Rent payment is huge spending in our daily life. As I mentioned in this post: Credit Card: A Big Cash Flow Generator, if we can use credit cards to pay everything we need to pay, we can accumulate big rewards, then we can convert them to cash flow. In this post: My Cash Flow from Credit Cards: How I earn $542 per month, I have shown my credit card rewards in the past 1 year(And this is only from American Express, I don’t include other credit cards reward in the post).
Since Rent payment is big, we shouldn’t miss the opportunity to use the credit card to pay. However, sometimes you will find it is difficult to use credit cards: either the landlords don’t accept credit cards, or they charge very high transaction fees(as high as 2-3% per transaction. You pay $1500, you need to pay $30-$45 extra).
To resolve these problems, I have some methods to share.
First, you can use debit cards with a reward to pay your rent if the landlord doesn’t accept credit cards. I mentioned the Enzo debit card in this post: Be A Found Member of A High Yield Checking Account, you can get 2% cash back to pay rent. Also, you can have a Discover Debit card, you will get 1% cashback.
Another solution is the Bilt Reward card, a credit card specialized for rent payments. Although it is a credit card, it won’t trigger any transaction fee if you pay for your rent. Even when your landlord doesn’t accept credit card payment, Bilt can send him the check, or generate a routing number and account number for you to input online as a Checking account. Either way, you can earn 1 point per dollar spending. Then points could be transferred to many partners or used to pay off your rent. For more information, you can visit: Bilt Rewards – Earn Points on Rent.
The advanced method would be credit cards with high ratio rewards. For example, if the apartment charges a 3% fee, but you use a card with 10% cash back, you can still earn 7% back, right? You may ask which card I can earn such a high cash back ratio? The answer is the welcome bonus. The welcome bonus, or Sign-up bonus, is the most generous reward you can get from a credit card. Let’s see some examples:
- American Express Gold Card: spending $4000 to get 75,000 points, cash back ratio is 18.5%
- American Express Blue Cash: spending $3000 for $400 cash, cash back ratio is 13%
- Citi Premier: spending $4000 for 80,000 points, cash back ratio is 20%
So, for me, the strategy would be, calculate the total rent you need to pay every year, then choose 3-4 cards to apply every quarter, so you can maintain a very high level of cash back from your rent spending.
Again, rent payment is inevitable, and you should maximize the cash back from it.