100,000 Free Hilton Points for Separating Military and Spouses + What To Do With Annual Fee Waived Cards When You Leave the Military | Military Money Manual Podcast Episode 28

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Listen to The Military Money Manual Podcast on Spotify, Apple Podcasts, Amazon Music, Audible, YouTube, or Stitcher.

The Hilton Honors Military Program offers separating military servicemembers and their spouses up to 100,000 free Hilton points each to aid veterans and their spouses in searching for their next job or establishing their new life. These points can be used for a job hunt, interview, conference, or any other purpose to establish your foundation after the military. This is a separate and complementary program to the Amex Hilton Honors Aspire annual fee waiver program.

If you've been opening up travel credit cards for a long time, chances are you have accumulated many annual fee waived cards like the Chase Sapphire Preferred and Amex Platinum. If you're separating or retiring, what should you do with your credit cards when you leave the military?

If you're just getting started on your military travel credit card journey, check out the Ultimate Military Credit Cards Course. It's 100% free and only takes a few minutes a day to read through the material. I will send you an email every day for 5 days. Unsubscribe at any time, I promise to never send you any spam.

In this episode Spencer and Jamie talk about the Hilton Honors Military Program, how to use it, and how to earn the free 100k points.

We also discuss if you should close, downgrade, or keep your credit cards after you get your DD-214 and separate or retire from active duty. The answers may surprise you!

Military Money Manual Podcast Episode 28 Transcript

[00:00:00] Spencer: Welcome to the Military Money Manual podcast.

[00:00:08] Jamie: Hi there. I'm Jamie. And I'm here again today with Spencer from the Military Money Manual, the author of the new book and the owner of the website and all that goes with that. All the goodness there. 

Today, we're going to be discussing two great tips for those who are approaching the end of their service, whether retiring or separating from active duty that I think will be very helpful to you Spencer, what are the kind of the two highlights of today's topics?

[00:00:36] Spencer: So the two takeaways. For today's topics are one, if you're separating from the military, either retiring or just getting an honorable discharge after completing your service, you are eligible and your spouse as well for a hundred thousand free Hilton honors points. And we'll get into the details of how to earn those, but this isn't connected to a credit card.

This is just a great program that started a couple of years ago where Hilton is giving out a hundred thousand free points to military service members to help them transition out of the military. So we'll get to the details on that in just a minute. And then the other thing that we're gonna be talking about is what to do with your annual fee waived credit cards after you get out of the military.

[00:01:17] Jamie: Some good topics there for sure. Especially the second one. People ask that a lot. And anytime you talk about military travel, people always, but what about the, when you get out of the military or whatever? So I look forward to talking about that one. First Spencer, let's talk a little bit about the Hilton honors military program that you mentioned, which is an incredible benefit to help service members, like you said, either retiring or separating from the military to basically look for a new job or attend training or anything along those lines. Tell us about that program.

[00:01:46] Spencer: Yeah. So it's a partnership between the Hilton Honors, the Hilton hotels and the national association of state workforce agencies. I never heard of them before. I think essentially they're there, maybe they might be in charge of things like unemployment benefits or helping vets find work but it's a nonprofit.

And they partner with Hilton, the NASWA, and you can go to their website and naswa.org to find more details on the program, or it's on my website as well. If you just Google Hilton honors military program and they offer a hundred thousand points to transition service members and veterans to help support their travel for employment.

The terms of the program or the points can be used for any employment purpose, such as an out of town job search training for a new job or finding housing after separation. And as of December, there were 27, December, 2021, there were 27 states participating, but I just checked the website today in mid January, and now there's 28 states participating.

So it sounds like it's a growing program. And I wouldn't be surprised if within a couple of years, almost every state is participating.

[00:02:52] Jamie: Even better. What's the process like to sign up? How difficult is it?

[00:02:56] Spencer: So from what I hear it's not too bad. You do have to go through a little bit of a process.

You can start my website, militarymoneymanual.com. I've got the article up there and you're going to have to reach out to a point of contact with the national association of state workforce agencies. And there's a couple of email addresses on there, just find your state, whether you're in Texas or California, wherever you are in New York, and you just email your point of contact.

And you tell them, Hey, I'm a US military veteran, or, Hey, I'm separating in a couple of days, a couple of weeks. And I'm curious about the Hilton honors military program. How do I get a hundred thousand points? And they're going to respond with a couple of questions. You're going to have to give them your Hilton honors number, obviously, so they can post the points.

