Trip Astute has partnered with CardRatings for our coverage of credit card products. Trip Astute and CardRatings may receive a commission from card issuers. Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities.

As many of you know, I started doing free credit card consultations last month, and the response has been amazing. Though one thing that’s come up during several sessions is anxiety over applying for certain cards because of the minimum spend requirements. I completely understand this concern. I’m also not a big spender in my daily life. So in this video/post, I want to review a service called Plastiq that can help you with meeting your minimum spend. I’ll discuss how to use Plastiq and share some general tips to keep in mind when using the service.

What is Plastiq?

How Plastiq's service works
Plastiq is a bill pay service that uses your credit card instead of your bank account to make payments

Plastiq is essentially an online bill pay service that is similar to your bank. The difference is that the payment is processed on your credit card as a purchase and not a cash advance. Plastiq then makes either an electronic payment or sends a check in the mail to pay your bill. It’s a simple and hassle-free way to shift some spending onto your credit card.

Plastiq logo
Plastiq has served the points and miles community since 2009

Plastiq has been around since 2009. This is important to know since a lot of similar services have come and gone over the years. However, Plastiq has remained in business and been a reliable service. I’ve been using them since I started the points and miles hobby in 2011, and their service has always been a great way to use your credit card to pay for expenses in your life that normally aren’t credit card friendly. This includes things like rent payments, utilities, car payments, business vendors … basically anything!

What’s the catch?

2.5% transaction fee from Plastiq
Plastiq charges 2.5% for their service

Plastiq charges a 2.5% transaction fee for credit card payments. You might ask, “why would anyone want to pay 2.5% to make a purchase?” It’s a valid question! I’ve personally relied on Plastiq when I needed to complete the minimum spend on a new credit card. Since I’m not a big spender, I try to align my credit card applications with big purchases in my life. Though sometimes, the timing just doesn’t work out. In those situations, Plastiq has helped me to meet the minimum spend.

Chase Sapphire Preferred credit card

The reason it might be worth paying the fee is that the benefits you’ll get from a welcome offer usually offsets the fee for using the service. For example, as of March 2019, if I were to apply for the Chase Sapphire Preferred, I would need to spend $4,000 in three months to earn the welcome offer of 60,000 points. If I were to pay my rent or bills to cover the full $4000 of the minimum spend, I’d be looking at $100 in transaction fees.

Understanding the value of points

Breakdown of cost for Chase Sapphire Preferred Welcome Offer
Regardless of how you calculate the value of Chase UR points, you’ll still be ahead using Plastiq’s service (even with the transaction fee)

If we assume that each Chase Ultimate Rewards point is worth 1.25 cents, which is likely the minimum redemption value for travel, then 50,000 Ultimate Rewards points are equal to $625. If you were to value the points at two cents per point (e.g., The Points Guy), then 50,000 points are worth $1000. In the big picture, the fee might be worth the cost if you know you can earn a large and valuable welcome offer in the process.

American Express Blue Business Plus credit card
The Amex Blue Business Plus offers 2X Membership Rewards points on all purchases. Learn more about American Express cards.

I know some people who even pay their rent or mortgage every month with Plastiq since they feel that they come out on top. For example, a friend of mine uses his American Express Blue Business Plus credit card to pay his work studio rent every month using Plastiq. He’s able to squeeze more than two cents a point on redemptions, primarily on flights to Asia via ANA. Since the card earns two Membership Rewards points per dollar, he calculates the earning rate of this card to be about 4%. With that in mind, he’s willing to pay the fee since he is earning value from the transaction.

How to use Plastiq

Option to Add a Referral Code in Plastiq
Make sure to enter a referral code in order to earn fee-free dollars on your payment

To use Plastiq, all you have to do is head over to their website to sign-up for an account. It’s completely free. You’ll be asked to confirm your email. Once you confirm, you’ll enter your personal data. There’s also a section at the bottom to enter a referral code. If you need one (or want to support our website/channel), you can use TripAstute to get $500 fee-free dollars after you spend $500 on the service.

