Ask the Readers: Which Credit Cards Do You Use — and Why?
Published on - July 16th, 2010 (Modified on - January 18th, 2012) (by J.D. Roth) I’m always reluctant to cover credit cards here at Get Rich Slowly. There are other sites that do it better. Besides, I’m still not wholly convinced they’re a good idea. Plus, my wife — who is always right — told me the other day, “I don’t like it when you write about credit cards. Credit cards are boring.”
Still, in today’s world, effective use of rewards credit card is an important part of personal finance. If you don’t use them correctly, you can end up deep in debt. (I’ve experienced this first-hand.) But if you do use them properly, they can actually help your financial situation. (Note: See How to Choose a Credit Card).
Joining the Dark Side
When I started Get Rich Slowly, I was staunch supporter of the anti-credit card camp. I’d been stupid with credit cards when I was younger, and they were a big reason I found myself with over $35,000 in consumer debt. I’d been burned, and like Dave Ramsey, I couldn’t see any benefit to using them.
As my financial habits improved, however, I came to understand that credit cards aren’t necessarily evil. My wife, for example, has had a credit card for as long as I’ve known her (over 20 years!), and has never carried a balance. She loves using her Discover card, which gives her up to 5% cash back. (“To be honest,” she told me tonight, “I only get about 40 cents per month from using the thing, which is about half a percent cash back.”)
Still, I was wary. But three years ago — as we were preparing to travel to England, Ireland, and New York — I decided to take a risk. Based on the urging of GRS readers, I signed up for a credit card. I chose the Capital One No-Hassle Cash Back card because it offered some perks for travelers, and because I liked the idea of getting a one percent cash discount on everything I buy with it.
When I signed up for a credit card, I made some rules for myself. I vowed to:
- Pay off the entire balance every month.
- Never buy anything on credit unless I already had the cash in the bank to pay the bill.
- Make my decision about what to buy and then decide how to pay. (Instead of saying, “Oh, I have a credit card, so I can buy this.”
- Never use my credit card for impulse purchases.
If I violated any of these rules ever, I promised myself I’d cut up the card. Three years later, I still have that credit card.
The Chainsaw of Personal Finance
While I’m not about to sing the praises of credit cards, I do think they’re a useful tool in the responsible person’s financial toolbox. To quote myself from Your Money: The Missing Manual:
Credit cards aren’t evil, but they can be dangerous. Just as you’d treat a chainsaw with respect, you need to be careful with credit to avoid hurting yourself. And if you use them wisely, credit cards can actually give you a financial edge.
I don’t write about credit cards very often at Get Rich Slowly. If there’s something that needs to be said about credit, I usually let a guest poster do that. (Get Rich Slowly has good relationships with both Index Credit Cards and Card Ratings, and fellow blogger Five Cent Nickel keeps an updated list of balance transfer credit cards; they all know a lot more about this stuff than I do.)
But I’ve been wondering lately just how GRS readers use credit cards. I suspect that many (most?) of you are like me: You use credit cards wisely, and they’re tools that helps you achieve your goals.
So, I have some questions today. As I mentioned, I’m using the Capital One No-Hassle Cash Back card (man, what a dumb name!). What about you? Which credit card(s) do you use? Why do you use it? How, when, and where do you use it? Do you have personal rules for credit card use? Have you ever been in credit card debt? How do you steer clear of that now? I plan to collect your answers for a future post, one that I hope will help others learn to use credit cards responsibly.
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This article is about Ask the Readers, Credit Cards
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I have a Royal Bank Gold credit card and my husband has a CIBC (canadian Imperial bank of Commerce) Aeroplan card.
We use them for convenience, paid off every month. Hubby’s gets us tons of Air Canada miles, mine gets me contributions to my Registered Retirement Savings Plan (RRSP). I’m clearly not going to retire off of the spending on my credit card, but it helps!
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DH and I both have mileage cards. Since we don’t carry balances, it’s great. Between the CC miles and flying for work, we rarely have to buy tickets when going on vacation.