They're going to ask you where you're currently located, where you're traveling to some of the other interview questions. Or is this request to attend a specific employment event, like an interview, training, or housing? If so, where and when is the event? How many Hilton points will be required for the event?

The max is 100,000. And they'll probably ask to see your DD 214, which is the document you receive when you separate from the military. Or they might want to see your separation orders if you don't have a DD 214 yet. Because you haven't separated yet. So if you're in that transition period, maybe 180 days of separation.

[00:04:22] Jamie: Yeah. So I know we have several friends where you actually have to get orders to separate. And so it's not something you can do necessarily too early. So this might be a little later in the process and you may have already done the bulk of your house hunting or job search trips by this point, but what an incredible benefit.

And like you said, on your website, you have the list of. Contacts to reach out to, and then you basically just have to start an email conversation with them earlier. Spencer, you mentioned spouses too. Can you expand on that a little bit? Spouses are also eligible in addition to the service member.

[00:04:58] Spencer: That's right. Yeah. So I've gotten several data points about this. There's nothing official on the website, and this is why, having this community around the MilitaryMoneyManual.com and the newsletter and the book is just so great because you get all of this information that isn't publicly available.

And I don't know why they don't put this out there, but I've had several people who are separating in the next couple of weeks or months, reach out to me and say, Hey my spouse was also available for this program. So maybe it depends on the state and maybe that's why they don't publicly talk about it.

But make sure you inquire about that. When you, the active duty service member apply for the point, just say. Is my spouse eligible for this program as well? And I've gotten at least two or three data points now where people, the active duty service member received a hundred thousand points and then they've said, Hey, my spouse is gonna be traveling too, to find new employment after I separate.

And then the spouse gets a hundred thousand points. So potentially you could earn 200,000 points if you're a married military couple. So once again, the married military couple benefits from a military program.

[00:06:05] Jamie: Yeah, but it doesn't even have to, it doesn't sound like it has to be necessarily like a mil to mil relationship.

I just looked at this line on their website that says the Hilton Honors military program provides a hundred thousand hotel points to eligible transitioning service members, veterans, even. So I don't know if there's a time window there. I'll come back to that in a second, military spouses and other eligible persons to support needed travel for verifiable employment related activities, like you mentioned before.

And it is once per lifetime. So a hundred thousand per lifetime. And each participating state sets its own eligibility and residency requirements like Spencer mentioned already earlier, there's a, there's one even testimonial here that talks about a retired Marine veteran spouse that used their Hilton honors points to accept a new professor position at a local university, and then they use their rewards points towards a few nights of house hunting.

Pretty cool. To see all that. I've never heard of this Spencer before you published your blog a couple of weeks ago, is this a new program? Do you have any history on it?

[00:07:07] Spencer: It doesn't appear to be a new program. I can find a couple of blog posts from 2015, I think in 2016, where people have also talked about this program.

It just doesn't seem to be very widely known about. And, I just went through the transition assistance program myself, the TAP course. And this was never mentioned. This is a very practical and useful benefit that, if military service members aren't being made aware of, that's a shame because, I'd be, it's very, I'd say it's a very small percentage of people who get out of the military and stay in the exact same location.

Where they were stationed, a lot of people moved home. A lot of people move back closer to family or a lot of people just move for work, which is the whole point of this program. I've got a friend who just got out of active duty in the Air Force and he's going to go fly for Delta.

He's in Washington state. So he applied to the Washington state program, got a hundred thousand points because he's going to Atlanta to go interview for his new Delta job. And he just said, it's going to be this many nights I'm staying at, this hotel and it looks like it's 50,000 points a night.

And so they said, here you go, here's a hundred thousand points.

[00:08:18] Jamie: That's awesome. Yeah. Because a lot of companies will cover your interview travel. Some of them don't, and you have to pay your own way for your airfare or hotel during your interview process and things like that. 

Question I have too, is when you talk about your state point of contact, is there any guidance for example I live in Alabama, but I'm a Florida resident?

Could I be eligible if only one of those states is available on the list or how do I know which state to contact if both of them are things like that?

[00:08:50] Spencer: I think the easiest place to start is if you reside in the state that's participating in the program, just start with that as your point of contact.

However, if you reside in a state that's not participating in the program, then just look at the list of states and find a state that you have some connection to, whether it's, I'm a legal resident of Texas. I was born and raised in Connecticut. I went to school in Massachusetts and I currently live in Hawaii.

