like online shopping, dining, or grocery stores). These flexible category cards can be more advantageous as you can adapt them to your spending habits.
Leverage Rotating Categories: Cards like the Chase Freedom Flex℠ and Discover it® Cash Back offer 5% cash back on up to $1,500 in purchases in various categories that rotate each quarter, once you activate. Plan your spending in advance to leverage these rotating categories optimally.
Remain Alert on Loyalty Program Partnerships: Many credit cards and airlines have partnerships with other brands. This can mean increased rewards when shopping with those brands, so always watch for new partnerships or promotions.
Revisiting Annual Fees: If your credit card perks no longer justify its annual fee due to changes in lifestyle or spending habits, consider downgrading to a no-fee card from the same issuer. This way, you can save on annual fees without closing your account which could potentially harm your credit score.
Diversify Your Rewards: While it may be tempting to concentrate all your spending on a single card, diversifying your rewards can make you earn more. Consider employing a multi-card system to maximize rewards across different spending categories.
Your credit card should be a tool to enhance your financial flexibility, not a burden that leads to financial stress.
Frequently Asked Questions (FAQs)
Deciding whether to focus on paying off a single card or distributing payments over several cards can seem complicated, but there are a couple of methodologies to strategize your payoff.
The Debt Avalanche method suggests focusing on the card with the highest interest rate first. Once you’ve paid this card off in its entirety, you then move on to the card with the next highest interest rate. This can potentially save you more money in the long term as it targets high-interest debt first.
Alternatively, the Debt Snowball method, proposed by financial guru Dave Ramsey, recommends paying off the card with the smallest balance first, then moving on to the card with the second-smallest balance. While you may not save as much money in interest compared to the debt avalanche method, the psychological motivation of paying off a credit card balance entirely may be more important for maintaining consistent repayment.
Either method requires you to make minimum payments promptly on all cards to avoid late fees and possible credit score damage.
Getting credit card points without spending any additional money may seem like wishful thinking, but there are certain strategies that you can employ to achieve this. Strategically managing your credit cards can turn your everyday spending into reward points, miles, or cash back.
Referral Bonuses: Many credit card companies offer referral bonuses to their existing cardholders who refer friends or family members. If the person you referred gets approved for the card, you can earn bonus points.
Cardholder Perks: Credit card companies often run promotions offering bonus points for certain activities. These can range from enrolling in paperless billing, adding authorized users to your account, or completing an online financial education course. Check with your card issuer to view any current promotions.
Shopping Portals: Many credit card issuers, and even airline and hotel rewards programs, have their own online shopping portals where you can earn additional bonus points for every dollar spent. If you were already planning on making an online purchase, consider making it through these portals to earn extra rewards.
Sign-up Bonuses: Some cards offer sizeable sign-up bonuses for new cardholders who meet a required minimum spend within the first few months. Although this technically requires spending money, it doesn’t require spending more money if you use your card for purchases you were already planning to make.
While implementing certain credit card strategies can potentially earn you higher rewards or save money, they can also unintentionally harm your credit score if not executed responsibly.
Several factors can contribute to this potential downfall:
Opening and Closing Accounts: A high frequency of card applications can lead to multiple hard inquiries on your credit report, which might lower your score in the short term. Closing credit cards, especially older ones, can affect both your credit utilization ratio and the age of your credit history, two significant factors in your credit score calculation.
Carrying a Balance: Maintaining a high credit utilization ratio—i.e., carrying a large balance relative to your credit limit—can negatively impact your credit score.
Late Payments: If these deadlines are not strictly adhered to, they could result in late payments, which can seriously harm your credit score.
Excessive Spending: Some tactics lead to unnecessary spending to earn more reward points or meet an initial spend required for a sign-up bonus. Not only can this increase your credit utilization ratio and potentially lower your credit score, it can lead to debt if these balances are not paid off in time.
While both rewards cards and travel rewards cards offer perks to their users in return for spending, the primary difference lies in the kind of rewards they offer and their target user base.
A Rewards Card generally offers cash back, points, or miles for every dollar spent, redeemable in a variety of ways. This is the type of card I prefer. For example, you may redeem your accumulated rewards as cash back into your account, use them to purchase products or services, or exchange them for gift cards. The flexibility of rewards makes these cards are suitable for people with varied spending habits and prefer a variety of redemption options.
A Travel Rewards Card, on the other hand, is designed specifically for frequent travelers. These cards earn you points or miles on specific travel-related expenses, like booking flights or hotel stays. The redeemed rewards are typically used towards further travel-related expenses like airfare, hotel stays, or car rentals. Travel Rewards Cards often offer additional travel-centric perks like free checked bags, priority boarding, airport lounge access, and more.
Consider your spending habits, lifestyle, travel frequency, and preference in terms of reward redemption.
Protecting yourself from credit card fraud is an important aspect of managing your credit card usage effectively.
Monitor Your Accounts Regularly: Keep a thorough watch on your credit card statements for any unauthorized or suspicious charges. Report them to your credit card issuer as soon as possible.
Use Secure Networks: When making online purchases, only shop on secure websites (look for “https” in the web address), and avoid using public Wi-Fi networks for transactions.
Keep Your Personal Information Safe: It’s important to dispose of old credit card statements properly, and avoid giving out credit card information over the phone unless you initiated the call and you trust the recipient.
Protect Your PIN and Password: Don’t share these with anyone, and avoid using easily guessable combinations like birth dates or the last four digits of your social security number.
Enable Account Alerts: Most banks now offer optional security alerts that can be sent via text message or email whenever a charge above a certain amount gets made to your account.
Protect Your Computer and Phone: Make sure your devices are equipped with up-to-date antivirus software and that your phone is locked with a secure password or fingerprint identification.
In case you become a victim of credit card fraud, know the steps to protect yourself – report it to your bank or credit card company immediately, file a report with the Federal Trade Commission, and report it to the three major credit bureaus, requesting them to put a fraud alert or a credit freeze on your account.
Also remember, credit cards don’t have routing numbers.
Making the Most of Credit Card Hacking
When used wisely, credit card hacks and reward strategies can play a significant role in stretching your budget and rewarding your spending. These secrets of savvy credit card use — from aligning your card to your spending habits, making the most of sign-up bonuses and reward categories, to understanding the ins and outs of your credit card’s rewards structure — can help maximize your potential rewards and save money.
Personally, we use all of our credit card rewards to pay for our travel expenses.
However, it’s paramount to remember that these tips and tactics should not encourage unnecessary spending or carrying a balance. Only spend within your means, ensure you pay off your balances each month to avoid interest charges and remember to safeguard your credit score by handling credit card applications and closures cautiously.
Ultimately, credit card hacks and rewards should fit within your overall financial plan and goals, adding value to your everyday spending habits and rewarding you for well-managed financial practices.
Remember your goal is to reach your FI number.
