Credit Card Cash Reward$

[rennigade]

Airline rewards are notoriously difficult to actually use.

This directly correlates to the individual. If you're not flexible then yes...they are very difficult to use. They're difficult for my parents to use since they have certain dates/times to fly. For us...we've never had an issue other than one time with british airways...and that was mainly because their website sucked years ago.

You may have to arrive at 7pm at night instead of 1pm...or you may have to fly out on a weekday and get back on weekday. In my experience southwest and american are the best.

[Drake3287]

The exception to this is Southwest. We earned SW miles (plus 50,000 bonus for opening card) for 4 years while DD was far away at college. Their miles correlate with ticket prices, and you can use them for any flight. Added bonuses on SW: 2 free checked bags and if the ticket price drops you can rebook & get credit (or cancel and get your miles back). This works great with miles because the miles just go back into your account.

She graduated, and we switched back to cash earning credit cards.

You right about that one. SWA is the only airline that allows you to use your reward points anytime you want assuming they have an open seat.

[~bs]

or you can use a chase card and redeem at most airlines with no blackout date. if you book through their site, you get an extra 20% or something for your points.

[Gailete]

I am looking forward to the day that I can get my cards paid off and do the charging everything I can to earn the rewards. Even most doctor's offices if affiliated with a hospital, you can charge your visit when you get a bill. Which would help with hubbies co-pays.

[IHateCreditCards]

Be very careful - points & cash back programs seduce many deep into debt

This isn't meant to sound like some humble brag or anything, just a comment about how great some of these different cash reward credit card programs are and why others don't do the same as me. You certainly don't need to be wealthy to make some easy money off these.

I just "cashed in" a bunch of reward credit's with my BofA Visa Travel Reward credit card today and was curious at how much I've made during the last 12 months and it comes to $2,290.21. That's pure cash back in my pocket for doing nothing other then charging everything I can on a credit card and paying it in full each month.

It use to be I used a United Mileage Plus Visa credit card for charging but even when I earned enough points it was nearly impossible to get the free flight I wanted. Plus these flight points didn't add up in cash value to anything like these cash reward cards do.

For those of you that trust yourself to pay your credit card in full each month, you really need to look into getting a cash reward card. Like many others, I charge everything, literally everything including almost everyone of my monthly bill's and use this "free" money towards vacations each year.

So why do banks offer such "generous" credit cards with all kinds of "free" benefits? Is it because they are your friend? Or could it be that these relatively small "free" perks are so seductive that people struggle to resist them and then often end up racking up so much credit card debt that they end up paying WAY more in interest and fees than they receive in rewards and cash back? One of my close friends who frequently talks about all the "free" business class flights he takes on vacations confided in me that he once calculated how much interest and fees he paid on his credit card balance and was stunned to discover that it was MUCH more than the value of the "free" stuff he got in return.

Think of the credit card game as similar to gambling at a casino. The house sets the rules and the house always wins. You may get lucky, but you are playing a dangerous game. You never know when you might lose your job or you or a family member might end up with a serious illness that incurs huge medical bills.

Michael

[rennigade]

Just because someone sucks at controlling how much they spend on a credit card doesnt mean it sucks for me.

I game the system all the time. We just did a bunch of house renovations. My wife and I signed up for a credit card...spent the $4k/each to get the bonus offer (we had $8,500 hardwood floors put in) and cashed in the rewards for $1100 in gift cards...mostly at Target but a few at homegoods and home depot. We paid the cards off at the end of the month in full...didnt eat any interest. No annual fee. Explain to me how I lost? Id love to know.

Start looking in the mirror. The person you see is the problem...not the cc companies. Time for individuals to start taking responsibilities for themselves.

[disneysteve]

Very true. I'm so tired of having people tell me I'm spending more because I'm paying with a credit card. No, I'm not. I'm sure some people are but I don't base my spending decisions on how I plan to pay. I base them on how much money I have to spend. I would make the exact same purchases with cash or check or debit card.

We get hundreds of dollars each year in credit card rewards, both cash back and free hotel stays - all for purchases we would be making anyway. We never pay a penny in interest. We do pay an annual fee for our main card but the rewards greatly outweigh that fee.

[disneysteve]

One of my close friends who frequently talks about all the "free" business class flights he takes on vacations confided in me that he once calculated how much interest and fees he paid on his credit card balance and was stunned to discover that it was MUCH more than the value of the "free" stuff he got in return.

It shouldn't have taken too much calculating. Most rewards are paid at 1% of charges while interest can be as high as 30% and average is probably around 17-19%. If you aren't paying your credit card bill in full each and every month, no rewards program is going to compensate you for the interest you are throwing away.

Think of the credit card game as similar to gambling at a casino. The house sets the rules and the house always wins.

This isn't true at all. Lots of people - 62% by the stat that you posted - don't carry credit card debt. They pay their bill in full every month. They aren't paying interest. They are benefiting from the rewards.

Credit cards are just another financial tool. Used properly and responsibly, they can be very beneficial.

[Drake3287]

Of course the credit card companies aren't doing this to be nice guys, they ultimately hope you carry a balance and pay interest plus they still make money off the businesses your charging at.

These card's are realistically meant for the few of us that can control credit card purchases and are willing to pay them off in full each month. I think many of us that are financially conservative with our money tend to have money in the first place simply because of these financial habits.

I for one haven't paid a cent in credit card finance charges in 20 years but in return I've received thousands and thousands of dollars back in cash. Pretty good deal in my book for those of us willing to control ourselves!

[rennigade]

Of course the credit card companies aren't doing this to be nice guys, they ultimately hope you carry a balance and pay interest plus they still make money off the businesses your charging at.

If it wasnt for those who carry a balance and pay interest...responsible people like myself wouldnt reap the rewards. Those juicy offers wouldnt exist.

I have no issues with people paying the minimum per month...but when someone demonizes a company and tries to pass the blame on to someone else...I do have a problem with that.

[disneysteve]

I have no issues with people paying the minimum per month...but when someone demonizes a company and tries to pass the blame on to someone else...I do have a problem with that.

Exactly. Everybody likes to pretend they're a victim. The CC company is evil for charging me so much interest. Well stop carrying a balance. The CC company is evil for charging me a big fat late fee. Well then pay your bill on time. The CC company isn't doing anything wrong in these situations - YOU ARE.

[Singuy]

There are reward card pros and will do things no one ever imagine.

A co-worker is learning the ropes. He would sign on those reward cards that give out 100k points after spending 3k, but there's a mandatory 700 dollar fee. The card also gives you 400 dollars in travel points/year or whatever.

He will sign up for this, and then transfer his max limit to a different card, essentially reducing the limit on this card from say 20k to 3k. Why 3k? Because by law they can't charge a yearly fee if the charge is more than X percentage of your maximum credit. Now my friend's yearly fee is waived forever but still gets the 400 dollar travel credit every year for essentially nothing.

Scheme #2 he is running when there's that 5% at a particular store reward(like 5% groceries the next 3 months), my friend would go buy massive amount of Visa gift cards from a groceries store, and then goes to the post office and covert Visa gift cards into money orders, and then convert money orders into cash.

These are the loopholes these people are playing with. And you thought your 2% reward card was so slick.