And I think I have to update my car insurance cause it's still New Jersey, right? That's a classic military story right there of, having affiliation with six different States. And so I think whatever state you, you think that you have the most connection to, and, maybe when you apply, if they, if you answer the interview questions and they say, actually, you'd be a better fit to, to apply to the state that you're going to move to, that, that could also be.

So I think this program is designed to help veterans and they're going to find a way to get to get you these points. And whatever however you need to do it, however you need to establish that you have a connection to the state that you're applying to a state that participates in the program, I would say, go ahead and do it.

I wouldn't consider it defrauding the program as long as you have an intent to move to that state or if you're a legal resident of that state, or you reside in that state, this program is set up to help you out as the separating service member.

[00:10:09] Jamie: I found that a lot of the benefits like this are so underutilized or poorly advertised that when they have someone contact them, they're just excited to share. It's like when you go to the library and you ask them a question, you just made their week, right? Because no one ever talks to the librarian and like I was on this bench a couple of weeks ago, I went in and requested a book.

And they were super excited. I like, I literally had three librarians call me over the next week to ask me questions about the book and why I wanted it and all this stuff. I just, no one ever talks to them. And so I think they got really excited. So I feel like the guidance might be a little vague to give them the wiggle room.

And obviously I'm not separating, so I haven't seen that yet, but what a cool program. Are there any other hotels that do this that you know of? Have you heard anything else?

[00:10:55] Spencer: No, I, I really haven't, Marriott, Hyatt, IHG, the, the big four or the big three besides Hilton, none of them seem to have this kind of program.

And if anybody knows about it, everybody's listening to this podcast and they're like, Hey, actually Marriott does give away a hundred thousand points, please let me know. And I will do another, we'll record another podcast and talk about the Marriott on the Marriott military program. But no, as far as I know, this is strictly a Hilton program.

Which, especially in the continental United States is probably one of the best programs to be running this program. They are the best hotel to be running this program because they're just, there's so many properties and even in small town America, you're usually going to find something like a Hampton Inn or some Hilton property.

Even in these small towns, in the Midwest or in the South.

[00:11:44] Jamie: Yes, for sure. You mentioned Spencer, the interview questions, and again, just to clarify, it's not like an in person interview or anything over the phone. It's just email questions and responses, right?

[00:11:54] Spencer: That's right. Yep.

So that is not a big process. It's really just so much in life. It's just making the effort. 80 percent 80 percent of it is just finding your point of contact on either my website or they update the list on the NASWA.org website. They keep that updated all the time.

And if you Google Hilton honors military program and NASW it'll pop up right away and just find your point of contact, shoot them an email. And I'm like you said, Jamie, I'm sure that, they're, these people are not, didn't publish their emails Because they don't want people to contact them.

They want veterans to contact them. They want to help you make that move, interview for that job, go to that convention. And, that's the other thing too, is maybe you have an interest in some other job that's completely unrelated to your military job, it just doesn't make sense for you to shell out a couple hundred dollars for a hotel room to go to a convention, but there's a convention, and you think, you know what, maybe I can go there.

I can learn about this job and maybe it turns out to be the job for you. And if it doesn't, then it's okay. You just spend 100,000 points and it's called a job search, right? It's not a job find.

[00:13:04] Jamie: That's really cool. And obviously the intent like you said, is to use these for some kind of job related search house hunting job training or something like that.

But there is no followup. You don't have to send an after action report of where you sent them. Don't take advantage of the system, but they also make it easy on you as well, where you don't have to account for every single point. And what hotel you spend it at.

[00:13:26] Spencer: I can't remember if it was in an email I saw, but essentially if you, let's say that you, like you get the job on the first night and you only need to use the points for one night, you get to keep the remainder of the points.

So they're not making this difficult. It's essentially 100,000 points donated to retiring, separating U.S. military service members and their spouses. And, don't feel like you're taking advantage of the program if you only use it for one night for a job hunt. The points are there for you.

And Jamie and I have been talking about it, this is not a well advertised program. So hopefully, if you found this information valuable, if you found this useful, share this on Facebook, share it on Reddit, Instagram, send it, text it. What's that bit to your friends, just let them know about this program, especially if they're getting close to getting out of the military, because I know for a lot of people, 100,000 points.

That could be three nights stay at some, Hampton Inn or Hilton Garden Inn, and that could mean the difference between, interviewing for a job, getting the job, showing up, rested and looking, looking prepared rather than driving, eight hours overnight to go interview for a job.