Source
Reddit. “American Express Clawing Back Points Earned From Gift Card Purchases.” https://www.reddit.com/r/AmexPlatinum/comments/14hywaq/american_express_clawing_back_points_earned_from/. Accessed January 19, 2024.
CNN. “What is the Chase 5/24 rule?” https://www.cnn.com/cnn-underscored/money/chase-5-24-rule#:~:text=The%205%2F24%20rule%20is,your%20approval%20odds%20with%20Chase. Accessed January 19, 2024.
Know someone else that needs this, too? Then, please share!!
Did the post resonate with you?
More importantly, did I answer the questions you have about this topic? Let me know in the comments if I can help in some other way!
Your comments are not just welcomed; they’re an integral part of our community. Let’s continue the conversation and explore how these ideas align with your journey towards Money Bliss.
Chubb is a property and casualty insurance company that operates in 54 countries and territories. Its executive offices are in France, Singapore, Switzerland, the United Kingdom and the United States.
Besides property and casualty insurance, the company also offers personal coverage and supplemental health insurance, life insurance and travel insurance. Chubb travel insurance is underwritten by ACE Property and Casualty Insurance Co.
What does Chubb travel insurance cover?
Depending on what type of coverage you’re looking for, Chubb offers several different travel insurance options. It offers annual policies as well as single-trip plans for trips to domestic and international destinations.
Coverage ranges across:
Chubb travel insurance plans
Three single-trip travel insurance plan options are available: Travel Basics Plus, Travel Essentials Plus and Travel Choice Plus.
These are comprehensive travel insurance plans that include medical coverage as well as trip protections, such as trip delay, baggage delay and baggage loss.
Here’s how coverage varies across the plans.
Travel Basics Plus
Travel Essentials Plus
Travel Choice Plus
Trip cancellation
100% of the trip cost (with a $100,000 limit).
100% of the trip cost (with a $100,000 limit).
100% of the trip cost (with a $100,000 limit).
Trip interruption
100% of the trip cost (with a $100,000 limit).
150% of the trip cost (with a $150,000 limit).
150% of the trip cost (with a $150,000 limit).
Trip interruption – return air only
Trip delay
$100 per day, with a $500 maximum.
$150 per day, with a $750 maximum.
$200 per day, with a $1,000 maximum.
Missed connection
Baggage delay
Baggage loss
$750 (with a $50 deductible).
Emergency medical
$15,000 (with a $50 deductible).
Emergency evacuation and repatriation
$1 million.
Accidental death and dismemberment
Preexisting medical conditions waiver
Must be purchased within 21 days after your initial trip payment.
Must be purchased within 21 days after your initial trip payment.
Must be purchased within 21 days after your initial trip payment.
All three plans offer an optional car rental collision coverage add-on that covers up to $35,000 (with a $250 deductible). This add-on includes damage caused by collision, vandalism or weather and does not include theft.
Chubb single-trip plan cost
Below is how much a 35-year-old traveler from Utah would pay for travel insurance for a 10-day trip to Argentina valued at $2,500.
The least expensive of the options, the Travel Basics Plus plan will set you back $124.62. The Travel Essentials Plus policy comes in at $150.73 and provides more coverage. The most expensive plan, Travel Choice Plus, costs $215.13 and includes the most coverage with higher limits.
All plans include a $7 policy fee.
Chubb multi-trip/annual travel insurance
Chubb also offers multi-trip or annual travel insurance plans to those who take multiple trips per year. Three policies are available: Travel Basics 365, Travel Essentials 365 and Travel Choice 365.
Below are the coverage limits for annual travel insurance plans offered by Chubb.
Travel Basics 365
Travel Essentials 365
Travel Choice 365
Trip cancellation
Trip interruption
Trip delay
$150 per day, with a $750 maximum (kicks in after five hours).
$150 per day, with a $1,000 maximum (kicks in after five hours).
$150 per day, with a $1,500 maximum (kicks in after five hours).
Missed connection
$500 (kicks in after three hours).
$1,000 (kicks in after three hours).
Baggage delay
$150 per day, with a $300 maximum (kicks in after 12 hours).
$250 per day, with a $500 maximum (kicks in after 12 hours).
$250 per day, with a $1,000 maximum (kicks in after 12 hours).
Baggage loss
Emergency medical
Emergency evacuation and repatriation
$1 million.
Accidental death and dismemberment
Car rental collision damage waiver
$35,000 (with a $250 deductible).
$35,000 (with a $250 deductible).
Security evacuation
Chubb annual plan cost
Below is how much a 35-year-old traveler from Utah would pay for an annual travel insurance policy from Chubb.
The most affordable option of the three, the Travel Basics 365 plan, will set you back $141. The Travel Essentials 365 policy will set you back $233, and the Travel Choice 365 policy costs $449.
Which Chubb travel insurance plan is for me?
If you’re seeking coverage for one trip: Look into the single-trip travel insurance plans, such as Travel Basics Plus, Travel Essentials Plus and Travel Choice Plus.
If you’re traveling extensively: For travelers who take multiple trips per year or who are constantly on the road, an annual plan, such as Travel Basics 365, Travel Essentials 365 and Travel Choice 365, will provide a more economical solution.
If you hold a travel rewards credit card: Take a look at your card’s benefits guide and determine what kind of trip protections, if any, are offered by your credit card. Pick a travel insurance plan with perks that don’t overlap with what is already covered.
How to get a quote from Chubb
To get a quote from Chubb for an individual or family travel policy, start on it’s website. Decide whether you need a single-trip plan or an annual plan, and click on “Get a quote.”
Select between a domestic or an international policy and confirm that you’re a U.S. resident and at least 18 years old by checking the respective box. Enter your travel destination, state of residence, travel dates, the initial trip deposit date and the number of travelers.
Then provide a couple of more details, such as the primary traveler’s age and the cost of the trip.
The quotes for each plan will be displayed on the next page.
For an annual policy, select your state of residence from the dropdown menu, pick a coverage start date, enter the traveler’s age and click “Get quote.”
What isn’t covered by Chubb travel insurance?
Like most insurance providers, Chubb publishes a list of exclusions to its coverage. Below are some of the situations not covered by Chubb travel insurance:
Intentional self-inflicted injuries or suicide.
Normal pregnancy or elective abortion.
Participation in professional athletic events.
Mountaineering.
War, acts of war or participating in a civil disorder, riot or resurrection.
Operating or learning to operate an aircraft.
Being under the influence of drugs or narcotics.
Traveling for the purpose of securing medical treatment.
Traveling against a physician’s recommendation.
Is Chubb travel insurance worth it?
If you look online, Chubb travel insurance reviews are mixed, but they also include car, home and business insurance, not the company’s travel insurance branch specifically.
In any case, before you purchase a plan, we recommend not only comparing prices but also reading policy terms to make sure you understand what’s covered so your claim will be accepted should you need to file one.
