Paying Bills with Credit Cards to earn Travel Points

June 27, 2024

Question:

I have been reading about people paying their rent and taxes with their credit card for the travel points. Is this a good idea?

Answer:

While everyone’s circumstance is different, in general it is not a good idea to pay rent or taxes with a credit card.

  • If you do not pay your credit card bills in full every month, it is not worth accumulating points on a travel credit card.

  • There is often a roughly 3% fee to pay bills like rent and taxes with a credit card. That’s a high bar to make the points “pay for themselves”.

    • Caveat: many credit cards incent new customers with a huge points bonus when they spend a certain amount in the first 3 or 6 months.

  • If you need to charge rent or taxes to earn the bonus and you pay your credit card bill in full every month, then there may be a benefit.

For more information, here is an article from the Wall Street Journal that I found on the subject.