You can drive in the day before, stay the night, and you don't have to worry about the expense of the hotel.

[00:14:37] Jamie: So yeah, that's a good point. Put yourself in a leg up.

[00:14:40] Spencer: If you have the Hilton Honors Aspire card, you'll, which you should probably have as well if you're in the military. You're gonna have diamond status.

So you're probably gonna get free breakfast or a dining credit as well.

[00:14:51] Jamie: And maybe an upgrade too, depending on which hotel in Spencer, one thing I wanted to highlight too, and this is my last thought before I pass it back to you on this topic was, if you have used it. If you have any other data points or after listening to this podcast, you go out and use the program as a recent separating veteran or getting ready to separate, please let us know DM on Instagram @MilitaryMoneyManual, or email info@militarymoneymanual.com. We'd love to hear your experience with it so we can keep passing the feedback that it's a pretty easy program to take advantage of and make use of.

[00:15:26] Spencer: So Jamie, one Reddit post that I just commented on the military finance subreddit, which is a great resource, by the way, I don't know if we've talked a lot about that on the podcast, but reddit.com/R/militaryfinance, and it's got 25,000 active members. So created July 11th, 2012. I think I actually created it, but I can't prove this. You can't scroll all the way back. I can't prove it, but it's got 140 people on it right now, which is pretty cool. But yeah, this guy asked 

“Credit cards after getting out, I've accumulated many credit cards since being in the service. I've been quite liberal in acquiring credit cards because of SCRA and MLA. To those who have gotten out, how have you dealt with the number of credit cards you have obtained while you were in? Did you close all them to avoid the fees? Did you keep them? Did you plan, did you have a plan to shut down the cards? How did this impact your credit score? Is it worth it? Thank you all in advance.”

So lots of questions there, but basically the overall question is, what do you do with your annual fee waived cards when you get out of the military? So I wrote a Post about this a couple of years ago on my site and I think the easiest way to find it is just Google, what to do with annual fee waived cards when you leave the military or credit cards separating the military.

Let me see if that works. Credit cards separating the military. Yep, that comes up fee waived cards when you leave the military. So boom. Yeah, there you go. Google's my friend. So obviously while you're in, when you're on active duty, you're in the MLA database. You're going to get your Chase and American express cards, annual fee with the personal cards, annual fee waived for you and your spouse.

There's over 30 cards between Chase and Amex that waive. But that all comes to an end, right? When you separate. Or retire or otherwise depart the military, hopefully honorable for most of you. So should you close all the credit cards when you leave the military? 

Jamie, what do you think?

[00:17:40] Jamie: I would definitely recommend not closing them. What you want to do is think about which cards are still giving you value.

So for example, the Chase Sapphire Reserve, we talked about a few episodes ago, has the $300 travel credit, three times points earning on dining and travel. And a great rental car, primary rental car insurance. You get $300 towards travel. So it really softens the blow of the annual fee. Or if we're talking about for example, the Hilton Aspire card comes with diamond status, a free night every year, $250 resort credit, plus $250 airline credit.

And so some of those might still give you value, even if you pay the annual fee. So I would not close the cards that are still giving you value. But for example, for us, we opened the Chase IHG card to get the signup bonus, but we're not really using that. We're not really taking advantage of most of the perks of that card.

So we're, we would probably close that one. So just help give you a glimpse of the way that some cards might give you value more than others. What do you think, Spencer?

[00:18:42] Spencer: Yeah, same ideas over here. My recommendation is no. So first of all, don't like, don't just automatically close all of your credit cards when you leave the military.

Just like you said, evaluate, see where you're getting value from for a lot of the cards you're going to more than justify the annual fee. And then for other cards, you might be able to downgrade them to a no annual fee card. So like for instance, the Chase app, I reserve and that's right.

And keep your points. And that's really important. We'll talk about that in just a minute, but no, it's like for myself personally, between my wife and I, we have over 20, I think we have 29. Cards open at the moment. If we were all of a sudden to leave the military and start having to pay all those fees.

Yeah. You better believe that I'm probably not going to keep the Amex Platinums open. Yes.

[00:19:31] Jamie: You don't love Saks that much.

[00:19:33] Spencer: No, I do. I do. Actually. I do love Saks 5th Avenue that much, but I can buy $6,000. Yeah. Just go spend that. Yeah. That's right. I don't need the 50 every six month credit.