How to maximize your rewards
You want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2024, including those best for:
An interest checking account is, as the name suggests, a checking account that earns interest. Typically, checking accounts haven’t offered this feature, while savings accounts did. However, there are a number of interest-bearing checking accounts now available that can help your cash on deposit grow.
Typically more flexible than savings accounts, interest checking can give you a financial boost if they’re a good fit for you. In some cases, however, they may have minimum requirements and other aspects that may not sync up with your money style.
Here’s a closer look at these interest-bearing checking accounts, so you can decide if one might be right for you. Learn more about:
• What is an interest-bearing checking account?
• How do interest-bearing checking accounts work?
• How much interest could you earn?
• What are the pros and cons of interest checking accounts?
What Is an Interest Checking Account?
Whether it’s called an interest-bearing checking account, interest checking account, or high-yield checking, this is a type of checking account where the account holder can earn interest. The interest rate may not be amazingly high: At the end of 2023, the rate averaged 0.70% APY, or annual percentage yield, which is the real rate one earns when compounding interest kicks in. (Occasionally, APYs of 3.00% or higher may pop up.) Even at the lower range, the interest accrued is better than nothing. Honestly, who doesn’t want to earn more interest?
There may, however, be a catch:
• Although the account will pay an APY, account holders may be required to pay monthly maintenance fees or maintain a certain account balance (say, $500 or more).
• In addition, you may be required to receive a certain number of or dollar amount of direct deposits per month or meet other criteria, such as relating to debit card usage.
• You might also have to pay a monthly account fee; again, it depends on the bank you choose. Recent research found that checking accounts had an average monthly fee of $10.77; where an interest account will fall can vary with the financial institution.
• One more point: In many cases, interest checking accounts earn less interest compared to savings accounts.Yes, a checking account has added flexibility that may be beneficial (say, unlimited transactions and debit-card and check-writing features), but it’s worth noting. You might consider a combined checking and savings account to get the best of both worlds.
💡 Quick Tip: Want to save more, spend smarter? Let your bank manage the basics. It’s surprisingly easy, and secure, when you open an online bank account.
How Do Interest-Bearing Checking Accounts Work?
These types of accounts work in a similar way to other kinds of checking accounts. Account holders can make deposits at ATMs, online, by direct deposit, or at branch locations depending on the financial institution.
As for withdrawals, account holders can make bank transfers, withdraw cash from an ATM, write a check, use bill pay, or pay for purchases with a debit card. The only difference is that, instead of earning no money on your balance, you will accrue some interest, usually on a monthly basis.
How Are Interest Checking Accounts Different Than Other Checking Accounts?
The truth is, checking account interest rates will vary depending on the type of account and the financial institution. On average, banks offer an APY of 0.07%. There are high-yield checking accounts that could pay more, but these rates are generally still lower than what you could earn with a savings account. That said, with a little online research, you might find an interest checking APY of 3.00% or higher at this time. Those couple of extra points of interest may well be worthwhile as part of your plan to grow your wealth.
Just be sure to note the account requirements, as mentioned above. If you have to keep more money in the account that is comfortable for your budget and cash flow, you could wind up incurring late fees elsewhere in your financial life.
Here’s an example:
• Perhaps you decide to pay your credit card bill late because you didn’t want your checking account balance to dip below the minimum to earn interest.
• You opt to wait for your next paycheck to hit before you send your payment to your card issuer.
• The credit card fee for the late payment is likely more than the interest you’re earning on the money in your checking account.
So in this situation, keeping your money in an interest checking account might not be a win-win for you.
Common Account Requirements for Interest Checking Accounts
When it comes to opening an interest-bearing checking account, there may be some requirements to wrangle. Keep the following factors in mind:
• Minimum-balance and other account requirements: When you open an account, some financial institutions may require a minimum initial deposit. Current offers for interest-bearing checking range from zero dollars to $500 and occasionally significantly higher amounts as a minimum deposit. Shop around to find the right account for your needs.
Plus, as mentioned above, you may need to maintain a certain balance in order to avoid fees. There may also be other rules such as the amount of transactions you can make on your debit card.
• Fees: Some interest checking accounts may charge monthly fees, as described earlier in this article, which could eat into the interest you earn. You may have to keep a higher balance in your account to avoid fees. Other fees to consider are overdraft fees, and whether you’ll need to pay third-party network fees to access certain ATMs.
• Application requirements: Depending on the financial institution, you may be required to submit documents such as your Social Security number, proof of address, and government-issued photo ID. If you want to open a checking account with a credit union, you’ll most likely need to become a member.
Get up to $300 when you bank with SoFi.
Open a SoFi Checking and Savings Account with direct deposit and get up to a $300 cash bonus. Plus, get up to 4.60% APY on your cash!
Advantages and Disadvantages of Interest Checking Accounts
An interest checking account may not be the best option for you. Consider the following advantages and disadvantages before opening an account.
Advantages of Interest Checking Accounts
• You’ll earn interest Most traditional checking accounts won’t pay you any interest, but with an interest-bearing one, you’ll earn high interest. That means your money will help you earn some money while it’s sitting in the account. Typical APYs can range from 0.50% to 3.00% or higher.
• You’ll have more flexibility Checking accounts tend not to have transaction limits as you may with savings accounts or money market accounts. Plus, you can use checks and a debit card, offering you more flexibility to access your money.
Disadvantages of Interest Checking Accounts
• You may have to meet certain requirements Though there are some interest checking accounts that don’t have minimum balance requirements or monthly fees, some do. That means you could be on the hook for a monthly fee if you can’t meet account requirements. In some cases, these fees could negate the amount you earn in interest.
• You may not get a high interest rate The interest you earn on a checking account tends to be lower compared to ones you earn from a high-yield savings account or money market account. But there are definitely exceptions to the rule: Some banks have offered as much as 3.00% APY or higher on interest checking accounts, so it can truly pay to shop around and see if you can snag one of those deals.
💡 Quick Tip: Are you paying pointless bank fees? Open a checking account with no account fees and avoid monthly charges (and likely earn a higher rate, too).
Where Can I Get an Interest Checking Account?
You can open an interest checking account at most financial institutions, including traditional and online banks, as well as credit unions. As mentioned before, you may be required to become a member of the credit union you want to open a checking account with.
When shopping around, look beyond interest rates. Other equally important factors to consider are:
• Account features (access to your funds, for instance; when the interest accrues)
• Account-holder benefits (are there other perks to being an account-holder, such as a sign-up bonus?)
• ATM, overdraft, and other fees
• Minimum opening deposit and account balance requirements to earn interest.
Is It Worth It to Get an Interest Checking Account?
Thinking carefully about your financial situation and goals should help you determine whether it’s worth getting an interest bearing checking account.
• For those who want to keep a decent amount of money in a checking account to ensure bills and daily transactions are taken care of, it might be worth considering. Why not earn a bit of interest if you can find an account that doesn’t charge fees?
