Triple-dip using Shopping Portals for Online Purchases

Up until now, I’ve posted several blog posts focusing on cheap travel and credit. Those posts are probably for a specific group of people that like travel. This post is for anyone--even if you don't like travel. I'm talking about how to get extra cash back or travel points on normal things you buy online already.  This is a triple dip deal! I’ll explain. ***cool over 50% savings story at the end***

Shopping Portals

I’d like to share something, that you may already know about, called “Shopping Portals.” The way it works is that there are websites that will give you a reward for clicking through their website to an online retailer and making a purchase.

Example: Let’s say you wanted to buy a shirt at Macy’s department store that costs $30. Search for “Macys” on Topcashback.com after signing in. It currently offers 8% cash back on purchases at Macy's. Click “Get Cashback Now” and it will take you to macys.com where you can shop and checkout as usual for your $30 shirt. Afterwards—assuming things work smoothly—you’ll get an email saying “You have just earned cashback at Macy’s.” Your cashback will be pending for several weeks—then you can transfer your $2.40 back to your bank account.

Why do shopping portals exist? 

Online retailers give bonuses to other sites for driving web traffic to their sites. This is big money for them and they are willing to give a cut of the $$ away for it. It just happens that these shopping portal sites send some or all of the money they get from the retailer on to the customer as they can make money in other ways too.

There is big competition for this space. Check out all the different cash back and loyalty programs that are trying to get in on this just for macy’s department store.

There are tons of online retailers that participate in this system. The bigger the retailer the more it seems they get in on it: Amazon, Nordstrom, Macy's, Best Buy, Overstock, Ebay, Walmart, Target, Home Depot.

One of my favorite sites to look up cashback information, called cashbackmonitor.com, boasts 10,000+ online retailers internationally and 43 cash back or travel points programs.

Cashbackmonitor.com is how I optimize my return for online shopping expenses. The way you use cashbackmonitor.com is to look up the retailer at which you want to shop and see which of the 43 rewards programs offer the best cash back or miles for your online purchase. When you click through cashbackmonitor you are sent to the shopping portal site and then you can click through to the retailer to shop.

As you many have noticed, I like the chance to get miles and points for travel and this is a great way to do that. I think my favorite rewards program is Chase Ultimate rewards (you get these if you have a Chase credit card, like Freedom, Sapphire Preferred, Ink Plus, Ink Bold, Ink Cash, or a couple others). I like them because you can get cash back or you can transfer the points to a variety of travel programs like United, Hyatt, or Amtrak. Chase has a shopping portal too.

Triple Dipping is super awesome!

Mostly I love this because it gives me a big opportunity to get a triple dip at different online stores. Here’s how: Let’s say there’s a sale for 20% off at Macy’s (which happens monthly it seems). This is dip one, a discount from the retailer itself. But on top of that 20% off you can get an additional 8% off by going through the shopping portal (dip two) and another 2% back using a no-annual-fee cash back credit card like Citi double cash or Fidelity rewards card (dip three).

In the end you could be getting about 30% off! And all this while other people are just getting the 20% off and some people are even paying full price. The savings seems to amplify on larger purchases too.

Here’s a real-life example from this past week. I found 2 pieces of furniture on a design site called Dot & Bo and cool a 10% discount there! When I had settled on the items I wanted to order, I decided to search the interwebs to see if there was cheaper price from any other online retailers . After finding the exact same items on Overstock.com for a cheaper starting price I used these tips to get an even deeper discount. I used a discount coupon Overstock had emailed me, a shopping portal and I choose the right credit card to reward the purchase, here’s how the numbers worked out:

That’s a 54% savings on the price I was willing to pay at first for these two furniture items!

Explanation: On Overstock, the exact items were $350 cheaper than Dot & Bo. My Chase Freedom card earned 5 Chase Ultimate Rewards points per dollar at Overstock. Shopping Portal earned 4 American Airlines AAdvantage Miles per dollar and I earned a shopping portal bonus of 2250 AA miles as this brought me over $700 at Overstock. Overstock rewards gives you 5% back to use at Overstock.com but costs 14.95 for a year- the savings were well worth that cost.