[00:19:44] Jamie: So you might cut down from 29 to maybe 2 or 3 is what you're saying?

[00:19:49] Spencer: Yeah. Yeah. I'd probably, just off the top of my head, I haven't really thought about this too far in advance. Probably should start soon. I know. I know. The Amex Platinums, I'll probably keep at least one of those open. Probably not more than one, to be honest, and maybe not an additional one for My wife as well, probably just for me and then add her as an authorized user.

The Chase Sapphire Reserve, definitely going to keep that one open. I've gotten a lot of value off of that. And another thing too, is you want to keep a card open that can transfer to travel partners, and you want to be able to preserve. Your points and miles. And then the Amex Gold card, it's got four X points on dining and groceries.

I get a lot of value out of that. Spend a, maybe I'll have to go back and see. I think last year we probably spent five figures on growth between groceries and restaurants. So that's $40,000 points right there, which could be worth what? $800 if you do two cents per point of travel.

So it's got a $4250 annual fee. Yeah. That sounds like it's paying for itself. Just take the opportunity to, if you've been in the travel game and you've been doing this for a little bit, you probably have like a running tally of what are your top performing cards and where you're getting the most value and just take a moment to, like you said, Chase IHG is only $95 a year and it comes with a free annual night.

But if you're not using it, then that's $95 a year that you're not getting value out of. 

[00:21:10] Jamie: But you can't even find a Hampton Inn quality hotel for $95 a night in most cities these days. That's true. You use it once and it could pay for itself. Now, what about the timing for this as you approach the day where.

You walk off base, put, hang up your boots for the last time. Do I need to set a reminder in my phone the morning of my terminal leave ending or beginning to cancel 26 of my cards, or is there a rush to do it the day it happens, or do you have a little bit of a buffer period?

[00:21:40] Spencer: Yeah, absolutely not.

There's no rush. And a lot of people, I think, fair enough, like they want to be proactive about it. And so you'll see a lot of people who are like months or years away from separating. They're already anxious and worrying about and thinking about it, which is good and, have a plan, but you don't need to worry about it.

And the good news is. Unlike the military these companies actually want to keep you as a customer. And so they don't have these absolutely, horrendous finance departments that are just trying to bilk you out of every dollar. No, they like they actually are going to. Chase and Amex I've had great customer service with them and they actually want to keep you as a customer.

And so before they charge you any annual fee, they're going to warn you. And this is, this breaks down between American express and Chase. There's definitely a distinct difference here. So from the data points that I've been getting through the website for years. Chase checks the MLA database essentially every month or two.

And as soon as you fall out of it, whether it, you go to the reserves, you go guard and you're not on title 10 or title 32 orders anymore. If you just leave active duty, you separate and you're, you got your DD 214 and you're a veteran now, as soon as that happens. Some people, most people report within two or three months of that separation date, Chase contacting them and usually through a letter in the mail or through an email and saying, Hi, we show you are no longer on active duty.

If this isn't true, please provide orders. So let's say you went to the guard reserve and you picked up active duty orders, then you can just provide those MLA benefits. But if you can't produce evidence that you are still active duty, then they'll say. Your annual fee will be assessed on and usually it's six to 12 months in the future.

So you're going to have plenty of warning and you're going to be able to come up with a plan for what you want to do with your cards. And so that's Chase. And then on the other side is Amex. And here's a little tip from what I hear. Amex does not check. 

[00:23:39] Jamie: So they're making too much money to care,

[00:23:42] Spencer: From what I hear and keep this on the DL, but there's guys who have been out five, 10, even longer years, and they're not getting charged annual fees, even though they left active duty.

So that's awesome. So I think the biggest thing here is don't panic. Relax, keep your cards open until you get warned that you're going to be charged an annual fee. And then even if you miss the warnings for most of these cards, you can close the account within 30 days of being assessed the annual fee and chase and Amex will refund you the annual fee.

So there's a lot of consumer protections built into these companies. Probably not. They're doing. It's probably the laws and the regulations that they have to comply with, but they're not going to assess a fee without warning you a lot. And then even if they do charge you the fee, you're going to have an opportunity to have the fee revoked and then to close the account if you're not getting value from it.

[00:24:38] Jamie: That's really good info there. I want to clarify when you've said, usually the, we're going to charge you a fee in six to 12 months. Does that six to 12 months date usually coincide with your card anniversary date or do you know, or are they picking just a future date?

