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After my son moved across the country, I worried how we/they could afford to visit regularly. I signed up for two (free first year) credit cards that offered flyer miles for a total of 4 round free trip flights and we enjoyed regular visits!
The cards let me earn more flyer points with purchases I already regularly make anyway (gas, groceries, monthly bills, etc) so the miles continue to add up! I always use credit cards instead of cash and NEVER carry over a balance, since I pay it off completely when the bill comes in.
When credit cards offer larger incentives for particular store/purchases, I maximize that as well.
For example; when they offer a larger cash back incentive at any office supply store that I might not normally go to during a promotional month, I will buy gift cards for my grocery store at the supply store, earning the larger cash back at that month. I will then double play that savings when I USE that card my grocery store and earn my flyer miles too!
You need to keep alert to what offers they are offering. I keep a sticky tape on my cards telling me which card to use where.
After the first year was done, I cancelled one card so I didn't pay an annual fee. I chose to keep the other card, since it offered me a $99 companion ticket when I used it for future travel.
One of the sites invited me to sign up my card online and they were having a contest at the time. I won a free 20,000 extra points! One card offered a special 'dining' site that offered MORE free miles when we ate out which coincided with our summer vacation!
It's a fun game I play now! Trying to get free miles, but you can do it with other cards (which I also have) to accrue cash back too!
To save money with credit cards, shop around for rewards credit cards with no fees. Trust me, they want your business; if you look around you'll find cards with no fees. Interest rates may be higher, but be smart: pay off everything in full every month and don't pay those ridiculously high interest fees. The most expensive things you'll buy (if you don't pay off the balance each month) are far more costly than your original bill. Bear in mind, credit card companies rely on you not being able to make full payments. That's how they earn their money.
Keep the habit of paying off the total bill each month and you'll not only earn rewards but also improve your credit rating.
Don't spend more than you can afford!
One trap that many of us fall into is thinking about spending money and using credit as different, when both affect our monthly budget. We may buy something on credit that we would never consider paying cash for. We might even buy things using a debit card, essentially the same as using cash, that we would think twice before we handed over actual bills.
I've been using Quicken to keep track of my budget for the last several months, and one of the first things that struck me was how it categorizes every dollar I spend as an expense, whether it was paid for using cash, check, my debit card, or a credit card. If I spend $50 at the grocery store, it is reflected in my food budget no matter which card I used.
A credit card is a great tool to have in an emergency. If you have a flat tire, you need to get it fixed and don't want to worry about whether you are going to bounce a check or not. Using a credit card allows you to pay off this unexpected expense over a couple months. Credit cards can also be useful for online purchases since they provide more protections than a debit card. But, many of us use our credit cards far more routinely. Any time an expense which doesn't fit right into our budget comes up we charge it. Sometimes we do this because something is on sale and we want to lock in the price. It is very easy to run up a balance on the card, and then we are wasting money on interest payments rather than on things we actually need.
When you go to pay for something with a credit card, ask yourself if you would buy the same thing with cash? Since you will probably end up paying interest on your purchase, ask yourself if you would pay half again as much in cash? Stop thinking of the credit card as a way to avoid paying for things out of your monthly budget.
Try to get into the habit of paying off your credit cards in full every month. You can have the peace of mind knowing that you can take care of your family in an emergency without impacting your budget with the expense of interest every month.
About The Author: Fletcher Sandbeck is one of the founders of ThriftyFun. You can usually find him feverishly typing code to make the site more responsive and stable. He is crazy for Legos, has a degree in mathematics, and is always trying to be more frugal.
Do you have any tips on how to think about credit and spending? Let us know in the discussion.
Whenever you make a purchase using the card, deduct that amount from your checkbook register just as if you had used a check. When the credit card bill arrives, pay in full. Treat your credit card like real money!
Hi everyone! Don't forget to check out your credit cards that offer cash back to see how much reward money you've earned. After looking at ours today I'm happily surprised to find that I now have an extra $130.00 to spend on Christmas!
This is how we turn the painful gas prices into a rewarding experience. If you don't already have a credit card that has rewards, research card companies that have great rewards.
When trying to tackle your credit card debt, be sure to call your credit card company and ask for a lower rate. Tell them that you are shopping for a better interest rate and wanted to see what they had to offer first. They will often try to work with you to retain you as a customer.
The scenario is familiar. At the check out counter of the local department store, the clerk asks if you would like to apply for the store's credit card. As a reward for signing, you receive an instant discount in the amount of 10% or even 15%. Do you sign on?
Looking for a way to earn money? Apply for a credit card with an introductory rate of 0% interest for 12 months when you use the credit card checks....
I use my Citicard "Platinum Select Card" to buy gasoline. You save 5% of cost (about 15 cents/ gal.). It adds up . . .
Don't be fooled by a credit card company's claims that credit cards can help you save money. Finance charges quickly erase any benefits that credit cards offer in cash back incentives unless you pay your credit card off at the end of each month.
Ask a QuestionHere are the questions asked by community members. Read on to see the answers provided by the ThriftyFun community or ask a new question.