We were both in credit card debt while we were in graduate school, but DH had some stock that we wanted to sell. We sold about half of it to pay off the credit cards (~$4000 at that time) and to pay back my parents for the loans they took out for me for undergrad (~$10,000). Since 2001, we have not carried balances.
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I use the Schwab card that gives 2% cash back on all purchases. It deposits 2% of my monthly purchases into a Schwab brokerage account, which I then move into a Schwab IRA.
Unfortunately, the card is now closed to new users.
That said, Fidelity has a similar one.
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I have 2 credit cards from Bank of America – a Visa and Mastercard. The first card I use for online purchases only. The second I use for store purchases – the gas station and grocery store weekly and all other stores whenever. Originally I separated the 2 cards in case of card info theft. Not sure it is effective but I like to think it is. My rules for credit card use are simple. I only buy what I have cash to cover – the cards are for convenience only – not credit. I use an excel spreadsheet that is envelope style for my checking account. There is a column for each card – and when I make a purchase with a card, I promptly move the amount from whichever other column/envelope – like gas – to the credit card column. A little tedious perhaps but it works for me. I had a credit balance up to 10k back in the mid-90s after college and lawschool which took me forever to pay off. Don’t want to go there agagin. The only downside to my credit cards is that if I were spending cold cash at the grocery store, I might spend less. However, I stick to a grocery list and only usually buy one splurge item, like a box of donuts or a bag of cheesy puffs, so it wouldn’t be much less. Balance that with I feel much safer using a credit card at the gas pump than going inside the convenience store – especially with a baby in tow.
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Both of those cards are my go-to as well depending on weather or not I need a Visa (Schwab) or an Amex (Fidelity).
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I’m currently living in Germany, and this country does not use credit cards at all outside of the tourist-filled big cities. It’s all cash or “Easy Cash” cards (from what I understand, it’s a debit card basically). It’s a bit strange – they expected us to buy our bikes (about $1000 Euros for 2 really nice bikes that are our main transportation in the summer, helmets, and locks) with cash. It wasn’t a big deal for them – most Germans seem to carry around a few hundred Euros. I’m interested to see how I’ll be going back to the states in three years…it should be an interesting change back.
My husband and I do use credit cards, or at least we do when we can. We have a Mastercard through USAA and a card that allows us to get our gas (through the army) with 5 cents off per gallon if we get it at a gas station on an army post.
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I use a Visa card affiliated with Working Assets, though the banks have changed over the years. It gives a 10-cent donation to social and environmental causes with every purchase. By nature I’m very frugal, so I don’t have a problem using it for everything I buy; in fact it helps because I’m lousy at balancing a checkbook and keeping track of cash withdrawals. I find that a credit card is good when travelling, to guarantee hotal reservations and to avoid carrying large amounts of cash. I also like knowing that I have a line of credit in an emergency.
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I have one Mastercard that DH and I both use for almost all our purchases. I get airmiles on it – redeemable points. Perhaps it would be better to look into cash back, but it’s not worth the hassle as I’ve had this card for years. We do get free stuff from it. Having the one card helps with tracking and splitting joint expenses. I pay it off in full every month. And pretty much follow JD’s rules. Never in my life have I thought to buy things on the credit card that I didn’t have the money for. I definitely think about the purchase independent of the payment method. But if I’m going to buy something anyhow, I’d like to get the points. The insurance on the credit card is also nice to have. DH has his own VISA as well, but he uses it less than once a month.
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I use Citi Forward and Citi Premeire Pass.
I use Citi Forward because I receive 5 Thank You points (which would be equated to 5% back) on book stores, restaurants, movies, and concerts, and one point on everything else. I mostly use it as an avid Amazon buyer because Amazon counts as a bookstore.
I use Citi Premeire Pass for booking flights because I receive 1 point for every dollar spent and every three miles flown.