[00:24:53] Spencer: I think it is like the date that you should have been assessed and charged the annual fee.

Yeah. While you were on active duty orders. Yeah. So I think it is your card anniversary. I don't think they just pick a random day. I think, they find whatever it, I think there's, there must be some kind of if your date is in 30 days, they might say

[00:25:10] Jamie: I wonder if you can get 13 months out of it then.

[00:25:12] Spencer: Yeah, maybe, which could be, which could be for some of them, for the right card, for a Chase Sapphire Reserve where you're going to get $300 annual travel credit every calendar year. That's, that could be worth it to keep that card open a little bit longer.

[00:25:26] Jamie: Okay. So I want to back up a little bit.

Just a little practical snippet here of if I do decide I want to close a card, what is it like to close a card? Is that an arduous process or what's that like?

[00:25:40] Spencer: Over the years, especially since I caught the travel , military credit card bug back in 2017, 2018, I've opened over 40 cards and probably closed dozens.

And let me just tell you, it's simple. It's easy for most, for, I think for American express, you can do it with a couple of clicks. You can close the account for Chase. I think most of the time you have to send them a secure message through the website telling them which account number you want closed.

But yeah it's very simple. It's not a big deal. They deal with us all the time there. You're not hurting anybody's feelings by closing the account. If they ask you why you're closing the account, tell them it's because you're going to charge an annual fee now and for a lot of, sometimes they'll say what if we, reduce the annual fee or what if we waive the annual fee for a couple of months And that can be a bargaining chip right there.

Never just tell them like, Oh, I don't want the card anymore. You can just tell them honestly, like the fee, the annual fee is very high and I don't know if I'm getting enough value from the card on the more premium cards, like the Amex Platinums, the Chase Sapphire Reserve. I haven't heard of a lot of people getting fee waivers, but on the lower tier cards, there's always.

There's always data points out there of someone they're trying to retain as a customer. They'll waive the annual fee for a little bit. Yeah. 

[00:26:56] Jamie: I've actually seen a lot of data points on the Amex Platinum retention offers recently. Yeah. Oh yeah. But it comes with a spend. So it might be, we'll give you 40,000 points if you spend $4,000 in the next three months.

Every once in a while you'll see someone get, here's 50,000 points, just if you agree to stay on. But usually it's with some kind of spend requirement, but you never know if you don't ask. And then Spencer, you mentioned also earlier downgrading cards might be an option. So you could consider downgrading cards to either a no annual fee card or just to a no annual fee card for the purpose of keeping your points and miles.

So talk to us a little bit about that.

[00:27:36] Spencer: Yeah, so when I closed my Chase Sapphire Reserve a couple years ago I actually did this. I didn't close it. Sorry. I downgraded it to a Chase Freedom card. I think at the time there wasn't the Freedom Flex or Freedom Unlimited. It was just the Freedom.

And so I just called them, called up Chase and said, I don't want to pay the annual fee anymore. And they weren't willing to waive it. So I downgraded the card from a Chase Sapphire Reserve to a Chase Freedom card. And what that allowed me to do is all the points I'd accumulated on that card, the Chase Ultimate Reward points, I got to keep them.

And I was able to transfer them to my wife's Chase Sapphire Reserve card, which was an annual fee waived because she opened it after Chase changed their policy. And so that way, there was a couple, it was probably like, I can't remember how many points were on the card, but, probably easily 100,000.

And so that's, that's something that's really important that you want to watch out for when you do get out of the military and you start evaluating, which cards am I going to close? Which cards am I to keep open? And this doesn't have to happen when you get out of the military too.

A lot of times, like sometimes you just want to simplify life, and like I was checking the other day and I've, I had a Chase Freedom card. I had three Chase Freedom cards. Like, why do I need three Chase Freedom cards? They don't have any now, like a card that provides an annual benefit, like the Chase Sapphire Reserve.

Sure. But this was, I had three Chase Freedom cards cause I had downgraded. A Chase Sapphire Reserve. And then I had another Chase Freedom card. And so I called Chase and said, I want to close this account. And the other thing I did too, is I asked him to move the credit balance to another card.

Chase is really particular about the credit balances of each card. American express doesn't seem to care. They'll just give you whatever on any card. But yeah, I was able to transfer the credit balance. And then, like I said, when you downgrade the card, you can keep your points and miles and those points can have a lot of value.

