This post is the continuation of my last post about “tips to build a credit score for expats living in the US“. If you haven’t read that post, I recommend you to do that first because:
- I am assuming that at this point, you already have a Chase Sapphire card (probably the Chase Sapphire Preferred), and an American Express Platinum card. If you don’t have them, then read this post and probably try to sign up with one of them. The links here are my referral links.
- The second assumption: it is likely that you buy a lot on Amazon, you already signed up for an Amazon Prime credit card before you read this post 😛
- This means over the past 5 or 6 months, you sign up and got approved for at least 2 or 3 US or even 4 credit cards.
- Your credit score is above 700.
- My last assumption is that you want to collect points/miles mainly for traveling purposes, including using points/miles to pay for air tickets, hotels, car rentals, etc.
So the question is what to do next?
I have been reading different websites (All the hacks, The points guy, Travel on Points, Nerd wallet, Upgraded Points) /listening to various podcasts, and here are my observations and recommendations for expats living in the US:
- Overall, American Express and Chase programs are the most desirable because they are generous with their sign-up bonuses (aka SUB for short), and their points are generally worth more when transferring to partners. They have a lot of airlines and hotel partners for point transfer.
- Point transfer means transferring American Express or Chase rewards points to the airlines or hotels you want to book.
- Having a large network of airline/hotel partners means as consumers, you have more choices and can find better deals.
- Sometimes, you will hear or read people refer to Chase Ultimate Reward points or American express Membership Reward points as flexible points for the above reason. You can transfer the points flexibly to many partners.
- It is different from a specific hotel or airline credit card. With the hotel or airline cards, you only earn points or miles with that particular hotel or airline and you can not transfer it (most of the time) to other hotel chains or airlines. Hence, going with Chase or American Express programs should be your first choice.
- A typical sign-up bonus can be between 80k or 100k points (or more) for Chase or American Express. This equates to about $1000+ of airline/hotel cost that you can deduct using miles/points.
- Even if you have a specific trip in mind and you find an amazing deal with a hotel or airline-sponsored credit card, don’t proceed until you read the entirety of this post
Chase 5/24 rule and Amex “jail”
What is the Chase 5/24 rule?
It simply means Chase will not approve your new credit card application if you have opened more than 5 credit cards across all US banks over the past 24 months. Is it an official rule on Chase website? Nope, it is not, but this is crowdsourced and you can read more about it here. So that means you need to be very strategic about the sequence of credit cards that you want to apply. There are exceptions to this rule though. Personally, I got the exception and can get another card from Chase even though I was at the 5/24 cap.
Amex jail
I read about this from a few Facebook Groups but I couldn’t find any reliable sources about this so I don’t include any links here. It basically means that Amex may not approve your welcome offer (aka signup bonus) if you open too many cards in a short period of time and/or close too many Amex cards in the past. This is less of an issue for new expats in the US like us as we haven’t got that many Amex cards to start with.
Apply and max out on all of the signup bonuses from Chase first
Given the above context and rationale and the fact that you are now at least 3/24 or 4/24 from Chase’s perspective (i.e. opening 3 cards over the past 24 months), I think it makes sense to max out 5/24 from Chase next. This is where the Chase trifecta comes in. There are a lot of articles that talk about “Chase trifecta” so you can do a simple google search for it (like this one, or this). The idea is a combination of Chase cards that will maximize the number of points you can get, depending on your typical lifestyle.
Everyone seems to recommend that the next Chase card should be either Chase Freedom Flex or Chase Freedom Unlimited or both depending on your 5/24 status. Of course, if you can qualify for a business credit card from Chase, go for it as your third card under the trifecta. (It is likely that your 5/24 status is already at 3/24 or even 4/24 so you can only apply for one more Chase Freedom card.)
Move on to Amex trifecta after a few months
After you receive all of the Chase sign-up bonuses with the newly approved Chase cards, you may continue with the Amex trifecta. Similar to the Chase trifecta, a few Google Searches will show you the latest recommended combination of cards to get from American Express to complete the trifecta.
As of the writing of this post, besides the American Express platinum card, they recommend getting the Amex gold card and another business card. The Amex gold card can be a good option for spending on categories that Platinum doesn’t cover. They often have a good sign-up bonus too so do a search for them before you apply.
Sign up for main airline and hotel reward programs in advance
The main reason is that instead of using Chase or Amex portal to book hotel or air tickets, it is better for various reasons to transfer points to the airline/hotel loyalty programs and book direct. So this means at some point in the near future, you will need to complete the point transfer. It is faster to transfer points to an old account vs a newly created account i.e. you will see the points in the airline/hotel account faster.
Hence, it is better to sign up for the main airlines and hotel chains’ loyalty programs early. They are all free to sign up. Specifically, sign up for all of the major hotel chains like:
Last but not least, I recently created this group on Facebook called Asian Expats in the US so that we can share/discuss more tips directly. Feel free to join.
That’s all from me for now.