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Living with credit, Rewards

Millennials reap latest perks in credit card rewards wars

Kelly Dilworth

Millennials with excellent credit and newly acquired spending power are benefiting from a surge of rewards and perks that cater directly to their lifestyles and preferences – including hundreds of dollars worth of free travel credits, supersized sign-up bonuses and targeted rewards programs.

As card issuers rev up competition for new customers, they’re increasingly targeting affluent, value-conscious millennials who can afford to drop several hundred dollars a year on premium card annual fees in exchange for amped-up benefits.

Just last week, Chase announced an unprecedented promotion for new homebuyers that awards an eye-popping 100,000 bonus points – worth up to $1,500 in free travel or other rewards benefits – to any Chase Sapphire cardholder who takes out a home loan with Chase Bank.

In a news release announcing the offer, Chase said the bonus was intended, in part, to appeal to millennials in their 20s and 30s who are just now getting ready to trade in their rentals for more permanent digs.

“We designed this exclusive mortgage offer for our Chase Sapphire customers to reach a new wave of homebuyers,” said Chase’s Amy Bonitatibus in a statement.

“Half of Chase Sapphire customers are millennials, many of whom are looking to buy their first home now or in the future,” added Chase’s Pam Codispoti.

Meanwhile, American Express recently revamped the benefits on its marquee premium rewards card, the American Express Platinum card, and added a number of millennial-friendly perks, including enhanced hotel and air travel bonuses and $200 worth of annual Uber credits.

According to the New York Times’ Charles Duhigg, the upscale card issuer retooled the Platinum’s card rewards program in an effort to fight back against the perception that it’s losing young, affluent customers to hipper rivals, such as the Chase Sapphire Reserve card.

“Amex, like all credit card companies, desperately needs new customers each year, preferably ones with decades of spending ahead of them,” wrote Duhigg. “Hence the focus on millennials.”

U.S. Bank also entered the super-premium rewards fray this month when it launched the Altitude Reserve Visa Infinite card. In a clear bid to appeal to tech-savvy millennials, the new card offers an unprecedented 3 points for every dollar spent on mobile purchases as well as an array of free perks and exclusive benefits.

The mobile spending bonus isn’t likely to benefit cardholders who live in smaller cities and rural areas where retailers who accept mobile payments are scarce. But for young trendsetters who live in major cities with U.S. Bank branches, such as Los Angeles and San Francisco, the uniquely generous bonus offers a huge opportunity for racking up points – particularly if Altitude Reserve cardholders use their card for every possible purchase.

Even fee-free cards are ramping up benefits and offering increasingly generous bonuses. The Wells Fargo Cash Wise Visa, for example, recently increased its sign-up bonus to $200 – a rare benefit for a card with no annual fee. Most no-fee cards offer new cardholders just $100 to $150 as a sign-up bonus.

As a millennial myself, the uptick in super valuable offers has been hard to resist. When the Chase Sapphire Reserve card launched last year – prompting the latest craze for high-value super-premium rewards cards – my husband and I jumped on the opportunity almost immediately.

Although we had never spent a dime on credit card annual fees before, we had no trouble dropping $450 for my husband’s Sapphire Reserve card. The math was a no-brainer.

After spending $4,000 in the card’s first three months on groceries, supplies, travel and gift cards for future supply shopping, we earned the card’s then-100,000-point sign-up bonus (since reduced to 50,000 points) and used that, along with the card’s $300 annual travel credit, to recoup the cost of the annual fee and pay for multiple free trips.

Like many millennials I know, I’m not very interested in flashing around a prestigious-seeming card or belonging to an exclusive club of credit card holders. But I do have a hard time passing up a good deal – especially when the perks are so substantial that a high annual fee feels like a drop in the bucket in comparison.

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