Especially for the fully flexible points, like the chase ultimate rewards, the american express membership rewards. Now the Amex, there is no Amex membership reward card that does not have an annual fee. So I think the lowest one is the Amex Green and I can't remember if that's a, I think it's not $195 currently.

[00:29:55] Jamie: But if you're keeping a couple hundred thousand Amex points, that might be worth paying for another or another year or

[00:30:01] Spencer: two, for example, 150. That one's one. Yeah.

[00:30:05] Jamie: Okay. Spencer back to I forgot to follow up on closing your account. So a couple other admin details you want to do before you call or chat to close an account.

Make sure any recurring transactions like your Amazon subscription, Netflix, anything like that has been changed to a different card. And what about the balance? Do I need to make sure the card's paid off or credit balance? You mentioned a minute ago. What do I need to do with those?

[00:30:27] Spencer: Yeah, absolutely.

Don't ever close an account if you haven't paid it in full. So one thing that I do is I just look at the last two months of statements, see if there's any recurring. Charges, Spotify, Netflix, Amazon, and then go to those subscription services, change the credit card, and then.

But even if they charge a car that's been closed, they'll tell you, cause they want money. So you don't have to worry too much about that. And yeah, just make sure your balance is 0. And when you go to close the account, they'll tell you your balance is 0 and you're like, great.

That's exactly what I want. If there's a balance on the account just pay it off, if it's and if it's too high, you don't have the cash to pay it off Then just wait on closing it until you have but you know Really? You should always be treating a credit card like a debit card. You should always have the money there to pay it off.

Yeah, so never get ahead of yourself and you're living paycheck to paycheck.

[00:31:22] Jamie: So the big question, I think that a lot of people get worried about when they start thinking about opening up multiple credit cards. What will it do to my credit score when I close all these cards?

[00:31:34] Spencer: So if I close them all or a few of them.

Yeah. Yeah. So if, one thing, if you're worried about that, Don't close them, if your credit card especially if you have, if you're buying a house, yeah, if you're gonna buy, if you're buying a house next couple months, now is not the time to start closing credit card accounts. And it might be worth paying a $500 annual fee just to like, when you apply for that mortgage. You have a clean credit history and there's nothing weird in there Oh, you just closed this account. But besides weird things like that, like you're about to close on a house, you need to get approved for a mortgage or you've got an auto loan, then it really should have a minimal impact on your credit score.

10 to 20 points for a year or more, after a couple of years, all those closed accounts are going to drop off your credit score and you're going to be fine. 35 percent of your score is on time payment history. Right there. If you've been paying all your credit cards on time, like you should be, or paying them ahead of time, then there's 35 percent of your score.

30 percent of your score is credit usage. So how much of your available credit do you carry a balance on? Now, if you pay your card off before the statement even posts, and a lot of time that can be like a 0 percent credit utilization rate, because. The credit card companies never even report to the credit bureaus that you have a statement balance and then 15 percent is the length of credit history.

So one thing that you really want to try to do is open up a no annual fee card first, like the chase Freedom or like a Navy Federal card, USAA and then that way you can close all your other accounts that have an annual fee on them, but you keep that account open and that ages all of your credit history.

So if that, if you open that account when you first get in the military, you get out four years later. Now that card is four years old and that's providing a lot of gravity, a lot of gravitas to your credit history. And then right there at 35 plus 30 plus 15, that's 80 percent of your credit score is completely unaffected by closing accounts.

A lot of people, Worry about the credit score, I think unnecessarily, like just if you make your payments on time, you have a couple of cards open and you have a history there, right? Like they want to see, years. So it helps to whatever your oldest card is, just keep that open.

So you continue to age your credit history. And Yeah, I wouldn't worry about it too much. I think the credit score it's been completely hyped up and mystified and it's mostly BS. Like just make your payments. Like the most important thing is just make your payments on time and keep an old account open and you'll probably have there's like probably that's probably 750 right there. And then, like for me with 29 accounts open, there's like several tens of thousands of dollars of credit there that I don't use. So that's probably another 50 right there. So now I'm up at 800, right?

[00:34:16] Jamie: I think people, hopefully we've demystified it a little bit today where people probably envision the day they leave active duty, they're automatically getting $7,000 worth of annual fee bills.

And now that we've told them and proven that it's not like that. You can be smart with the timing, think about which cards you want to keep open or how many of them. And if you are applying for a mortgage, you're moving and buying a house. You can probably talk to your mortgage lender.

