Menu Back

Learn All Things YNAB

How Much Time Do You Have?

Free For 34-Days, Then $4.17 a Month*

On average, new budgeters save $600 by month two and more than $6,000 the first year! Pretty solid return on investment.

Sign up for a free trial today!

No credit card required.


Start taking control 
of your money today!

25 Nov 2013

How to Flush Half a Million Credit Card Points Down the Toilet

Below Read More
by Jesse Mecham

Small business owners may have a similar problem.

I run virtually all of our business expenses through a single credit card (well, now two cards, but you’ll see why in a moment). YNAB has run-of-the-mill expenses for everything from servers, to remote Mac hosting, to our customer support and emailing system. We also run ads on various networks that contribute positively to the bottom line.

This single credit card ends up with tens of thousands of dollars of spending on it each month. That spend is paid in full, the cycle continues, and points are accumulated. Lots of points.

When I first set up the card years ago, I elected to go with a Chase Amazon Business Visa. It gives me three points for dollars spent at Amazon, two points for dining and eating out, and one point for everything else. Or something close to that at least.

These points aren’t cash. They aren’t on the budget. They’re “free,” and recently I came to the realization that I was not “stress testing” these points purchases much at all.

Amazon, those sneaky devils, makes it very easy to spend my points. When I’m checking out, they’ll ask me, “Want to just use your points, you savvy shopper?!” And I would respond something to the effect of: “Hrm…then this doesn’t hit the budget! Free baby!!”

(Not having it hit the budget meant it wasn’t subjected to the Julie Test of Reasonableness, where Julie basically susses out in a few seconds how reasonable my purchases are.)

To give you an idea of how I spent my credit card points in 2013, I present to you this unfiltered list:

That was all before January 15th of this year. I had set a goal to ready 72-hour kits for my family. Check.

Oh, what, were you getting bored? The list continues:

That last purchase took place on September 17, 2013. About the time I had my epiphany:

I guard cash like a hawk, but spend points like I’m Paris Hilton.

I didn’t price-shop, I didn’t scrutinize to near the degree of a normal purchase, I didn’t sanity-check it with Julie…I didn’t maximize the value of those points.

So I converted the points to cold, hard cash, deposited that cash into the bank account, and let Julie have full control of it (here’s the podcast where I talk about giving her full reins on the family budget).

It’s being put to good use.

I also signed up for a Fidelity 2% Cashback card and am running about half our monthly (non-payroll) business expenses through there. The awards are deposited directly into a Fidelity brokerage account, where I’ll invest the funds accordingly. I guarantee I won’t withdraw from that account.

My hope is that the vast majority of you do not run that kind of spend through your credit card; at least not for your household! But if you’re a small business owner, and you find yourself accumulating an unholy amount of points on your cards, are you guilty of similar thinking? Where the points can be flushed down the proverbial toilet, and avoid the normal checks and balances of an equivalent purchase?

For those with a significant amount of points racking up, I think you’d be well-served to convert to a cashback card, where the cash can be accounted for and managed…more appropriately.

Your Next Step

Remember, budgeting is not restrictive. You won’t be spending less, you’ll be spending right. You can do this! Today. Right now. What do you have to lose? Except all that debt and stress. (Ok, so kind of a lot.)


We send one email a week summarizing all the best budgeting reads.

No thanks


Follow YNAB to get support and lots of great ideas on budgeting