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JD,
I use a credit card for everything I can. I have the Navy Federal Credit Union nRewards card which gives 1% cash back on all transactions up to $10,000 in a year and 1.5% cash back for all money spent after that! I even pay my rent which has a $10 fee to use my CC because my rent (after my roommates pay me their parts) is $2100 a month (I have two roommates). I earned $300 from this last year for essentially doing nothing but always paying my bill off in full. I stick strictly to my budget and using a credit card doesn’t affect my spending habits. I find if I have cash I actually blow more money than if I use my credit card!
-Lance
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I used the UPromise card which send a certain percentage a 529 plan for my kids college. I have an autopay set up to pay the entire balance every month. Also, as long as I have had credit cards I treat it the same as writing a check. As soon as I make a purchase I note it in my ledger, then when the actual payment is made I will reconcile the payment with what I have already written down in my ledger.
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I have two different cards: a Discover card and a Chase Freedom Mastercard. I originally signed up for both of them because they were free and each offered cash back rewards. Unfortunately, the Chase Freedom card recently instituted a yearly fee of $30. This is ok though, because I typically earn about $100-$150 in cash back rewards from them. They have 1% cash back on all purchases, plus up to 5% cash back in special categories.
For the Discover card, there are variable levels of cash back from 0.25% to 1% for all purchases. Also, there are special categories throughout the year that offer 5% cash back. This is where the real rewards come in. By carefully planning my purchases for the 5% cash back, I am able to get this card to work for me. I typically earn $50-$100 cash back on this card a year, and there is no fee.
Also, in 5 years of having these cards I have never carried a balance, and only missed one payment by two days because of a vacation that got unexpectedly extended (stupid I know).
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Hi Dan!
I would go into a Chase branch if you have one near by, or call them up. The Freedom shouldn’t have a fee on it. Chase does have a Sapphire card that has an annual fee. Also, make sure that you are enrolling in the quarterly categories – they give 5% cash back.
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I have two cards. My first card is my Chase Freedom card which pays all my automated fixed expenses so that it stays open. My second card I got when I recently started traveling internationally was the Schwab card mentioned in post #1. Since it’s return is better than Chase these days I’ve been using it for everyday purchases. The only reason I opened that card was because there are no foreign transaction fees. Combined with ATM reimbursement since I have a checking account with them and I had no fees when traveling for multiple weeks in Brazil!
In general my preference is to have only one card but since my first card was my chase card it is my longest credit history.
I always pay my cards in full and since I live on last month’s pay the money is always in the bank before I spend it. To be honest, and I should thank my parents, until I started reading this site it never occurred to me that I could use the credit card to spend money I didn’t have. Because of my habit of always using the card though, if I ever do have cash, my brain considers it “free money” since it is already out of the bank and it disappears very quickly.
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My wife and I both have a Citi Dividends reward card. I’m not sure they even offer them to new customers anymore, but they seem to have kept them around for existing customers. They used to pay 2% (way back in the day, 5%) on gas, grocery and a few other category purchases, so we pretty much have used it for those purchases. We pay our cards off every month and have amassed around $1,300 over the few years of having the cards. We’ve earmarked this for electronic purchases, and have actually bought a couple of flat panel TVs (when it’s a great deal of course).
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I use one card: Chase Freedom. 3% cash back on top 3 categories, 1% cash back on everything else.
I have 2 more cards that I keep open as backup or if I am taking a vacation and want to track expenses specifically for that excursion.
I use my card for everything and pay it back weekly.
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I have two credit cards, only one of which I actually use. I get cash back every year on the card – 1.25% I believe. It is a no-fee USAA Visa. I am actually considering switching to the Fidelity card for the higher cash back percentage.
I only use it for convenience. Nothing gets charged on it that I don’t have the money in hand to pay for. Some of my automatic payments are set up on it (cell phone, gym etc.)and I use it to pay for travel related expenses.
I have always paid my card in full every month. However, I will admit that I used to be surprised on occasion by how big my credit card bill was because I had forgotten about some things that I put on the card. These days though I just don’t wait until the bill comes. Every week when I update my budget and pay bills I go online and pay the credit card too. Helps me keep a much tighter rein on it and I never get surprised by things (even I can remember what I put on it a week ago).