• However, if you’re interested in having a stash of cash available for short-term or medium-term savings goals — as in, you’re not planning on making frequent withdrawals — then a high-yield savings or a checking and savings account might be the better choice.
• If your goal is to save for long-term goals like retirement or a college fund for your child, then an investment account could be the way to go.
Recommended: How to Avoid ATM Fees
The Takeaway
An interest-bearing checking account may be a good fit if you’re looking for an account for daily transactions that can grow your money a bit. It’s important to check the fine print to see if there are any minimum balance requirements and what the fees are. Comparing the potential interest to be earned with any fees that may be charged is a vital step before applying for an interest checking account.
Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.
Better banking is here with up to 4.60% APY on SoFi Checking and Savings.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.
SoFi members with direct deposit activity can earn 4.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a deposit to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.
SoFi members with Qualifying Deposits can earn 4.60% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.
SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.60% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.
SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.
Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.
Interest rates are variable and subject to change at any time. These rates are current as of 10/24/2023. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
To put it simply, an ACH transfer moves funds electronically from one bank account to another. The three letters ACH stand for Automated Clearing House, which is a centralized system. You might think of it as Grand Central Station for the electronic distributions of funds. The ACH network could be how your paycheck appears right on schedule in your bank account thanks to direct deposit, and it may be how you send online payments to, say, your WiFi provider.
ACH transfers play an important role in finance today, so here’s a closer look at:
• What ACH transfers are and how they were created
• The pros and cons of ACH transfers
• How secure ACH payments are
• How ACH payments compare to wire transfers.
What Is an ACH Payment?
An ACH transfer is a convenient way to move money around, without using checks, credit cards, or other methods. It enables direct deposits from employers and government benefit programs, bill payments, and external fund transfers. What’s more, ACH transfers fuel person-to-person payments. Such providers as PayPal and Venmo use the ACH network.
As mentioned above, ACH stands for Automated Clearing House. But it’s not a bricks and mortar location. It is a network that financial institutions use to aggregate transactions for processing. This processing is then typically completed three times a day on every business day.
💡 Quick Tip: Make money easy. Enjoy the convenience of managing bills, deposits, and transfers from one online bank account with SoFi.
How Do ACH Payments Work?
Here, you’ll learn a little more about what is ACH, the history of ACH payments, and how they work.
History of ACH
The ACH network began in the late 1960s, when a group of U.S. bankers worried about the increasing number of checks being issued and cashed. They feared that rising numbers of checks would overwhelm the banking system, and they began to explore technological solutions.
• In 1972, an ACH association formed in California to manage electronic banking transactions, with other regional ACH networks forming soon after that.
• In 1974, these regional networks formed NACHA (the nonprofit National Automated Clearing House Association) to oversee and administer the ACH network. This organization creates and enforces how this network works, while the Federal Reserve and The Clearing House actually process the transactions.
• In 1975, the Social Security Administration began testing direct deposit, which led to today’s widespread adoption. Approximately 99% of SSA’s payments are currently completed via direct deposit.
• In 2001, online and phone payments via ACH became available, a key step forward to accelerating and automating banking transactions.
• In the most recent year studied, ACH payments numbered more than 30 billion, and the total dollars transferred exceeded $77 trillion. These figures indicate how big a role ACH transfers play in global finance.
Get up to $300 when you bank with SoFi.
Open a SoFi Checking and Savings Account with direct deposit and get up to a $300 cash bonus. Plus, get up to 4.60% APY on your cash!
Categories of ACH
The ACH network processes bank transfers for both direct deposits and direct payments. Direct deposits usually include:
• Paychecks
• Government benefits
• Tax refunds
• Expenses that an employer is reimbursing an employee for
• Annuity payments
• Interest payments.
In terms of direct payments, the ACH network may process other transactions. What is an ach transfer can include:
• Online bill payments from your bank account
• Zelle
• PayPal, Venmo, and other P2P services.
Types of ACH
As you’ve already learned, ACH works both ways: incoming and outgoing payments can be processed via the ACH network.
ACH Credit
An ACH credit occurs when one party sends funds to another entity. A very familiar instance of this would be the way (if you are among the millions who have direct deposit) arrives in your designated bank account on payday. Your employer sent instructions, their bank transmitted funds to yours, and you received your money.
ACH Debit
An ACH debit, as you might expect, moves in the opposite direction. In this case, funds are pulled from one account and processed in batches to get to their destination. In the situation of a direct deposit paycheck, while the employee receives the ACH credit, the employer’s account gets debited.
Recommended: How to Calculate Savings Account Interest
What Is an Example of an ACH Payment?
You’ve just gotten the scoop on ACH credits vs. debits, but what is a specific example of an ACH payment? When Social Security payments get deposited in millions of Americans’ bank accounts monthly, that’s the ACH system at work.
Also, if you’ve set up an automated payment of a utility or other recurring bill, that may also be an example of an ACH payment in action.
Benefits of ACH Payments
So now you know what ACH transactions are and how they became so popular. Let’s look at their benefits to your daily life and banking.
• Speed. They are quick and save you time running around with checks and the like. Plus, the transactions themselves can be fast. The transfers are typically completed within one day. There may be ways offered to speed up your payment, often for a fee (such as when PayPal or Venmo offers an instant transfer).
• Convenience. It can be very convenient to have mortgage payments, utility bills, and other payments automatically deducted from a bank account. Or send money to someone via a P2P service. With ACH payments, as we noted, there’s no need to travel to the financial institution to pay the bills or to write a paper check and mail it in.
• Low cost. ACH transfers are typically free and may even actually save you money. For example, a bank may offer a lower rate on a mortgage loan or student loan if you set up an automatic ACH funds transfer for your payments. (An exception may be when a financial institution charges a nominal fee to transfer funds to another bank.)
Downsides of ACH Transfers
There are a few potential disadvantages when it comes to using ACH transfers. Specifically:
• Transaction limits. Some banks will limit how much money you can send by ACH transfer in a specific time period, or they might not accept international ACH transfers.
• Penalties for too many transactions. If you are completing ACH payments from your savings account and that account has a cap on how many withdrawals you can complete per month, you could be penalized.
• Timing matters. Not all banks send ACH transfers at the same time of day — meaning they may have a cut-off time for a transfer to be processed on the next business day. This might cause problems for people needing to pay a bill by a certain due date and/or time.
Security of ACH Transfers
You may wonder whether these electronic transactions are secure. An ACH transfer can in fact be more secure than many other payment methods.
• The reality is that paper checks can always be lost or stolen. With ACH deposits or payments, you only need to provide bank information once, when the automated transaction is set up. Contrast that with writing a check every month and mailing it.
• Regulations exist that protect consumers in the rare case of an electronic funds transfer negatively impacting their bank accounts because of fraud or error.
• ACH payments are very safe because they go through a clearing house that has strict rules about confidentiality of information. In addition, ACH transfers typically have an extremely low rate of error.