Isn't the Dr. pretty great at this stuff?? He's got me using shopping portals for everything I buy online now- clothes, beauty products, home and everyday items. There are usually better sales with online retailers and a wider selection of items at the stores I love not to mention online shopping is so convenient!  Please leave comments or questions below and I will make sure the Dr. is in to answer them!

Understand your Credit. Don't Fear It!

Another great post from the Dr. today, all about credit scores. Also, can you see how tan my legs were in the picture below?? Oh, to live near the sea again.

Probably the best return on my time & energy for free travel has come about from signing up for and at some future time closing new credit cards. But, I think some people have fears about that and its effect on your credit score.

Sometimes our choices related to credit are done out of fear.

A Story

I was getting my hair did at a stylist last week. She does a great job. Like, I won't go anywhere else in the area anymore. We always chat about travel in the chair and she mentioned that on a recent US Airways flight they advertised a credit card over the PA system. I know which one, cause I have it. I've been there before too—US Air does all this lame advertising to their captive audience during flights. But oh well they're cheap.

Back to the story. She said she was thinking of signing up and didn’t. Just then, someone else took a pamphlet and signed up. She just kept telling me how they shouldn’t do that kind of thing and ruin their credit.  Since she took a strong stance, so I didn’t respond to her comment, but I think this is how people think.

Now I’m not saying that people SHOULD sign up. You probably shouldn’t if you overspend, can’t responsibly pay the bill on time, just applied for other cards, want to simplify life, or any number of reasons—it’s a matter of being honest with yourself. But, I am saying that if your only concern is how it will affect your credit score, then maybe you should read on.

Your Credit Score

Your FICO credit scores are generated only from information in your credit report. Credit reports come from the 3 credit reporting agencies: Experian, TransUnion, and Equifax. Most creditors don’t pull all 3 reports when you request credit, but some do (notably CapitalOne cards do). FICO is a company with a complex, proprietary scoring algorithm. Since it’s popular, I’m sure they make lots of $ on their algorithm. Scores range from 300-850.

Here’s a breakdown of how different aspects of your Credit Report factor into your FICO score.

Image from MyFICO.com

Percentage	What	Description
35	Payment History	Shows responsibility for paying accounts on time
30	Amounts Owed	Total statement balances divide by Total of credit limits
15	Length of History	Average age of accounts. Good to keep old accounts open
10	Types of Credit	Real Estate, Installment Loans, Credit Cards. Good to mix
10	New Credit	Inquiries impact for 1 year. Lower impact after 1-3 mo.

From www.experian.com

What happens when you apply for a credit card?

When you fill out an application online or at a bank or online, the bank does a hard pull on your credit file. This is called an “inquiry.” I have been able to confirm what several other points bloggers have noted this type of inquiry does reduce your credit score by less than 10 points (blog 1: 2-8 pts, blog 2: 3-11 pts). Technically inquiries fall off your credit report (and hence affect your score) for only up to 1 year. However, from my own history, it appears that the lifespan of the credit “hit” is really 1-3 months.

If the application is approved, then other changes will show up in your credit score. First, you have a new card that is 0 months old. This new card will now be factored into the average age of credit lines. This is another potential place where a credit score could be reduced especially if you’re just starting to use your credit.

Second, your credit score will be increased because you have a new amount added to your total credit limit, while there is no balance on that line yet. The result is a lower credit utilization rate. In my experience, this usually ends up increasing my credit score.

Another Story

Several years ago (probably 2006) I opened a bank account with Key Bank because they offered a free iPod nano for opening a new checking account and a credit card with Lock Bank (name changed to protect the innocent). This is when iPods were the coolest possible thing. I read the offer and it basically said I had to have $100 in the account for 6 months. So I opened the account and met the requirements. Then, I fought to get my iPod, since they later argued that they never had such a promotion. I ended up with the iPod. Finally, I called their service desk to close my account. Their “retention” department told me to be careful and read me a thing about closing accounts and warned me that it could affect my credit. 

The fear built up inside of me. “Oh no! I might ruin my credit. And I’m so young! I might never get a home.”

