"Rewards" credit cards

[ToomuchStuff]

The current posts on cc made me wonder a few things. How many of you have "rewards cards"? I word it like that, because I also wonder, do you pay for that? My credit card company, tried to get me to "sign up" for their rewards program and most of their "rewards" were not stuff I would use, and I couldn't understand how the fee (waived the first year), made it a reward.

What kind of rewards do you get?
Onto debit cards
I saw a similar argument the other day, when a couple came in and neither carry cash. We only take cash or checks (just because Visa falsely advertises "its everywhere you want to be", doesn't make us responsible for it). They started arguing that they didn't want to pay a fee (to use the atm), and I was confused about how paying more because someone accepts plastic (if we did it, it would cost you 10% more), isn't a fee.

Thanks:+1:

[bae]

I use "cash" as my "rewards card", and usually negotiate a cash discount, so I get the reward up-front.

[decemberlov]

I recently signed up for a target card that comes directly out of my checking acct and i receive 5% off when i use it. I've never owned a credit card in my 30 yrs and don't really plan on it either. I'm uncomfortable spending money i don't have.

[sweetana3]

I have never ever paid for a CC as an annual fee. And never paid interest. Both Discover and our Amazon affiliated Visa pay us in either cash or discounts.

[iris lily]

With my dentists and optician like bae, cash is king and we get discounts, pretty significant ones. Dentist gives 10% off for cash, optician gives 30% off eyeglasses and something similar but lower to an exam bill.

I finally switched to a cash rewards card, but it rewards at only 1%. I know that there are higher reward cards. How high is your highest WITHOUT an annual fee? I;m not paying any annual fee on principal even if in the long run it turns out to generate more cash for me.

[ToomuchStuff]

I use "cash" as my "rewards card", and usually negotiate a cash discount, so I get the reward up-front.


Thanks Bae et all.
I am a cash person mostly as well (cc use for online stuff and for work). I am trying to understand if people actually, truly get a benefit, or just a perceived benefit. (the later is my experience in physical people I know)

EDIT: Iris was posting as I wrote above. I pay no annual fee's, nor am I a rewards member. I have two store cards, that I signed up for, only due to the discount, that I should close (cards are unused) and one CC (as stated above, mostly for the online and work stuff, which I get reimbursed for the day of the bill, BY MY CHOICE). They would pay me sooner (as I ordered) but I like to take the money and go pay it off that day (or the next if I take it in on a work day)

[iris lily]

Thanks Bae et all.
I am a cash person mostly as well (cc use for online stuff and for work). I am trying to understand if people actually, truly get a benefit, or just a perceived benefit. (the later is my experience in physical people I know)

Skeptical like you, I put off getting a cash back card for years. I did figure out recently that I only lost about $80 - $120 per year by not doing it. DH puts thousands on his card each month, but he does that for his business. That really pays for us.

But now I've got a 1% cash back card, and I think I could have done better.

[ApatheticNoMore]

No, dont' use reward cards for a reason I gave in that thread, wary of subtle psychological trickery. Really you can say it doesn't cause you to spend more, and I could *maybe* see that if it's only used for necessities, but awareness that a reward is there in the back of your mind can't help but have an effect. I speculate this from basic research on priming, unconscious priming, unconscious motivation in psychology (though hey you know the marketers must have more data than that).

https://en.wikipedia.org/wiki/Priming_(psychology)

IOW I'm paranoid :D. And I do realize I could probably extend my reasoning to drive myself insane. Anyway, my credit card doesn't have an annual fee either, which is good.

[Tammy]

We have a Amex thru Costco with 2 or 3% cashback. They take 50 off the cashback each year, and we get 300-500 back annually.

So on other thread I just lied, cause I said our cards have annual fees. That 50 is a fee. We can say I mispoke. ;)

[Tammy]

We have a Amex thru Costco with 2 or 3% cashback. They take 50 off the cashback each year, and we get 300-500 back annually.

So on other thread I just lied, cause I said our cards have annual fees. That 50 is a fee. We can say I mispoke. ;)

Meant to say "have NO annual fees"
Can't find the edit button ...

[try2bfrugal]

If you have a budget and come in under budget each month, then a rewards card can make extra money each year. I don't spend less because I have no spend days. I don't spend more because I use a credit card. I track every expense from bridge tolls, to $1 used books at the library sales, to the occasional frozen yogurt stop. I follow that budget very closely and usually come in under budget each month.

You have to do what works for you, but the aspect that manages our spending in our family is a closely followed budget, not what days I spend the money on or whether or not I pay cash or use a credit card. If you can get a discount for paying cash greater that your credit cards rewards then that can be a good deal, but I doubt you can get discount for paying cash for 100% of your expenses, especially at places like Costco, Kmart, Safeway or Verizon.

If you make an extra $400 a year in rewards points that can be the equivalent to earning an extra $600 or so in taxable income depending on your marginal SS, state and federal tax brackets. If you can get $400 a year in rewards points that would otherwise take $600 of taxable income to equal, then over 30 years that could be equal to earning 18K.

If you don't track expenses and don't pay your cards off each month, then having the rewards cards might cost you more in extra purchases and interest than you would save in rewards.

[ApatheticNoMore]

I think it's more subtle than that, in that if you have rewards for spending it might lead you to spend more even with a budget, because since you are rewarded for spending you may not have as much incentive to come in UNDER budget. But with a budget is definitely better than without. Maybe I idealize some far less psychologically complex form of capitalism (ie a marketplace *without* the marketing) where if you buy the shiny it's because you really want shiny, and not because marketers are subtly influencing. I know the line isn't hard and fast, I just steer clear of what I think are traps.