ACH Transfers vs. Wire Transfers
When thinking about these kinds of transactions, you may wonder, “What’s the difference between ACH transfers vs. wire transfers?” A wire transfer is another method of electronically transferring funds, which means this system comes with many of the same benefits as ACH transfers bring.
Consider a couple of scenarios that highlight the potential differences:
• Wire transfers may occur within one business day, with funds often available for use the same day. In many cases, though, a bank employee needs to review this largely automated process, so the funds may not be immediately visible in the recipient’s account — and international wire transfers may take more than a day.
• ACH transfers, however, are processed in clearinghouses and banks in batches. The ACH system may sometimes provide same-day transfers and is increasingly moving towards this same-day benefit being available more often.
• In general, a wire transfer cannot be reversed.
• An ACH transfer, though, can be reversed in some situations.
• A last but important point: ACH transfers are often free, while wire transfer fees can cost the person sending it up to $35 or more, and the recipient might have to pay a small fee, too.
Recommended: Can You Use Your Debit Card in Another Country?
The Takeaway
ACH transfers can speed and smooth your financial life, automatically depositing and withdrawing funds so you don’t have to deal with checks, cards, or the time it takes for money to clear. That’s why they are such a popular way to transfer funds, such as receiving one’s paycheck by direct deposit.
In addition to ACH payments, another way to ensure a smoothly functioning financial life is to partner with a bank account that offers convenient access and the tools you need most.
Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.
Better banking is here with up to 4.60% APY on SoFi Checking and Savings.
FAQ
How long does an ACH transfer take?
ACH transfers typically take a day, but they may take as long as three days.
What is needed for an ACH transfer?
To complete an ACH transfer, the following are needed: the name, routing number, and account number of the destination, whether the account is a business or personal account, and the amount of money to be sent.
How do I set up an ACH payment?
An ACH payment can be set up in a variety of ways. As a consumer vs. a business, you might use a payment app or see what forms of money transfers your bank uses. For instance, many use Zelle. Or you could see if the prospective recipient of your funds (say, a utility company) offers an automated payment system, which might use the ACH network.
Can you send an ACH to a personal account?
Yes, you can send an ACH payment to a personal account. For example, if you use a payment app to send a friend money for your share of a dinner out that they paid for, you would likely be sending an ACH payment.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.
SoFi members with direct deposit activity can earn 4.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a deposit to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.
SoFi members with Qualifying Deposits can earn 4.60% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.
SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.60% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.
SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.
Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.
Interest rates are variable and subject to change at any time. These rates are current as of 10/24/2023. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
The desire to get a good deal unites practically all travelers. Whether you’re looking for a cheap getaway or a luxury vacation, no one wants to spend more than necessary. When it comes to booking flights, travelers may naturally head to an airline’s website. However, that’s not always the best site to book flights.
Whether it’s taking advantage of credit card perks, earning bonus miles or saving money, the best flight booking site can vary depending on your situation and willingness to get creative. Let’s take a look at six of the best sites to book flights and when each is the best option.
The best flight booking sites
1. Google Flights
For ease, speed and features, Google Flights is arguably the best website for flight searches. Search results appear almost instantly. Filters let you narrow down to nonstop options, select a subset of airlines, limit by price or factor in the price of a bag. Similarly, you can use Google Flights filters to avoid certain airlines, multi-stop itineraries, long layovers, early flights or pretty much whatever you might want to avoid.
You can easily check flexible dates, and if you’re flexible on where you go you can use the Explore map to see prices for a variety of destinations for certain dates, a certain month or anytime in the next six months.
Google Flights partners with hundreds of airlines and online travel agencies (OTAs) to pull current flight prices. That way you don’t have to search each of these sites to be able to see the options. Once you select your preferred trip, Google Flights links you to the top booking options for actually booking your flight — including the airline itself and the best OTA booking options.
The downsides of Google Flights are few. One is the lack of Southwest flight prices. Although Southwest flight schedules will show in flight search results, Southwest flight prices aren’t available. That’s because Southwest chooses to publish flight prices only on its website.
Another downside is that Google Flights doesn’t always show the cheapest prices — particularly for international flights. That means it’s worth double-checking prices on another site before booking through Google Flights.
2. Kayak
Like Google Flights, Kayak searches hundreds of other websites and flight booking platforms to find the best deal. Kayak generally doesn’t let you book flights directly. However, one benefit of Kayak is the streamlined process. Rather than having to click through several pages to confirm your selection, clicking “view deal” on the results page can take you right to the cheapest booking option.
Also, some travelers may find Kayak’s flexible date search a bit easier to work with as you can see results from several days in the search results — eliminating the need to check each day’s results separately.
But perhaps the most important reason to use Kayak instead of Google Flights is that it can catch better deals. For example, we found a $550 round-trip flight from Los Angeles to Barcelona using Google Flights. Kayak found a way to lower that price to just $472 round-trip — at least once you scroll past an advertisement.
Note that Kayak manages other flight search sites — including Momondo and Cheapflights — so the results may be very similar between these sister sites.
3. Expedia
So far, we’ve focused on ease in flight searching, and that’s going to be enough for many travelers. However, now let’s add in some additional elements to consider when choosing the best flight booking site: earning rewards and saving by booking packages. Expedia excels at both of these.
Through the new One Key rewards program, travelers can earn 0.2% in OneKeyCash from flight bookings made through Expedia. That’s not much, but it can stack on top of the awards you earn from the airline and those that you earn on your credit card purchase.
Even better, you’ll earn credits toward One Key elite status by booking your flight through Expedia. As you climb up the tiers, you’ll unlock up to 20% savings on hotels, get hotel upgrades, priority support and even price drop protection.
Plus, Expedia boasts that travelers can “save up to 30%” when bundling a hotel with a flight booking — although actual discounts are likely to vary.
4. Capital One Travel
For many Capital One cardholders, Capital One Travel might just be the best flight booking site. Part of this is to take advantage of cardholder benefits. For example, Capital One Venture X Rewards Credit Card holders earn 5x Capital One miles when booking flights through the Capital One Travel portal. Plus, Capital One Venture X Rewards Credit Card holders get up to $300 off travel booked through the Capital One Travel portal each cardholder year.
Also, Capital One Travel can help you truly get the best price for your flight. Capital One partnered with travel data company Hopper to show suggestions about when it’s the best time to book.
Capital One backs up these recommendations with money. If you book a flight through Capital One Travel when Hopper recommends doing so, you’ll get up to a $50 credit toward future travel if the price drops within the next 10 days.
5. Kiwi
Would you be willing to book a trip as two separate tickets in order to save money? That’s the idea behind Kiwi. Instead of simply searching flights from your home airport to your destination, Kiwi checks all potential options to get between A and B. That could mean taking a bus or train from your home city to another to catch a flight to your destination. Or, Kiwi might pair a low-cost domestic flight with a cheap international flight from another city to lower your total cost.
