« Reply #53 on: October 24, 2011, 03:30:12 PM »
Actually the breakeven is more like $1,900 in grocery spending assuming you get 2% cash back equivalent on other cards (SPG or Freedom, etc)
The not getting 6% at Costco is what really hurts though as groceries at Costco are probably 30% cheaper than at a grocery store.
Where is my math wrong?
To "make back" the $75 AF, you spend $1250. However, the opportunity cost of spending $1250 on the BCP is losing the $1250 of spending on a 2% CB card, i.e. one would lose $25 (1250 x .02). Thus the real annual cost of the BCP would be $100 ($75 AF + $25 opportunity cost). Therefore, why wouldn't the breakeven point be $1667.67 (1667.67 x .06 = $100)?
EDIT: Nevermind.
« Last Edit: October 24, 2011, 03:33:27 PM by AJK »
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