Anyway I really don't care whether or not anyone else uses rewards cards and even my opinion on the matter for me isn't absolutely fixed, just my thinking as of today.

[Florence]

We have a rewards card. This month we are using our miles to fly round trip from Houston to Boston for $10 each.

[Greg44]

We have the Costco Amex card that pays cash back.

We also signed up for the Chase United Visa to keep our miles current - seems we haven't flown much in the last few years. My dw used her "free miles" this summer to fly to Washington DC. Tickets from our town would have been nearly $ 900.00 so I guess the free miles paid for itself -- even with the $ 60.00 per card fee. I am not sure if I am going to renew this year because of the yearly fee.

[rosarugosa]

We have a Chase Priority Visa which does have an annual fee - waived the first year. But we walked into it with our eyes open and here is our rationale: we get one "free" night per year at a Holiday Inn hotel. I know that translates to one $50 night per year at a HI hotel, but that's a good deal in our book. We redeemed our freebie this year at Holiday Inn by the Bay in Portland, ME, and that runs $99 - $199 per night depending on season. This place has rooms half the size of our house, with huge window-walls overlooking Casco Bay. It's a very cool place (Merski would understand). They also wooed us for some years, and we succumbed when they gave us five free nights worth of points for joining. We use our points that we acquire through purchases to get rooms for $60. per night, because that actually works out better with the point redemption scale than redeeming for free nights. We mostly use the card for gas & groceries, and the occasional big bad car repair while on vacation :(
We have a new rewards card through a local bank that gives us 1% cash back - or we could redeem for gifts. We signed up because they offered us $150 cash if we used the card once. They made good on that offer, and there is no annual fee on that card.

[herisf]

I have a no-fee rewards card where I get points towards a list of various vendors. I deliberately went through my regional bank because more of my spending gets awarded towards those points, and I made sure that the offered vendors were one(s) I would use. And then I use those points to get gift card(s) from Barnes & Noble, and that's how I get my e-books :cool:. This allows me to get e-books I want and keeps that spending in check. I rarely buy e-books when I don't have a gift card on file (I haven't done so in over 2 years).

Mind you, I have frequently already read the book from the library and have decided that this is a book that I want on hand, or I like the author well enough that I know I will continue to read the series (I get the first book in a series from the library or PaperBack Swap, as I've been disappointed with series starts in the past, even with authors I like a lot).

[ToomuchStuff]

I have been cutting back on spending because of (see my name), so in most cases, I don't know how rewards, would be. I am still thinking about an ereader (less wear on the body then sitting at an angle, in bed, with the netbook), but don't want to spend the money yet (would prefer the price come down some more). As for cash back, if my estimate is right, 1% back would bring me about $20 a year, so I doubt I would really see much benefit to one.

Thanks all.

[Spartana]

None of the 5 CC's I have have an annual fee, and if they cahrged one I would get rid of the card rather then pay it. All have some kind of reward program but since I use cash almost exclusively, I have no idea what they are. I keep the CCs for travel as it's more convienent then cash and pay them off in full when the bill is due so never pay interest either. No annual fees plus no interest paid ever makes me a "deadbeat" in the eyes of the credit card companies :-)!

ETA: For those of you, like me, who have no-annual-fee cards and use then rarely - if ever - be aware that often times ther CC companies will drop you and cancel your card (often without any notice) due to lack of use. This happened to several people I know. So I now use my cards each a few times a year (but still continue to pay them off in full without interest each time I use them) to keep that from happening.

[Lainey]

My bank is pushing me to 'upgrade' my credit card to a reward card. I'm just not interested in using my life energy to track "points" for "rewards" I probably don't even want. The few dollars it might save me just isn't worth it.

However, if I had a big spending spree coming up - house repairs, new furniture, fancy vacations, etc. - I could see where it might make sense.

[sweetana3]

We dont track anything as it is just not worth it. We use the points to get discounts for things or companies we already use. What is there is there and it is just a nice benefit.

I would not chase points for flying because I dont want to be limited to one airline for a flight. I had a freind once who landed four times to just use her Southwest points. I could get there with one stop.

[militaryman]

I have a "goto" rewards card through Pentagon Federal Credit Union "Platinum Rewards Card" that give points -
5 points for GAS per dollar spent -- ( I average 1500 points per month in gas points )
3 points for Supermarket per dollar spent ( I average 1000 points per month in grocery points )
1 point per dollar for all other purchase ( I average 2000 points per month in other category points )
-- I then spend the points to buy visa gift cards 10,000 points is $100 card
HOWEVER If a credit card company sends me an "offer" to open a account and spend, say, $500 within first three months for $100 cash then I grab it, do the deal and then close the account after rewards are cleared

I have gotten well over $1000 in cash rewards this year doing this

I have developed a little system of keeping track of the offers and timing so I maximize my return on any time spent doing the deals

closing the accounts is the key because then it just resets you in their computer and a couple months later BAM another offer

I have also opened a chase checking account for a $200 dollar bonus deposit ( only hitch was keep it open 6 months and deposit $1500 to keep no fees) no direct deposit was required -- easiest way to get my cash $$ working for me!

Also I watch my credit score and it has NOT been hurt at all and I have been doing this system well over a year.

I have also done a CC deal and gotten $400 off airfare this year