With a portion of truth, it was a lie. It was a lie to get me to keep my account open.

Like most people I didn't actually know how credit files worked. First of all, bank accounts that are not credit accounts are not reported to credit reporting agencies. So having a debit card with a visa sticker on a checking account will not do anything to your credit. Secondly, although opening and closing accounts does have an effect, the effect is very limited and most importantly, it can be understood before closing

What happens when you close an account?

When you close a credit card it will only impact the last two factors—Credit utilization and average age of accounts. Here’s how to avoid dropping your credit score when you close an account:

Don't close your oldest accounts. If you're not using an account, you don't necessarily need to close that account. If you're just starting out using credit, open “no annual fee” cards so that when you keep your oldest card open forever it won't cost you anything. Remember, the average age is the only thing that matters here.

Credit utilization will go up when you close an account because your total of all credit limits will go down. One thing you can do when you close an account is to call your card company. If you have multiple credit lines with that bank, consider moving most of the credit line to one of your other accounts—like a no-fee card. That way your credit utilization rate and score won’t move.

That’s it. There is no more mystery. Now you don’t have to be afraid of opening and closing accounts.

The Rest of the Story

So I need to finish my story…

Even though I was initially afraid of what the phone rep told me, my B.S. detector was going strong. I closed my account with the Lock Bank. I had an iPod nano and it was awesome. Now it’s in a box somewhere. Want it?

How my FICO score has varied

So everyone’s experience will be a bit different. But I can speak from experience. Here’s a snapshot of my credit score over time. (This is via creditsesame.com)

I don’t have a problem sharing this with you. Part of the reason why we fear this credit-related items is because it’s taboo to talk about. It is not a competition. When no one communicates, knowledge isn’t transferred and the banks win. 

What I'd point out is that all of the stronger dips are months where I applied for 1 or 2 cards this year. The result was minor impacts on my score and a rebound within a couple months. In December, I closed an account and opened 2. The January score reflects that.

Note: Credit Sesame doesn't use exact FICO scoring—it’s their best guess pseudo-score and it shows trends just fine. I think it tends to give me too high of a score compared to real FICO scores. No matter. The point is to see the trends.

For reference here are my current FICO scores (they come free with some credit cards)

TransUnion FICO Score from Barclays Bank

Equifax FICO Score from CitiBank

Thanks for another great post, Thomas! If you have any questions please leave them in the comments below and I'll have the Dr. answer them.

How We Made Our Europe Trip Affordable -- Hotels

Hey ya'll! The Dr. returns to give another update about using miles and points for our trip to Europe. Spoiler alert: we stayed in some dreamy places!

Hey I’m back again to write a little more about our trip to Europe. If you didn't catch my first post about How We Made Our Europe Trip Affordable -- Flights you should check it out.

During our trip we were in Europe for 14 nights and we stayed in some amazing places!

Let’s get to the trip! To be equitable, we split the trip in half. Sarah planned the locations of the first week of the trip and I planned the second. This was Sarah’s first trip to explore Europe. She served as a missionary for our church in Southern England but didn't get to see much of London itself. Sarah was so excited and wanted to see Paris, London, and visit some friends from her mission in Western England. I wanted to relax in Nice and also check out Barcelona.

Here’s a little chart showing our location and how many nights we needed in each location.

Location	Nights in that Location	Hotel Nights Needed
Paris, France	2	2
London, UK	2	2
Western England	3	0
Nice, France	5	5
Barcelona, Spain	2	2

Starting from nothing, we needed to get 11 nights at hotels. It seems impossible but, you know what? We did it! And basically for free!