For example, when we priced out a round-trip flight from Phoenix to Tokyo, the cheapest option when booked as one ticket cost $1,353 round-trip — and that’s with an overnight stay in Vancouver.
Pricing out the same itinerary and dates through Kiwi drops the price to just $789 round-trip. The secret? Booking this as two round-trip flights: One from Phoenix to Los Angeles on Frontier and a separate round-trip from Los Angeles to Tokyo on Zipair.
Keep in mind that there are risks with booking separate tickets to get where you want to go. If a delay or cancellation causes you to miss your connection, the second airline/bus/train company isn’t obligated to honor your ticket and rebook you on the next option. So make sure to factor in all of the risks of booking travel like this.
6. BookWithMatrix
ITA Matrix is a very powerful and ultra-customizable search platform for finding exactly the flight itinerary you want — whether that’s booking a longer layover, avoiding certain aircraft types or booking nerdy trips such as the Alaska Milk Run.
The catch: Travelers can’t actually book flights through ITA Matrix. And, unlike Google Flights, ITA Matrix doesn’t even link to the best flight booking site for that itinerary. Instead, travelers are left to attempt to re-create the same itinerary through another flight booking website — which can be hard in the case of certain complex itineraries.
Enter BookWithMatrix. Travelers can copy-paste their perfect itinerary from ITA Matrix into BookWithMatrix to get bookable links through the airline or select OTAs.
Alternatively, travelers have the option to install the PowerTools extension in Google Chrome. This extension adds booking links right on the ITA Matrix itinerary page, avoiding the need to browse to another page.
Final thoughts on the best flight booking site
There’s not a one-size-fits-all best website for booking flights. Instead, the best flight booking site for you is going to depend on how simple you want the process to be, whether you’re willing to get creative with your booking, and even which credit cards you have.
For most travelers, the simplicity of Google Flights is going to make it the best one-stop shop for searching and booking flights. However, it’s worth considering other options if you’re flying internationally, want to book a flight-and-hotel package or have a Capital One Venture X Rewards Credit Card.
How to maximize your rewards
You want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2024, including those best for:
The information provided on this website does not, and is not intended to, act as legal, financial or credit advice. See Lexington Law’s editorial disclosure for more information.
While getting denied on a credit card application doesn’t impact your score, the hard inquiry from applying for credit may temporarily cause your score to drop a few points.
Not getting approved for a credit card can be a bummer, but does getting denied hurt your credit score? Read on to discover how getting denied affects your credit, potential reasons why your application was denied and the next steps to get approved in the future.
Table of contents:
How does applying for a credit card affect your credit?
After you submit a credit card application, the lender will likely perform a credit check to evaluate your credit history. This triggers a hard inquiry, which is a lender’s request to obtain your credit report from the credit bureaus.
Typically, a hard inquiry causes your credit score to drop around five points or so. While hard inquiries remain on your credit report for two years, the effect on your credit score only lasts a few months to a year. Remember that the effect on your credit is the same regardless of whether your application is approved or denied.
While scoring models provide rate shopping windows for auto loans, student loans and mortgages, these windows don’t apply to credit card applications. To lessen the effects of hard inquiries on your credit, try waiting at least six months between submitting credit card applications.
6 reasons why credit card applications are denied
Below are potential reasons why your credit card application was denied and tips to increase your chances of being approved in the future.
1. Insufficient credit history
Insufficient credit history means that there isn’t enough information in your credit file to determine your risk.
When applying for a credit card or loan, lenders look at your credit history to determine your track record as a borrower. A lack of a credit history is essentially a giant question mark for the lender, which prevents them from assessing your risk level.
Credit tip: Consider applying for a secured credit card or becoming an authorized user on someone else’s account to begin building credit.
2. Poor credit score
Many credit cards have credit score requirements for approval. While this varies from card to card, most require a credit score in good range or higher, which starts at 670 according to the FICO® model. The higher your credit score, the more likely lenders are to approve you and offer favorable interest rates and terms.
Credit tip: Take steps to improve your credit score, such as making timely payments, lowering your credit utilization and disputing inaccuracies on your credit report.
3. Late payments
A history of late payments may indicate to lenders that you might struggle to repay the credit they lend you. Not to mention that payment history is the most important factor in determining your credit score, so too many late payments can severely damage your credit.
Credit tip: Enroll in autopay or set reminders to pay your bills on time.
4. Too many hard inquiries
In addition to the effect that hard inquiries have on your credit score, applying for too many credit cards in a brief time frame might signal to creditors that you aren’t financially stable and, therefore, are a high-risk borrower.
Credit tip: While there is no hard and fast rule, consider waiting about every six months between each new credit card application.
5. High debt-to-income ratio
Your debt-to-income ratio is the amount of debt you owe each month divided by your monthly income. Generally, a low debt-to-income ratio indicates to lenders that you have a higher likelihood of being able to make payments.
Credit tip: To maintain a good debt-to-income ratio, aim to keep your total monthly debt payments under 36 to 43 percent of your monthly income.
6. Inaccuracies on your credit report
Having errors or inaccuracies on your credit report can stand in the way of getting approved for credit. To check for errors, download a free copy of your credit report at AnnualCreditReport.com and identify errors such as incorrect accounts, inaccurate balances or errors regarding your personal information.
Credit tip: If you find errors on your credit report, file a dispute with the credit bureau to potentially have the inaccurate information removed.
Steps to take after getting denied for a credit card
If your credit card application is denied, consider taking the following steps to increase your chances of approval:
Determine why your application was denied: Creditors must send you an adverse action notice that details why your application was denied.
Ask the creditor to reconsider: Most banks have a credit card reconsideration line you can call to plead your case. You may have been denied by mistake, so it never hurts to follow up.
Wait to reapply: While your first thought may be to reapply for the card, try waiting six months between submitting credit card applications.
Research alternative cards: Some credit cards are harder to get approved for than others. For example, platinum rewards cards have more stringent requirements than secured cards. Consider the card’s score requirements against your own score before applying.
Seek preapproval: Many creditors send preapproval letters after using soft inquiries to determine that you meet the initial criteria to get approved for the card. While preapprovals don’t guarantee approval, they can help you filter through cards you won’t get approved for without getting a hard inquiry on your credit report.
Monitor your credit: As you work to improve your credit, continue to check your credit score and report so you can determine when you have a better chance at approval.
At Lexington Law Firm, our team could help you manage and work to improve your credit to potentially get approved for credit cards and loans. To determine your current credit status, get your free credit assessment today.
Note: Articles have only been reviewed by the indicated attorney, not written by them. The information provided on this website does not, and is not intended to, act as legal, financial or credit advice; instead, it is for general informational purposes only. Use of, and access to, this website or any of the links or resources contained within the site do not create an attorney-client or fiduciary relationship between the reader, user, or browser and website owner, authors, reviewers, contributors, contributing firms, or their respective agents or employers.
