Worth the miles/points if...
 

Would it be worth the miles/points if I charge $25K for my child's tuition on a CC if the fee is 2.99%?

My first instinct is NO WAY, but on the other hand, I will be paying if off when the statement is due so it's not the interest just the upfront fee I'll have to pay.

Will it be worth it for the AMEX points? The CO Flex EQMs? The BA 2-for-1?

Any thoughts would be greatly appreciated. TIA.

Personally, I won't do it. Back when my grad school didn't impose so called 1.75% "convenience fee" on tuition charges, I had used CC all the time for "free" miles every semester. Ever since the school started charging 1.75% for it, I stopped. Not to mention only MC and Discover were accepted.

Depending on your situation, some justify the fees associated with charging rent/taxes/tuition. But I'd highly doubt a 2.99% charge is worth it. Read this master thread on rent/mortgage/tuition and see how it works out for you:

Miles for Rent/Mortgage/Tuition?

What cards are accepted by your kid's school? Not sure which miles/points card you would use to get those miles, but you think getting those miles by such rate (2.99¢ per mile) is a good deal to you?

Let's do some math here. Your $25K charge earns you 25K miles, meaning a US domestic tix: $25000X.0299=$747.50

So would you pay $747.5 for a domestic tix in coach? Even though the fuel charge and tix price is skyrocketing this summer, I imagine a savvy FTer can fly better, if not farther, with $747.50 cash. ;)

no, not at 3%. personally I likely would at 1%, perhaps 1.5%, but not much more than that. I would (almost) never redeem miles for a domestic coach ticket (or any award that I can't get 2c/mile)...so I would look at it as would you pay $3,000 for a business class ticket to Europe (100k miles). I would for $1,000 (1%) or perhaps $1,500 (1.5%) but beyond that probably not. But then again I earn a decent amount of miles from regular spend so I'm not looking to "buy" miles. So it's really quite subjective.

I think it only makes sense if you need to meet a spending threshold you wouldn't already meet on the credit card, and meeting that threshold is fairly beneficial. For example, if you had the BA card and did not spend enough normally on it to meet the $30,000 companion pass threshold, it could be worth it to put all or some of the cost on the card if you are able to use the miles you receive and companion pass effectively. Most other bonus thresholds (like status with certain cards like the Hilton or SPG) is probably not worth the premium, in my opinion. If you are not trying to meet a threshold, spending 3 cents per mile is not cost effective, you can buy miles directly for cheaper (and if you aren't doing that already, then this is not worth it).

If you spend $30k in one year with the Amex PRG, you get abonus of 15k. So if you put another 5k in gas/groceries/airfare at 2x points that you'd spend anyways, you'd get 50k points at the CC fee of $750 plus additional 5k in spending.

That's 1.5c/point in the best case - not worth it.

If you signed up for 2 Amex SPG offers @ 10k plus 15k after 15k spend (either one personal + business, or one for you and the spouse) and you could split the purchase with two credit cards, you could potentially get 55k SPG points at $750 plus another 5k in spending.

That's 1.4 cents/SPG point, which IMO would be worth it. Or to put it another way, 48k SPG points can put you up at the Westin Times Square for 5 nights which would normally cost $1500.

It'd only be worth it if you stacked the purchase with a new CC signup bonus and needed to meet a minimum spend requirement, or perhaps for the BA companion pass depending on your travel patterns.

If they accept Amex cards, you can buy an Amex GC using BigCrumbs (with a 1.6% rebate), effectively reducing the convenience fee to 1.39. At 1.4c per mile, I think that's very acceptable especially if you are meeting a spend threshold.

Redeemable miles only, no. You can buy the miles at most airlines for less than that and buying miles is rarely a deal. If there is something else at stake, elite qualifying miles or a spend level it becomes more grey.

better to pay tuition in dollar coins ;)

i would lol

Thanks all for your thoughts...
 

Thank you all for taking the time to post. I think I won't pay with CC after all. I appreciate the explanations on why it's not a good idea and why it's very subjective. Will have to check out Big Crumbs though...

see I love that. If THEY are so obtuse as to charge a fee for $25,000, they WE should be able to 'get back at them' by coining them hahaha

and if worse comes to worse, you could deposit them and then hand them bank-wrapped stacks of new ones lol

or money orders or a check

If you value the WN Companion Pass as highly as I do, and need the spend on the WN Visa to get there, IMO it's worth it.

Re. coins...I have two children meaning two tuition to pay for...can you imagine wheeling in $60K worth of coins?!? On the other hand...that'll be 60K additional points/miles...the fact that I'm even thinking about it...darn you FT for getting me hooked!

But with the $1000 per ten day limit at the mint, it would mean holding onto a lot of coins to accumulate enough to make the tuition payment. You'd miss out on the opportunity cost of that money (at minimum, the 1.5% interest you could get at an FDIC insured money market account).

Yeah, I know there are ways around the mint ordering limits, but even so, you can't come up with $60k without some lead time, and that would incur holding cost.

You're right, gnat_, I wouldn't do coins. I've read some informative threads on coins, but it won't work for me.

Actually, I should say I've read some informative threads on just about everything here on FT. I discovered FT not too long ago and have I learned a lot from fellow FTers - you all are so generous about sharing knowledge/info!

I am hooked, not on coins...hooked on accruing points/miles! For instance, now instead of paying for purchases on Amazon.com with my AMEX, I go to the grocery store and buy Amazon.com GCs and get twice the points, then I go online and pay for my purchase with the GCs. I make Mr. love2ft buy his Peets/Starbucks cards at the grocery for the same reason...hey, it adds up, right?