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I currently have 2 cards, and I’m switching one of them to a cashback one at the moment. I use cash for day-to-day things, and debit for most exceptional expenses, although I will probably switch those to the new credit card for the cashback. I’ll keep cash for weekly budgeting though – it’s just so much easier for me to see what I’ve spent that way.
My “secondary” card is not kept in my wallet, so that if it gets stolen, I can still live while I wait for new cards (learning from experience). I used to use it for all internet purchases, but I’ve stopped doing that mostly now.
I pay both cards off in full by direct debit, so I have to know that the money is there! I do consider them as “emergency cushions” though – if I really do need something (e.g. if I was stranded away from home and needed to pay for accomodation and alternative travel home), I can use them, and have enough time to transfer money from savings that isn’t accessible via my current account’s debit card.
One question though: I always ask for a lower maximum than I’m offered – to what I feel is a “sensible” amount to have to spend in a month. A couple of times, I’ve raised this temporarily for a particular transaction that I wanted c-c safeguards on, or permanently to cope with inflation, and I’ve never had any problems doing this. But I wonder, does anyone else? And why? I don’t know if my reason (reducing the ability of a thief to spend all my money) is actually a good one…
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Credit cards are simple. After using them, budget as if you have already spent that money.
I never pay attention to the amount when my cards are due because that amount is meaningless… just a behind-the-scenes transfer of funds already spent. I just run through to make sure all the charges are reasonable and an immediate payment of whatever the balance is.
Then, I check the rewards to see all the goodies I earned from spending money I would have spent anyway.
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I use the Chase Amazon.com card. 3% back on Amazon.com purchases, from whom I buy frequently, 2% on gas, dining, drug store, and travel purchases, 1% on everything else. All my bills that allow credit card payments are auto set to be paid by the card as well to maximize points. About every other month, I get $50 back. I am considering the Fidelity 2% Amex card, but I like Vanguard better for my investments.
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My first credit card at 18 was a Capital One Platinum card… simply because I needed to establish credit. It had a $500 limit. Seven years later I still have that card, in addition to a few others.
Thankfully I’ve never had an issue with credit cards. After letting my first credit card balance revolve once I realized how ridiculous that was. Why was I paying extra money for something when I had the money in the bank to pay it off in full? Ever since I’ve paid my credit cards off every month.
My second year of college I got a Chase Amazon Rewards card. I was buying a LOT of textbooks and Amazon gave 3 rewards points per dollar for purchases on their website (and 1 point per dollar for other purchases).
I’ve used this card as my main method of purchase since 2005. Since I no longer need to buy textbooks, I save up my Amazon Rewards certificates all year long until Christmas when I use those to subsidize Christmas present expenses.
The other card I use somewhat frequently is my Capital One No-Hassles Miles card (which is basically the same as the cash back version, you can just choose to get miles, gift certificats or cash back). I got this card in late 2007 in preparation for a 3-month backpacking trip through Europe. Capital One does not charge a service fee for use overseas unlike my other credit cards. It worked out quite well.
I would recommend either of the two cards I use the most. I’ve had no customer service problems with either Chase or Capital One.
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I have 2 cards a Discover for the points.
A Citi Visa that I keep for the credit limit on it. I recently had to float a funeral for a few days on my Visa card.
They are mainly for convenience & emergency use paid off monthly.
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Let’s look at the other side of credit cards – from the business that you make a purchase from. . .Did you know that the company(mainly the small business) gets charged 1-5% each purchase and even a charge if it is declined! So help out the small business around the block and pay by check or cash. Otherwise a good portion of their money goes right out to the credit card companies!
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I love the the descriptor clause you use “my wife — who is always right —”. It’s the same in my house. If you’ll take some unsolicited advice, I suggest that you use this phrase EVERY time you refer to your better 51% in this blog.
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A Hilton Honors AMEX. I travel a lot and stay in Hiltons. It produces points in conjunction with the HHonors program, enabling me to earn several nights per year in hotel stays for family events.