Reviewed By
Sarah Raja
Associate Attorney
Sarah Raja was born and raised in Phoenix, Arizona.
In 2010 she earned a bachelor’s degree in Psychology from Arizona State University. Sarah then clerked at personal injury firm while she studied for the Law School Admissions Test. In 2016, Sarah graduated from Arizona Summit Law School with a Juris Doctor degree. While in law school Sarah had a passion for mediation and participated in the school’s mediation clinic and mediated cases for the Phoenix Justice Courts. Prior to joining Lexington Law Firm, Sarah practiced in the areas of real property law, HOA law, family law, and disability law in the State of Arizona. In 2020, Sarah opened her own mediation firm with her business partner, where they specialize in assisting couples through divorce in a communicative and civilized manner. In her spare time, Sarah enjoys spending time with family and friends, practicing yoga, and traveling.
The Austin-Bergstrom International Airport in Austin, Texas, is growing almost as fast as the city itself. And as the closest airport to major events like South by Southwest, Austin City Limits music festival and more, the compact airport sees its fair share of traffic.
And while many visitors who pass through spend their time at the airport’s local restaurants or shops, Austin airport lounges also offer a place to kick back and unwind before your flight.
Let’s take a look at the airport’s four lounges, how to access them and what each has to offer travelers.
An overview of Austin airport lounges
While there are a number of airlines that fly in and out of Austin, only three have lounges: United Airlines, American Airlines and Delta Air Lines. There’s also a Chase lounge for Chase Sapphire Reserve®cardholders.
🤓Nerdy Tip
Besides the Chase lounge, there aren’t any other options that are accessible via non airline-specific membership, such as Priority Pass, or for Capital One or American Express cardholders.
These lounges are located in the main terminal, the Barbara Jordan Terminal, so no matter what gate you’re flying out of, any lounge is only a short walk away. There are no lounges in the airport’s smaller South Terminal, which is a few minutes’ drive down the road.
To enter the airline lounges, you typically need at least one of the following:
A first or business class ticket with American, Delta or United.
A lounge membership with American, Delta or United.
Elite status with one of the above airlines or their airline alliance.
A purchased day pass (if the lounge offers them).
It’s also important to note that all Austin airport lounges will ask to see a same-day departing boarding pass to enter. Save for one exception —travelers flying American or a Oneworld Alliance airline with a first or business class ticket — these lounges are only accessible on your way out of town, not upon arrival.
Delta Sky Club
On the mezzanine level near gate 4.
Open from 4:15 a.m. to 8:00 p.m. daily. Passengers can access the lounge any time within three hours before their scheduled flight.
Entry requirements:
Hold a Delta One or SkyTeam Premium flight boarding pass.
Hold an Executive or Individual Delta Sky Club membership, which is available to Medallion members.
Hold a Delta SkyMiles® Reserve American Express Card or Delta SkyMiles® Reserve Business American Express Card, which offers free access to the lounge.
Hold the Delta SkyMiles® Platinum American Express Cardor Delta SkyMiles® Platinum Business American Express Card, which offers cardholders the option to purchase access for $50 per person.
Terms apply.
Lounge amenities: Inside the lounge located above the gates, there’s a full-service bar, comfortable seating, tables for dining or working, Wi-Fi and a covered outdoor deck. There’s coffee, tea, complimentary and premium alcoholic beverages and a hot food buffet.
United Club
On the mezzanine level, across from gate 22.
Open 4:30 a.m. – 7:15 p.m. daily.
Entry requirements: .
Hold a boarding pass for:
A premium cabin on an international itinerary.
First class with a Star Alliance member airline.
Hold United Club membership.
Have purchased a one-day pass.
Hold the United Club℠ Infinite Card, which includes United Club membership.
United Club℠ Infinite Card
NerdWallet Rating
Intro offer
90,000
Earn 90,000 bonus miles after you spend $5,000 on purchases in the first 3 months from account opening.
Miles
Lounge amenities: The Austin airport United Club offers a full-service bar, light snacks and complementary Wi-Fi, plus lounge chairs, high-top tables and space to get a bit of work done.
American Airlines Admirals Club
Across from gate 22.
Open Sunday to Friday 4:15 a.m. – 9:15 p.m and Saturday 4:15 a.m. – 8:15 p.m.
Entry requirements:
Hold a first or business class ticket on a departing or arriving flight operated by American or a Oneworld Alliance airline.
Hold an Admirals Club membership.
Hold a Citi® / AAdvantage® Executive World Elite Mastercard®.
Have purchased a one-day pass (provided there’s space in the lounge that day).
Lounge amenities: Inside this airport lounge in Austin, you’ll find complimentary food and drinks, including coffee and tea, a full-service bar, Wi-Fi and space to work.
Chase Sapphire Terrace
On the mezzanine level by gate 1.
Open daily from 10 a.m.– 8 p.m. Passengers can access the lounge anytime within three hours before their scheduled flight.
Entry requirements:
Hold a Chase Sapphire Reserve® card or a J.P. Morgan Reserve credit card. You may also bring in two guests.
Chase Sapphire Reserve®
NerdWallet Rating
Intro offer
60,000
Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That’s $900 toward travel when you redeem through Chase Ultimate Rewards®.
Points
Lounge amenities: There’s indoor and outdoor seating on the terrace of this Austin airport lounge, plus grab-and-go food, local beverages, games like shuffleboard and cornhole and comfortable seating in a modern and sunny space.
Austin airport lounges recapped
While there are a handful of lounges at the Austin airport, don’t expect the variety and multiple locations you might see at larger hubs like New York-John F. Kennedy.
The four lounges are all located within the main terminal, so it’s easy to locate a place to kick back, relax, grab a bite and maybe get some work done before your flight.
How to maximize your rewards
You want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2024, including those best for:
A same-day credit card is also referred to as an instant-use credit card. When credit card providers offer this option, they provide tools that make it possible for you to make charges on the card immediately once you’re approved. This is in contrast to the traditional process, which requires you to wait for around two weeks until the actual credit card arrives via mail. Find out more about same-day credit cards below, including how they work and how you can get one.
How Do Same-Day Credit Cards Work?
When you apply for a credit card from a company that offers this option and you’re approved, the company emails you information that allows you to make charges on your account without having the physical credit card. Each credit card company handles this differently, but some common options include:
Providing you with the credit card number. Some card issuers provide you with the credit card number that will come on your card so you can use it to make purchases the same day you’re approved for the card.
Providing a virtual card number. Other card issuers provide a virtual credit card, which is really just a card number linked to your account that’s not the same number as on your physical card. In some cases, this number is dynamic, which means it’s created uniquely for each purchase to provide greater protection when shopping online.
Offering an app that lets you connect your account with digital payment wallets. In some cases, the card issuer prompts you to download an app and connect it to your account. You can then use the app to make payments or connect your card account to digital wallets and services, such as Google Pay or Apple Wallet. Then, you can use those services to make payments.