Add New Card screen in Plastiq
You can add any major credit card to your Plastiq account

Once your account is set-up, you’ll want to add credit cards to your account.

Add a Recipient screen in Plastiq
You can add recipients and schedule recurring payments in the Plastiq interface

Once your cards are set-up, you’ll click Start a Payment. You can then Add a New Recipient, or if you’ve already done so, you can start scheduling your payment. Just like any bill pay program, you’ll be asked to see if the vendor is already in their database, which allows them to make an electronic payment. You’ll be asked whether you want to make a single or repeating payment and the exact date of payment delivery.

Apply my Fee Free Dollars option in Plastiq
You’ll want to apply any fee-free dollars before submitting your payment

You’ll also have the opportunity to apply any fee-free dollars that you may have earned. Just click on the Apply my Fee Free Dollars option at the Review screen before you submit your payment. This will apply the credit toward your payment.

Plastiq also offers expedited options, both for electronic and check payments. For check payments, it’s 3% instead of the 2.5% transaction fee, plus additional fees for FedEx overnight and handling. I wouldn’t use it unless you really need it, but the option is available. Plastiq also offers domestic and international wire options, but those cost extra too.

Restrictions of Plastiq

There are a few restrictions when using Plastiq that you should keep in mind. UPDATE: Plastiq sent us a chart that outlines which cards can be used for different types of payments.

American Express cards:

Unfortunately, Amex cards have the most restrictions when it comes to using Plastiq

If you’re using an American Express card, there are some categories of payments that are not allowed on Plastiq. This includes:

  • Mortgages
  • Student Loans
  • Auto payments
  • Business invoices
  • Contractors
  • Business utilities
  • Health insurance premiums

This could change in the future, so you’ll want to check Plastiq’s Support Section on the current restrictions. Plastiq will also warn you on the final screen before submitting your payment if there’s an issue.

Mortgage payments:

Small wooden house token on calculator
Unfortunately, you can only pay your mortgage on Plastiq with a Visa or American Express

You can’t use a Visa or American Express to make a mortgage payment. This affects mortgages but not rent payments. I can understand why this might be the case. However, I know it might be frustrating for those of you with a mortgage payment, especially if it’s your biggest monthly expense.

Chase cards:

Front of Chase Bank in Hollywood, California
Chase has strict rules when it comes to making payments that are larger than 20% of your card’s credit limit

If you’re using a Chase card, make sure you check your credit limit and the amount that you’ve used. Chase has a policy where you can’t make a Plastiq payment using a personal Chase Visa card that is more than 20% of your current credit limit. According to Plastiq, any charge to them that’s over 20% of your credit limit is treated as a cash advance by Chase, so Plastiq does not allow it.

Failed payment in Plastiq
I did NOT receive a notification when my payment failed, so be careful and be sure to verify!

I experienced this issue a few months ago and didn’t realize it until I noticed that I didn’t receive a notification for the payment. When I checked online, I found that the payment had failed. I then had to ask Plastiq for more information on the transaction, so be careful with this rule!

Tips for using Plastiq

As always, I want to share some general tips for using the service.

1. Set a reminder to verify that your payments have processed:

Reminder in Todoist to verify Plastiq payment
I recommend setting a reminder to verify your Plastiq payments

As I mentioned earlier, I had a payment fail, but only knew it since my card wasn’t charged. I don’t think that Plastiq sent me a notification or email either. To avoid this situation, I recommend setting up a reminder to verify that your payment goes through. I have notifications for all credit card charges through my mobile apps. However, I also set a reminder in my to-do list to verify that the payments have processed.

2. Don’t use Plastiq for peer-to-peer payments:

Friends celebrating over a meal
Plastiq is not intended for peer-to-peer payments

Plastiq cannot be used to pay your roommate or friend for dinner. It’s meant to work for official payments where there’s an actual contract in place. Just be aware that you’ll only want to use the service for official arrangements where the transaction can be verified.