View from our room at Park Hyatt Paris Vendome

After studying several of my favorite travel blogs (Million Mile Secrets is a favorite), I discovered that credit card sign-up bonuses offer probably the greatest value for getting free travel. After understanding how my credit score works, I decided to take this approach to get free stays for this trip.  (Follow-up: Both Sarah’s and my credit score are now much higher than it was last year before applying let me know if you are interested in me writing a post about how your credit score works)

For the hotel stays for this trip, we signed up for a total of 4 credit cards. All four of the cards have an annual fee, however the fee is waived for 3 of the 4 cards in the first year. Here is a list of the cards and their sign-up bonus at the time:

1. Chase Hyatt Visa- in Sarah's name: 2 free nights at any Hyatt hotel (+2,000 Hyatt points after minimum spending requirement)
2. Chase Hyatt Visa- in my name: 2 free nights at any Hyatt hotel (+2,000 Hyatt points after minimum spending requirement)
3. USBank Club Carlson Visa: 85,000 Club Carlson Points & 2^nd Night Free points stays (+15,000 Club Carlson Points after minimum spending requirement.
4. Starwood Preferred Guest American Express: 30,000 Points (+5,000 SPG points after minimum spending requirement)

Every Point Currency has a different value and redemption rate at different hotels. This is how I redeemed the points I got from the credit cards we opened. I also used 16,000 additional Chase Ultimate Rewards points converted to Hyatt points for this trip.

Location	Hotel Brand	Hotel Name	Nights	Points Cost	Cash Price
Paris, France	Hyatt	Park Hyatt Paris Vendome	2	2 Free Nights	$2,584
London, UK	Carlson	Radisson Blu Edwardian Mercer St	2	50,000 Club Carlson Points	$910
Nice, France	Carlson	Radisson Blu Nice Cote d’Azur	2	50,000 Club Carlson Points	$1,380
Nice, France	Hyatt	Hyatt Nice Palais de la Mediterranee	2	2 Free Nights	$1,112
Nice, France	Hyatt	Hyatt Nice Palais de la Mediterranee	1	20,000 Hyatt Gold Passport Points	$556
Barcelona, Spain	Starwood	Four Points Barcelona Diagonal	2	14,000 SPG Starpoints	$530
		Totals	11		$7,072

I got about $7,000 of value out of the 4 card sign-ups and I had 16,000 SPG points leftover. Note: We did pay about $100 over the 11 nights for room taxes and upgrades.

Common-Sense Check: I would never pay cash to stay at a place that is $1300 per night. So, I looked up hotel costs and by choosing the cheapest economy hotels available I could have done the trip for a little over $2,000 + tax in hotels. With points we were able to stay in some of the nicest & newest places in Paris, London, Nice, and Barcelona rather than the cheapest. And we always felt safe and comfortable which definitely has it's own value. I estimate the true value we would have spent on hotels this trip would be somewhere in between $2k to $7k.

Here are some highlights from the hotels we stayed at:

Our Room at Park Hyatt Paris Vendome

The posh bathroom at Park Hyatt Paris Vendome

Radisson Blu Edwardian Mercer St at the Seven Dials in Covent Garden

View from our room at Radisson Blu Nice Cote d'Azur

Radisson Blu Nice also had a cool Rooftop Pool! And we had Super Expensive Virgin Pina Coladas

Hyatt Nice Palais de la Mediterranee during the Day

Hyatt Nice Palais de la Mediterranee at Night
The breathtaking Cote d'Azur is directly behind you as you look at the hotel

View of Sagrada Familia at Four Points Barcelona Diagonal

Bidet first-timer! It was pretty nice. 

Sarah at Parc Guell in Barcelona

Our three nights in Western England: If you know someone in a place you plan to visit, consider asking to stay with them if it’s not too much trouble. Sarah had some amazing friends from her mission to England. They were so friendly and generous with their space for 3 of our nights in Europe. We stayed with the Taylors in Torquay and with the Smuteks in Melksham. The Smuteks even let us do a load of laundry at their place which allowed us to pack very light- each of us took just one carry on bag for the whole two-week trip.

I hope we were good houseguests to them. We love having friends stay with us, so hopefully we can return the favor to these folks someday.

If you have any questions about the process of opening credit cards or it's effects on your credit score, booking hotels with points or anything else please leave a comment!

I have to say that when the Dr. first came to me with the idea to do a trip to Europe and not really pay for it I was very skeptical. After staying at some of the most posh hotels I have ever seen I am a huge believer! It does take time and research to make it happen but this trip was a dream come true thanks to the Dr.'s willingness to put in that hard work.