Buying Health Insurance with Cash Back Rewards on Your Credit Card!
Have you seen this Capitol One credit card commercial where the guy earned $36K back in cash back awards? He said it was enough to pay for his employees health insurance:
Last year, we spent about $30,000 on health insurance for our employees; so, just about what we got in cash back from the Capital One card.
From what I can tell online this company has 7 to 12 employees. Let’s make the math easy and say they have ten. So, $3000 a year for each employee covers all their health insurance? Something doesn’t smell right here especially when you read this recent article that came out on CNN:
Employers and workers together are spending close to $20,000 for family health insurance coverage in 2018, according to a new Kaiser Family Foundation report.
Although premiums have increased fairly modestly in recent years, the growth has far outpaced workers’ raises over time. The average family premium has increased 55% since 2008, twice as fast as workers’ wages and three times as fast as inflation, Kaiser’s Employer Health Benefits Survey found.Companies pick up most of the tab, shelling out $14,100 a year, on average. Still, workers have to pay an average of $5,550, up 65% from a decade ago.
Doug, while I agree with the premise of your post, I believe your math is suspect. The credit card in question pays 2% cash back for purchases of all sorts. Therefore, it follows that the company CEO would have to purchase $1.8M in goods and services to realize $36k cash back. Also, the CEO is quoted as saying he “spent about $30,000 on health insurance for our employees”. That sum could be total company contribution to his employee insurance premium pool, not necessarily covering the entire premium cost. And, as you mentioned in your post, we do not know the denominator in terms of company employees.
They make it seem that he “covered” their insurance costs so I am not sure what to believe.