I'm thinking about closing a credit card account because the creditor does not want to lower my APR. I've had the card almost 2 year and pay on time faithfully. But if I cancel will the APR continually accumulate on the balance or would it be whatever is left at the time of cancellation? Also, the credit card is through my bank. Do you think they'll make me close out my checking accounts with them?
Tantanisha from Sanford, FL
I know long time ago it was a good thing to CLOSE an credit card account but now they say it can hurt your credit report and credit score in the long run. You can go to www.clarkhoward.com website. He is a consumer guru from Atlanta Ga but you can pick him up on radio all over the country. He says to pay it off and every so often charge something on it to help your credit score. You could also say you got an offer from somewhere else and see if they will match it.
Try asking for a cut in the interest rate at different times-what does nt work at 4 pm sometimes works at 2 am-it s just getting the right person-persistance.
Be sure to read any terms and conditions or the fine print; my last credit card disclosure stated in the fine print that if I do not agree, they can close your account. I usually do call and ask nicely if there is a way of lowering my apr; and in most case they will if you are a good user.
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I always pay my credit card off monthly. I don't have any "perks" with this card. What card has the best perks offered? I don't fly! I also like paying by direct debit from my checking account.
Brenda Catherman from Port Matilda, PA
Apply for Citi credit cards. They offer 5% cash-back on gasoline, supermarket & drugstore purchases, and 1% on anything else. TJMax credit card offers 5% reward if you shop at TJMax & Marshalls, and 1% elsewhere. I have both of these cards and loving it. (05/26/2006)
This is an easy one - LL Bean!! Go to their website and you'll see where you can apply. If you have an LL Bean credit card (through MBNA of America), you automatically get free shipping or monogramming on any items from them. I do the same as you do - I do not carry a balance and I pay the bill off 2 days before it's due (on-line). I use it for the basics: Groceries, cell phone bills, general spending. I must receive $300/year in LLBean dollars, which can be spent on sale items or regular. They aren't just a 'camping store'. There's my idea. (05/26/2006)
I read Money and Kiplinger's faithfully. Both magazines have had articles touting the cash-back cards as the best value in the reward-card category. Here is my suggestion, based on the articles I read:
Definitely get the Citi card... as suggested in the other post. However, you can max out at $300 in cash back during the year. I put everything, and I mean everything, on the card so I will be done by August... maybe earlier considering i just bought a house.
Get another cash-back card - BLUE cash from Amex or the card offered by Chase. My understanding is that the rewards are similar (5% back for drugstore, grocery, gas... 1% back on other purchases) but after you max out the $300 on the Citi card, you can use the other cards. Also, the Amex card gives you the money at the end of the year... I don't know if the "year" starts from when you get the card or in Dec! So far, I have received $150 back from Citi this year... It's great!
GOOD LUCK! (05/29/2006)
I, too, have the Citibank Platinum Dividend Rewards card-- actually we have 2! One in my name, one in hubby's name, so that when $300 cash-back limit is reached on one, we start using the other one!!!! 5% back on gas, groceries, drug stores. CAREFUL HERE!
Not good for those with debt!!! (pay off every month only!!)
Have just started using again because of price of gas-- had stopped using cause we charged too much and were carrying revolving balance :(
Sometimes the problems with tempting (overspending) outweigh the benefits-- you should know yourself and your tendencies-- GOOD LUCK!!! (05/29/2006)
American Express Blue and Citibank Platinum Dividend Rewards are two of the best. AT&T Mastercard was in there too but they're dropping the business as of 6/30/06. (05/30/2006)
We love going on Carnival cruises. They offer a SeaMiles card that is a MasterCard or Visa. You get 5,000 seamiles for signing up, and then I believe up to 5,000 seamiles for balance transfers from other cards in the first 30 days. Also, for every dollar spent, you get a seamile. This card is great for purchasing vacations on any of Carnival's cruise lines (they also own Royal Carribean, Holland America, etc.). You can earn a complete cruise, or use seamile points to earn discounts on cruises. They also have resort vacations that you can use seamiles for. We love this card b/c we can usually get at least one of us a free cruise every other year, and I get a discount towards the second ticket! Hope this helps! (05/30/2006)
We have the Citibank Platinum Dividends reward card that a few people have mentioned already. It had the best rewards when we researched cards 2 years ago, but there may be something better now. Maybe it is time to start looking again... (06/01/2006)
We use Citibank American Airlines for the frequent flyer miles. We took our daughter, husband & 3 children 2 years ago to Disney World in Florida & our flights were free. I also use Discover to get cashback & instead of getting cashback get the gift cards. You can get $50 cards for 40 cashback dollars & other savings. Remember to payoff monthly, if you need to carry a balance use a card with a low interest rate. I also use my cards to pay bills online such as the water bill, cell phone, etc. You have to pay them anyway & you may as well earn a perk for it but do not do it if there is any charge from the company. I just deduct the amount from my checking balance & when the bill comes in the money is available right then to pay. I just check them off. Also, with the money sitting in your account waiting on the bill to arrive, if you get your balance up you can get an interest bearing account & your bill money etc. can earn interest while waiting for your bill to arrive. If you deduct from your checking account any charge etc. you can make money by using a credit card. (06/02/2006)