Where Can You Shop With a Same-Day Credit Card?
Typically, you’ll have the best luck shopping online with a same-day credit card. You can also easily make purchases via phone by providing the credit card number to the vendor. It’s not as easy to use this type of card at a physical register because you don’t have anything to swipe. However, if you’ve connected your new credit card number to a digital wallet, you can pay with that method at stores and other physical locations that accept Apple Wallet, Google Pay, and other such options.
The Benefits of Same-Day Credit Cards
The most obvious perk of a same-day credit card is that you can use it instantly once you’re approved. This may come in handy if you want to use the credit card to make a necessary and time-sensitive purchase. It can also be handy if you’re applying for the card because of a balance transfer offer. You can get the ball rolling as quickly as possible to transfer debt from a higher-interest card, potentially saving yourself some interest or the need to make a payment on that other card.
Another time it can be helpful to be able to use your card immediately is when you’re approved for a rewards card and there’s a signup bonus. These bonuses typically require spending a certain amount in the first few months after opening the account. If you have to wait for the physical card to arrive, you may lose two weeks or more of that bonus-earning opportunity.
Are There Any Downsides to Instant-Use Credit Cards?
The majority of potential downsides to these types of cards are the same issues you might face with any credit card. You may be dealing with a high interest rate, and if you run up your balance and can’t pay it off each month, you could face a lot of interest expense over time. Missing payments or carrying high balances can also negatively impact your credit.
It’s also important to note that many credit card lenders don’t immediately make your entire credit limit available. For example, if you’re approved for a credit limit of $5,000, you may only have instant access to $2,500 until your physical card arrives.
Which Lenders Offer Same-Day Credit Cards?
Many credit card companies offer same-day credit cards, including American Express, Capital One, and Discover. Retail store credit cards are also often instant-use cards. If you apply at the register at Kohl’s, Best Buy, or other retailers and are accepted, you can usually use your account to make purchases within the store that day.
Should You Seek an Instant-Use Credit Card?
In most cases, whether you get instant access to your credit card account is likely not the most important consideration. After all, this perk becomes obsolete in a few weeks when you receive your physical credit card.
Instead, consider more long-term factors when choosing the right credit card for you, including interest rates, annual fees, customer service options, perks, benefits, and rewards. Start your research for the right credit card for you in our credit card marketplace.
2023 was a turbulent year for airline elite status. A few major airlines announced significant loyalty program changes — many of which went into effect on Jan. 1, 2024. In most cases, it’s made a more challenging path with higher spending requirements to earn airline elite status.
Some of the most notable and drastic shifts happened to the Delta Air Lines SkyMiles loyalty program. In September, the airline announced it would award Medallion elite status solely based on spending and limit Delta Sky Club access for many customers starting in 2024. The updates were so drastic that Delta walked back some of its most controversial changes, including reducing the spending requirement to earn status.
Other airlines have made minor loyalty program modifications:
Frontier Airlines overhauled its loyalty program to align status earning with dollar spending rather than based on physical miles flown. This kicked in with the new year.
Southwest Airlines made it easier to earn elite status in 2024 by reducing the number of flights needed to earn status.
As of March 2024, Alaska Airlines will simplify partner redemptions based on distance and cabin. According to Alaska Airlines, more than 60% of partner nonstop routes will start at a lower price point (but that implies others will become more expensive).
American Airlines made some changes in 2024, including adding new earning and redemption opportunities. It’ll also soon offer one-day lounge passes for sale.
Which airline program provides the most value?
NerdWallet’s analysis focuses on elite status perks that offer concrete value, such as bonus rewards, seat upgrades and free checked bags. We compared these values against the spending needed to earn each status level. That indicates which elite programs truly offer excellent value per dollar spent.
To generate a single number to compare loyalty programs, we calculate an “effective rewards rate,” which accounts for the value of the benefits you receive relative to the amount you already spent with the airline.
There’s variation across airline loyalty programs, but the average return across all programs is 6.28% in value per dollar spent, meaning you’d get an average of a little over $6 per $100 spent.
Alaska’s rewards program stands out at the top end with its 9.7% rate — the equivalent of earning nearly $10 in value for every $100 spent. Hawaiian Airlines, which in December announced plans to merge with Alaska, isn’t far behind with an 8.89% earning rate.
Frontier and Spirit Airlines trail far behind with paltry 3.92% and 3.45% rewards rates, respectively.
Understand what status is worth
Some programs slap labels like “Gold” and “Platinum” on benefits that hardly sparkle, so be skeptical of chasing titles that sound fancy but ultimately offer mediocre benefits.
A-List Preferred is the highest level of status with Southwest, but its value is low, with no option for premium class seats or airport lounges. You’d have to spend an estimated $14,400 to earn A-List Preferred (though you could get it for less if you fly a lot of low-cost flight segments), yet NerdWallet values its benefits at less than $1,400. Don’t try too hard to chase Southwest status.
Meanwhile, the top tiers at Alaska, Hawaiian, United Airlines and American Airlines mean something. With Alaska MVP Gold 100K, you’ll receive nearly $9,000 in value with the first-class upgrades, free checked bags and lounge passes. Earning it requires an estimated $12,000 in Alaska spending, translating to a roughly 73% rewards rate.
Earning United Premier 1K status is neither cheap nor easy, as you’ll have to spend an estimated $30,000 with United for the honor. But NerdWallet values the benefits (which include instant premium cabin upgrades and priority check-in) at nearly $19,000, offering a 64% return.
Look for promotions
You can sometimes find limited-time promotions with easier routes to earning elite status. For example, United MileagePlus is currently running a Premier Status Match Challenge through the end of 2024.
Leverage airline credit cards
If you’re chasing elite status for benefits like free checked bags, Wi-Fi or early boarding, many airline credit cards offer those perks without awarding you elite status.
How to approach airline elite status in 2024
As more airlines tie elite status to spending, it can feel like the value of your loyalty has taken a nosedive, especially if you previously earned status through low-cost flights. On the other hand, some high rollers are rejoicing. After all, a higher threshold to earn status only makes it more valuable for folks who have it through reduced competition for seat upgrades or fewer people overcrowding airport lounges.
However, having elite status is only part of the reason to pick which airline to fly. Sometimes elite status can be more limiting than freeing, as you might be more inclined to fly at an inconvenient time or book a more expensive flight just to flex your benefits.
By leveraging credit card bonuses, seeking targeted promotions and being open-minded to the best flight rather than one operated by the brand you have status with, you can maximize the value of your travel.
Not to mention, airfares have dropped over the past year despite inflation affecting most other sectors. Some experts expect airfares to continue dropping. According to American Express Global Business Travel’s 2024 Air Monitor report, economy class flights from North America to Europe are expected to drop by 3.5% versus their 2023 prices, while those to Asia are expected to drop by 7.5%.
For price-conscious consumers, that might be a better trade anyway.
How to maximize your rewards
You want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2024, including those best for: