Poll:Using credit cards for monthly spending

[ERD50]

Quote:

Originally Posted by fireorbust Well it's fairly apparent that the CC is the way to go. I've just been worried about overspending due to the ease of "letting it ride". Don't know why I worry about debt so much (because we have none I guess). Just seems less stressful to pay as you go. I'm going to try going the CC route for a while and see if our spending habits change. Hard to move from the savings mode to the spending mode

I believe the key to this is something that most posters here implicitly understand, hence the poll results so far (almost unanimous in using the card for the cash back - currently 30-0-1 for use CC, no, sometimes). That is, every purchase should be considered for its value. Sometimes that is being frugal, sometimes that means spending in any way you feel that brings joy (see the "Blow that Dough!" thread).

From my perspective, the OP question should be - "is there any reason I wouldn't want to take a 2~4% discount on most things I buy, and have 20 (more?) days to pay?" Really, that's what these CC rewards give you. You get a discount on purchases, you get some lead time to arrange your cash flow to pay off that CC at the end of the billing period, that is great. For example, I may have a big expense, say total HVAC replacement. $10,000 or more. I pay by CC, get 2% off ($200 in real money), and I have plenty of time to make a transfer from my brokerage account if I need it, so my money keeps working for me.

To my mind, if your spending habits change because of the availability of your money (which is your money, regardless of availability), then you need to re-evaluate your relationship with your money. If having a CC makes you spend it easier, you have a problem with your relationship. Maybe not having a CC is a needed crutch for you in that case, but you would be far better off to develop a sound relationship, and then get most everything you buy for a 2-4% discount, and take advantage of the float.

edit/add: Our Costso card is 4% on gas, 3% on restaurant, our Fidelity card is 2% on everything, so 2-4%.

-ERD50

[ERD50]

Quote:

Originally Posted by Dtail Why a public poll?

I think that got fixed, refresh and try again. -ERD50

[Kwirk]

We have (as most here probably do) the full amount automatically paid from our checking account each month. We would have to go out of our way to "let it slide."

[GalaxyBoy]

I've been known to put a $0.50 purchase on my cash back card. Plus, all my CC transactions download to Quicken where I track my spending, whereas I have to remember to manually record cash. Pay it off each month, of course.

[ERD50]

Quote:

Originally Posted by GalaxyBoy I've been known to put a $0.50 purchase on my cash back card ...

Yep. If I don't, I end up with some metal discs in my pocket. Now what the heck am I going to do with these?

-ERD50

[audreyh1]

Quote:

Originally Posted by fireorbust Well it's fairly apparent that the CC is the way to go. I've just been worried about overspending due to the ease of "letting it ride". Don't know why I worry about debt so much (because we have none I guess). Just seems less stressful to pay as you go. I'm going to try going the CC route for a while and see if our spending habits change. Hard to move from the savings mode to the spending mode

Most of the posters here are quite disciplined about their spending, have little debt beyond mortgage, and aren’t inclined to go overboard with plastic. Most pay their credit cards off monthly, so don’t get into trouble with credit card debt.

Even the folks on the “blow that dough” thread post because they already have the extra money to spend.

[rk911]

Quote:

Originally Posted by fireorbust This has probably been covered a million times but.... We retired about a year ago. 1/2 of our savings is in a taxable brokerage account, the other in IRAs. We spend our monthly needs out of our brokerage account and are living mostly off dividends. Having said all that, we have a Cap One card that pays 2% cash back on everything. Our brokerage pays 1% to 2% on our idle cash. Seems to me, we should be buying everything on the Cap One card and paying it off each month (as we've done forever). Is everyone already doing that?

yes, for everything possible except we use a discover card. we'd use it even if there was no cash back. we haven't carried a CC balance since 1972. discover has superb on shore customer service. that alone is reason enough for us.

[Doribe]

Quote:

Originally Posted by fireorbust Thanks for the quick reply. I'll check out the pointsguy link. I was thinking about setting up monthly payments on electronic "auto-pilot" so we never miss a due date.