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I have 2 credit cards which don’t do me much good: an AmEx Blue for Students (which I got suckered into as a college freshman, and which might have destroyed me had it not been for a low credit limit), and a Bank of America rewardless waste of wallet space (with an irresponsibly/unnecessarily high credit limit). Thanks to a money-savvy wife, I now carry no balances and use these responsibly. What I would really like to do is scrap the AmEx, however, in favor of a card a friend recommended, which is one of the AmEx cards offered by Fidelity. Depending on which card you choose, you can earn 2% (the site says 2% – not UP TO 2%, although who knows if that’s just fluff?), which can be immediately invested in a Fidelity IRA or a Fidelity-managed 529 college savings account. With the 529 card, family members can link their own cards (read: not cards under your account) to the 529 account to help you save. With my first kid on the way, it’s a strong consideration.
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My husband and I have everything separate. We share one card, an Amex Platinum, and it’s the card we use for everything, unless they don’t take Amex and then we use one of our own, non joint cards. Yes, the annual fee is expensive. 100% of the reason we have it is because of the points. Namely, the points transferring to Continental frequent flyer miles. We fly out of Newark, which is a Continental hub, so we get all of the perks that come with the card. We used the points gained to buy one first class ticket, and then one full fare first class ticket to Hawaii for our honeymoon last year. And we plan on doing it again for the return trip in 2011. With this, and the added travel insurance that their concierge service gives you, the annual fees have more than justified themselves. Plus, two times my husband’s card had been compromised, and they called him within hours. They even overnighted a card to him while he was away on business. We also pay it off just about every month (this past month we didn’t, and I believe it’s the first time ever we’ve carried a balance). Points are useless if you’re wasting the saved money on interest.
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I have 3 cards at the moment, but only one in active use. One is a Chase Amazon Rewards card (not using), one is a USBank FlexPerks card (used only for quarterly trash collection bill) and an AmEx Starwood Preferred Guest card that I use for some monthly bills and travel/big ticket items.
I used to have a balance– I rang up several grand during grad school on the Chase and USBank, but finally paid that off early this year. Now I use it just for convenience and rewards, and I pay off the balance monthly. In the next month or so (before the annual fee on the AmEx kicks in) I need to take a look at my spending habits and see which card gets me the most in the way of rewards. I have a feeling the Amazon Rewards card will win out, as I don’t put enough on a card in a year to justify an annual fee.
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We actively use two credit cards, Discover More gives 1-5% cashback on normal purchases and up to 30% cashback in some cases if you use their online portal to jump off and shop online.
When Discover is not accepted we use a Wells Fargo rewards card that gives 1% cashback to the principal balance on our home loan.
We should probably shift from using Discover as the primary card to using Discover as the secondary card as we kind of get double benefit from the other rewards card in the form of cashback and reduced interest as a result of the lower principal.
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We use Citibank for the rewards. Only use it when we can pay it off and don’t use it just for “fun” stuff.
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We have the same one you do. It gets paid in full every month because we treat it as a debit card. We use it instead of a debit card because of the cash back. If we ever start using it as a credit card, it will be cut up.
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I look for two things in a credit card:
1) cash back vs. points – points are rarely worth it, they tend to encourage me to spend the way the card wants you to – i.e. I had a Sony card and definitely bought more Sony gear than I would have otherwise — that said I was happy w/ all my purchases but still. I could see myself doing the same with airlines.
2) Cards without foreign transaction fees, because why make travel even more expensive?
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I use an Amazon VISA (points) almost everywhere and Mastercard (no rewards) few times a month just to keep it healthy
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I stopped listening to Dave Ramsey on credit cards when he said on his show: “Debit cards have the same protection.” That is absolutely not true. We started with debit only and moved to credit cards for the cash back. They are paid off in full every month. Why not make $ on things I am buying already.
The credit card protection proved itself when I purchased a textbook from an online seller who attempted to raid my account. The credit card company caught it quickly. If I used a debit card my account would have been raid and I would still be fighting with the credit union to get my $ back.
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I am in the U.K. and I have a Barclaycard Cashback which pays a small percentage on all purchases incurred in the month.