The last mortgage we have is with Navy federal and you could ask them like, Hey what's. The last credit report you're looking at, because I have something else I want to apply for too, or some other changes I want to make. And they're like, Oh we, we do that when we give you your quote, and then we don't look at your credit again, or whatever that bank's process might be.

So you can plan around that, but it's not like all 29 of these accounts are going to hit you with an annual fee the day you leave active duty.

[00:35:05] Spencer: That's right. Yep. Yep, exactly. Yeah. Final thoughts. Recommendation based on dozens of data points I've had over the years with other military veterans is just keep your cards open, wait for the credit card companies to approach you and tell you, Hey, it's time to start paying your annual fee and then do, a sober assessment of what do I want to keep open and what am I getting value out of and what am I not getting value out of?

I think one thing though, is if you have a big store of points and miles. Don't throw those away, find a way, find a way to either transfer them to a partner, transfer them to a spouse transfer them to an even if you just take all your chase points and move them to United, cause you're going to fly United in a couple of months, do that, bank them somewhere. Yeah, I think, for me, I would probably be willing to pay the annual fee just to have them stick around, but even on the Chase Sapphire Preferred, you can use the Chase travel portal at 1. 25 cents and you can bank all your car, your points on the Chase Sapphire Preferred.

And that's a $95 annual fee card.

[00:36:04] Jamie: And then, Spencer, one last question that we get sometimes at FAQ, if you will Amex or Chase, do they waive any fees for veterans or retired military? And the answer goes into why we talked about this today, but

[00:36:21] Spencer: They don't.

So Amex and Chase and actually none of the credit card companies, USAA, Navy, federal, no one actually waives if they charge an annual fee on the card. You're getting charged an annual fee on the card if you're a veteran or retired military. There's no benefit. I get this question a lot through the website.

Retirees coming around trying to see if they can get their fees waived. And the answer is sadly, no, there's just, there's no consumer protections for us veterans. Like there are for active duty military service members with the MLA, Military Lending Act and the Service Member Civil Relief Act, SCRA.

So if you want to get your annual fees waived, you've got to apply for these cards while you're in active duty. And don't miss the opportunity, especially with American Express. If they're not going to check that often, that's on them. Definitely get the card while you're on active duty, and then you can, you can keep it open and get the fee waived when you're a veteran.

[00:37:13] Jamie: But remember, like we talked about a couple of times today, some of the cards are so beneficial that it may be worth keeping open and paying the annual fee. At least for a couple of years, at least till you get your points redeemed or whatever situation you're in.

So it doesn't have to be an all or nothing situation for you, but a really important topic that a lot of people worry about that we covered today.

[00:37:34] Spencer: Yeah, there's millions, maybe not millions, but hundreds of thousands of civilians out there, they're called travel. And they open up these cards and they pay the annual fees and they still get value out of them.

So while in the military, while you're in the military, you have a cheat code, you don't have to pay the annual fees. So it makes the value proposition. Astronomical, like it's, it blows my mind that anybody who's good with math, good with money and likes to travel, doesn't take advantage of these benefits, but they're out there, those people are still out there.

Yeah, once, once you become a veteran you're locked out of all those benefits. So it helps to catch the travel bug while you're active duty. And then after that, you're just, you're basically just like a civilian. You're not going to get your fees waived.

So today in the podcast, we talked about the Hilton honors military program. That's a free hundred thousand Hilton points for active duty service members who are separating and their spouses as well. So that's up to 200,000 points per couple as an excellent benefit. Not really talked about that much.

It's available now in 29 States across the great United States of America. We also talked about what to do with your annual fee waived cards after the military. Basically just chill, let the credit card companies come to you and say, Hey, you're not an active dude anymore. You need to start paying our annual fee and then assess what cards are you getting value out of?

What cards do you want to keep open? For myself, probably a couple of Amex cards, probably a couple of Chase cards. Cause I get a lot of value out of both programs. And I have a lot of points stored up that I need to start spending as well. And then if you've gotten value out of this podcast.

Please leave us a review on Spotify. There's just in the, under the podcast thing, there's a little thing that has a little star next to it should hopefully say five stars. You click on that and you can leave us a five star rating. You can do the same thing on Apple podcasts, and you can even write a review too, if you found it super, super useful, just let other people know what you enjoy about the podcast.

You can reach out to us, instagram.com/MilitaryMoneyManual, and I will get back to you on there and, or you can shoot an email info, info@MilitaryMoneyManual.com. And we'll see you next week on the Military Money Manual podcast.

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