I use a separate credit card for all auto payments. It streamlines the statement for easy review and reduces the chance of fraud on this card since it isn't used here and there. I learned the hard way, when there is a breach, it takes a bit of work to maintain the auto-pay machine.

[Bamaman]

We use the credit card Rewards to purchase flights to Europe. Our trip to Spain in June had one of our flights covered. Yesterday an airfare dropped 50% for a few minutes and we grabbed it since I had enough $ in the Rewards to pay for it.

[Dtail]

Try to use a mix of 5 CC's to maximize rewards. They do add up into the thousands for the year.

[pb4uski]

Quote:

Originally Posted by fireorbust .... Seems to me, we should be buying everything on the Cap One card and paying it off each month (as we've done forever). Is everyone already doing that?

Yes. For years we have had 2% cashback credit cards and put all our spending as possible on them (unless there is fee with a vendor for using a credit card). On auto-pay paid off in full every month... so in effect 2% free money.

I've fine with 2% on everything as it is a good reward and keeps life simpler than dealing with rotating bonus reward categories.

Currently use Citi DoubleCash card. It also gives us an additional two years on the manuturer's warranty for a lot of purchases (appliances, etc but not cars).

Our accumulated rewards is close to $1,000.

[Tiger8693]

We use two different cards for everything we can, split between Chase Hyatt (best points/room I have found), and then Sam's Club for Gas (5%0 and Dining (3%).

We did get an AA Aviator card for the sign up bonus, but as with most airline cards, I find the restrictions on which flights you can use the points to travel on makes it very inconvenient to use. Now I am thinking about one of the non-affiliated travel cards where the points are just used for $ to pay for the flight. Have to research them.

[Golden sunsets]

The only thing I use a debit card for is to take cash out at an ATM and I haven't done that since January when I took out $100. I still have $30 in my wallet after 7 months. How is that possible

[WhenIsItTime]

We primarily use 1 card that provides 1.75% back on everything. Keeps it simple.

[Chuckanut]

Quote:

Originally Posted by fireorbust Thanks for the quick reply. I'll check out the pointsguy link. I was thinking about setting up monthly payments on electronic "auto-pilot" so we never miss a due date.

On the CCs I use the most I have an automatic payment of the minimum amount made every month. Of course, I pay off the card each month. But, in the event I forget, at least I don't get hit with late fees.

FWIW, I rarely forget to make a CC payment. I guess I am a bit of a belt and suspenders kind of guy.

[gwraigty]

Yes, everything that can go on a cash back credit card, does, with the balances paid in full. It does add up to $XXX in cash back each year, money that you miss out on by paying with cash everywhere.

[steelyman]

This thread has caused me to review the cash back percent options on the (small) number of cards I regularly use for day-to-day and automatic purchases.

It won’t be hard to adjust my habits/loyalties and double the cash back percent on common purchases (e.g., groceries, gas, pharmacies) by using the proper card. Great nudge to wake up from er.org.

[audreyh1]

DH writes on each card in big market what it’s for, because he can’t keep track of the rewards categories.

[GrayHare]

I hope people realize this cash back is just coming out of your other pocket. Service providers charge merchants more for cash back cards, and guess who the merchants pass that along to, yes, you. tanstaafl

[Mr._Graybeard]

Quote:

Originally Posted by GrayHare I hope people realize this cash back is just coming out of your other pocket. Service providers charge merchants more for cash back cards, and guess who the merchants pass that along to, yes, you. tanstaafl

Me and everybody else, so it makes sense to get my money back.

DW and I had dinner at a restaurant this week that offered a 5% discount on cash payments vs. plastic. That beat the 3% reward we'd have received from Citi. The discount was announced in a handwritten note at the cash register, so I wasn't aware of it until we walked through the door. I had the dollars in my pocket, so I paid the bill and tip in cash.

I've noticed while traveling in greater Chicagoland that some filling stations have different fuel prices for cash and credit. Whether the difference matches the reward my card offers, I'm not sure.