I use this card for all day-to-day expenses each month: food, petrol, clothes, eating out (which is very rare nowadays) and so forth. However I use this card like a debit card. I do not merely pay off the balance in full each month– I pre-pay next month’s expenses too. So my credit card has a positive balance for 90% of the time, except when there is an emergency or I overshoot slightly towards the end of the month. If the budgeting goes well, I end up with a zero balance when the credit card statement arrives. And yes, I do budget very strictly and keep a daily balance of the amount left to spend on an Excel spreadsheet.
Note that the credit card company do not like me doing this and will only let me pay monthly in advance if I pay by cheque (not online.) Why do I do it? For the cash back, which is substantial over the course of a year!
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Capital One with cash rewards. We earn cashy money on everything. The interest is high, but since we pay it off every month, it’s literally money for nothing!
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I have a Schwab 2% cash back card that I use for absolutley ALL of my purchases. With my modest lifestyle I made about $750 last year in cash rebates which I invest with Schwab in a low risk mutual fund. I’ve had a credit card for 30 years and never carried a monthly balance.
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Bank of America, some fancy VISA card. I use it for any online purchase, netflix, cell phone bill (easy pay), Vacations, Travel,
I have used it for down payment on car purchase, and various other things I can’t remember now.
It is a points card, I never carry a balance. I probably spend 8k-15k a year on the card. I get roughly 1 point per dollar spent. Very low Intrest rate and very high credit limit b/c I also bank with BoA. I could probably find a better rewards card but I find BoA online too easy to use and I have never had to call and fix a issue.
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I am using the Bank of America Cash Rewards card. I get $25 for every $2,500 I spend. I pay off the balance monthly. I like using it.
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I trust myself more than many of these blogs that preach no credit card usage.
I only use the credit card for 4 reasons:
1)transaction tracking
2)paying off a predictable payment at a certain time in the month, or even more than once per month
3)protection from fraud or fat-fingered mistakes. Let’s say someone rings up a dinner bill as $2000 accidentally. I dispute and don’t pay until it’s resolved.
4)small emergencies where I wouldn’t take out a loan
I never thought to use a credit card to spend money more easily or money I didn’t have. Carrying a balance is a bad idea.
Citicards are the devil. I had a card with them that I built up from college and it started with a $500 limit. Over time my credit grew and I never carried a balance. They would refer to me as a deadbeat, since I don’t actively make them money. Eventually my credit limit was $25,000 or so and I kept getting letters that my interest rate was going up. My credit score has never been better, it is very good. I called them to see if they could lower the rate – while I don’t use the interest penalty regularly, what if I had a small emergency, I don’t want to be charged 24.9% interest to use my credit card. It was insulting. They offered to drop my rate 2%. I told them do it – but I will use this card 1x a year to buy a pack of gum and that’s it. I’m just keeping it as an open line of credit, nothing more.
I went to USAA that day, and in 2 minutes had a new credit card account at 8.9%, without even talking to a human. USAA rocks. Their checking also has ATM fee reimbursement up to $15/month!
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I spent a week in a 5-star hotel (500 Euro/night) for free in Rome this summer thanks to points racked up using my Starwood Amex. We use it to pay just about everything and never carry a balance.
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We have a few we use for different purposes. I always swore I’d never pay for a card, but my husband has a Citi Premire Pass (the pay version, unlike Henry’s), which gives us points for every dollar we spend and every mile we fly. It basically doubles our frequent flyer miles. We only have DH on the card because then we only pay for one membership per year; if I fly with him (which is all but a few flights a year), I get the miles too. Since we fly home a lot, this card really racks it in. We use the points for tickets (rarely) and store gift cards.
For everyday uses, we used to have a Citicard. Their ThankYou Network was amazing, but has scaled back during their recent troubles. Now we’ve switched to Chase’s Amazon card, which offers us more points for the dollars we spend. We charge everything (balance paid off every month) so this racks up. We just got $250 cash for the year’s spending!
