Uber, dining out, MTA, shopping, Broadway tickets, $12 cocktails, groceries... no matter how you slice it, New York City is expensive. According to Investopedia, the average dinner for two will set you back $75, that's 36% more expensive than Chicago!
But, there's good news. Every dollar spent is an opportunity to earn rewards - and because New Yorkers are the highest spenders, they should also be the highest earners. Without spending any more than you normally would, the average New Yorker can earn up to $720 each year worth of rewards. That's 3-4 nights in an upscale hotel, 2 roundtrip flights or cash back in your wallet.
We looked at spending trends for folks who live in New York City or one of the boroughs, using data published by the Bureau of Labor Statistics:
Average Monthly Credit Card Expenses
What we found was that the average New Yorker spends $2,262.30 each month on expenses (not including rent because you can't normally pay with a credit card). Personal insurance was the largest expense at $658 each month, following by dining and groceries at $566 a month combined.
Assuming that the average person also takes 3 trips a year, at an average of $1,000 per trip, that's another $3,000 in yearly spending or $250 per month.
We analyzed a simple wallet (3 cards) that earns rewards on all of these purchases with good valuations.
Citi ThankYou Premier CardApply Now
How It Earns: Travel & Transport - 3x points, Dining & Entertainment - 2x points, Everything Else 1x points
Redemption Rate: 1.25 cents
Annual Fee: $95, waived year 1
Potential Rewards: $368.91
Barclays Arrival PlusApply Now
How it Earns: Everything - 2x miles
Redemption Rate: 1 cent on travel, 5% rewards back as a bonus
Annual Fee: $89, waived year 1
Potential Rewards: $413.84
American Express Blue Cash EverydayApply Now
How it Earns: 3% cash back on groceries (up to $6000), 2% cash back on gas stations and US Department Stores, 1% back on everything else
Redemption Rate: Cash Back
Annual Fee: $0
Potential Rewards: $88.64
Total Rewards = $871.39
Factoring in Annual Fees
Almost almost $900 in rewards is amazing! But there's one key calculation missing - and that's the annual fee. Although the annual fees on the Citi Thankyou Premier and Barclay Arrival Plus are waived in the first year, it's important to calculate the value with the annual fees to know the true value.
Once factored in, the total rewards earned for the average New Yorker come out to $687.39. Still not bad for getting value back on your everyday spending.
If you live in New York, your expenses are high. Make sure you have the right mix of credit card rewards to optimize your rewards and save on travel each year. If you're using the wrong cards, you could leaving over $700 worth of rewards on the table!
What are your thoughts? Send us an email at firstname.lastname@example.org!