3. Consider requesting a decrease in your cash advance limit:

US cash in $1 and $20 notes
You’ll want to avoid a cash advance at all costs!

While Plastiq avoided triggering a cash advance on my credit card by canceling the payment, it might be worth asking your issuer to lower your cash advance amount. Each bank has their own policies around cash advance limits. For the major issuers, it’s usually possible to request it, with the exception of American Express. They dobn’t allow you to lower your cash advance limit since it’s automatically set by your credit limit.

4. Check your card’s expiration date:

Credit card expiration date
Be careful of any cards that may be close to their expiration date

You’ll want to make sure that your credit card has not expired when using Plastiq. This is easy to miss, especially if you set-up a recurring payment. Again, I recommend setting up a reminder for yourself to update your account when the card is close to expiration.

5. Set-up a PIN code and two-step authentication:

Plastiq's security settings including PIN and 2-Step Authentication
Make sure to set-up your PIN and 2-step authentication in Plastiq’s security settings

Plastiq offers additional security measures with their service. I highly recommend setting up a PIN code and enabling two-step authentication. Just like with any bank account, you want to keep the account as secure as possible.

6. Use their referral system to earn fee-free dollars:

Details on Plastiq's Referral Program
You’ll want to share your referral code/link so you can earn some fee-free dollars (FFDs)!

If you start using Plastiq, I recommend taking advantage of their referral system. You can earn $1000 of fee-free dollars (FFDs) when someone uses your referral code. They’ll also get $500 FFDs after they make their first payment of at least $500.

7. Be mindful of Plastiq reward dollars expirations:

90 day expiration for Plastiq fee-free dollars
You have 90 days to use any fee-free dollars that you earn with Plastiq

If you earn fee-free dollars, then you have only 90 days to use them. That’s not much time, so make sure you plan accordingly if you earn FFDs.

8. Consider using Plastiq for business expenses:

While we normally think of Plastiq in terms of meeting our minimum spend requirements, it’s also a useful tool for businesses. If you’re a small business, you can use Plastiq to manage your cash flow for expenses. You can even work with vendors to see if they’ll accept payments earlier for a discount. For example, on my other small business, I’ve sometimes been given the option of paying a supplier earlier for a 5-10% discount. Since Plastiq charges 2.5% for the transaction, the math works out in my favor.

Florist desk with flowers, tools, and computer
Small businesses can use Plastiq to help manage their cash flow and payments

Another advantage for small businesses is that you can classify Plastiq transaction fees as a business tax deduction. It’s something to consider if you operate a small business and looking for additional tools to manage your cash flow and payments.

9. Check for promotions on Plastiq’s website:

It’s not uncommon for Plastiq to run promotions where they drop the transaction fee to 1.5%. I recommend signing up for their newsletter or checking their website often for any promotions.

Final thoughts

Chase Sapphire Reserve & American Express Gold Card on top of a Bellroy Card Pocket wallet
Plastiq is a fantastic tool for helping to meet your minimum spend

Overall, I think Plastiq is a great tool to use, especially for those of you in the points and miles hobby. It’s probably not something that you’ll use every month, unless you’re a small business. However, it can save the day if you’re struggling to meet a hefty minimum spend requirement. As someone who doesn’t spend very much in my daily life outside of travel, I’ve relied on the service many times in the past to help reduce the stress of meeting the spend requirements on new cards.

Have you used Plastiq? Do you have any other tips for using the service? Let us know in the comment section below.

If you’re interested in applying for one of the credit cards mentioned in this post, we encourage you to compare credit card offers. We do get a commission if you use our link. It doesn’t cost you anything extra, but it helps us to continue building content for our site and channel.

Trip Astute has partnered with CardRatings for our coverage of credit card products. Trip Astute and CardRatings may receive a commission from card issuers.

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