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My wife and I have 2 cards that are both set up to pay the balance off monthly in full from a savings account (no worries about cash balances in checking).
chase rewards: old card no longer offered that gives 5% back on gas, grocery, and drug stores. We only use it for those purchases.
schwab invest first: which gives 2% back to a brokerage acct monthly on any purchase. We pay every monthly bill we can from this card.
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Folks, I have to leave for the gym. I won’t be back for a couple of hours. Unfortunately, nearly every comment is being routed to spam. I will approve your comments manually when I return, but for a couple of hours, your message may fall into a black hole. I apologize. Thanks for your patience.
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Like many others posting, I have a Chase Freedom card. Every few months I get a $250 check in the mail, and I pay it off every month. It’s like getting paid (albeit a small amount) to buy things I would have purchased anyway.
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I pay all my balances in full each month, so the only thing I really look for in a credit card is which one will give me the most cashback. That said, I have a few cards that I carry in my wallet:
1) Citi Forward
I use this card exclusively at restaurants as it gives 5 points per dollar, which could turn out to 5% cashback if redeemed for the right gift card. Same applies for books, music and movies. One tip is if you use this card for Amazon purchases, you get 5 points even if you don’t buy books or music, which is better than using the Amazon credit card.
2) Penfed Platinum Cash Rewards
Exclusively for Gas. 5% cashback credited to account after each month. Also currently they are offering 3% cashback on purchases from certain stores including eBay and Paypal.
3) Fidelity American Express Card
I use this card for everything else not covered by above cards, as it offers 2% cashback on any purchase.
4) Capital One
I don’t carry this in my wallet but it has it’s uses. When purchasing from a store located in foreign country or when traveling abroad, I use this card as there is no foreign transaction fee on this card as mentioned in the post. Typical cards usually have 1~3% fee.
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We have a Chase Toy’s R Us MC and a Discover card for the backup.
We got the Toy’s R Us card when our first child was born and every month we get between $10-$40 in gift cards. Originally we used it for diapers and other baby-care needs, but now we use them for Christmas, birthday, or when Daddy wants a new videogame.
Now that both kids are in elementary school, it has been a godsend for the numerous birthday parties they get invited to. We just grab a gift card or two and grab a present without impacting our budget.
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Capital One Cash Back. Just 1%, but we travel a lot. No forex fees for us.
We don’t spend it if it’s not there in the bank.
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I really only have a credit card for building credit. Each month, I use it to make a small, recurring purchase, and pay that off as soon as I see the bill online. My understanding is that part of your credit score is based on how much of your available credit you’re using at any given time(so even if you pay the bill off in full each month, using almost all your credit limit can still hurt your score).
For most of my purchases I use my debit card: Just as convienient as a credit card, but less risk to my credit score.
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I actually have 3 right now… as someone above mentioned, the Chase Freedom card changed recently, and I think I may be canceling. I really like my Citi Forward card… 5% back on restaurants and bookstores.
Then for all other purchases, I have an awesome card from my local credit union: 5% on gas and 1.25% back on everything else, applied directly to my bill each month!
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I do not have a credit card and it will be a cold day in Hades before I ever get another one. I haven’t had one for 2.5 years now.
I paid off my balance in December 1994, then for the next 13 years, proceeded to pay it off in full every month – always early. I didn’t care about interest because it didn’t apply to me. I played the game with the credit card company’s on moving my dates, etc., and they were hard pressed to get by me – a true nerd. They tried…
When I moved to another state about 3 years ago, I ran across my credit card folders. I had kept every statement since 12/94. I had spent over $150K dollars.
Instead of having a chance at a secure retirement, I, instead, have a nice stack of paid for credit card statements.
Me, and mine, won’t have credit cards.
I use my debit card with care because it doesn’t have the same safeguards as credit cards do – if you say at the checkout counter “credit”, it does have the same safeguards. If you say “debit” and use your PIN, then you have to be prepared to go to war over the charges. I have gone to war over the charges twice now, after filling out a police report, going to the financial institution, and thus, spending hours to get the charges removed. It is a pain to do.
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