Having heard (and seen) what happens when you live off credit cards or use them to charge way more than you can actually afford, I’ve always been a bit credit card gun-shy. While I know it’s probably smart to have a card or two for emergencies, to build credit, etc., it’s really hard for me to think of any good points about using cards on a regular basis.
But, several PF bloggers (and friends) lately have introduced me to the notion that perhaps owning a card…if it’s a smartly chosen one… could actually play a role in helping your financial situation. How? By using cash back credit cards.
Using credit cards to EARN money
You know how opening a store card to get their percent-off discounts can be smart if (and only IF!) you are careful to always pay the balance off in full each month? Cash back credit cards are smart under the same kind of logic.
It’s like using a rewards card when you shop. You can build points, or dollars, or however the program works, by purchasing things you’d purchase anyway (gas, groceries, etc.)…and as long as you pay the full balance off each month, it’s money in the bank! (You can compare credit cards and their benefits easily online.)
I haven’t personally selected a cash back card yet, but I’m warming up to the idea. I mean, as long as we’re careful to charge no more than our monthly budget allotment for any category each month, we can still pay off each bill in full, and then we have the chance to accrue rewards just for dong our everyday shopping.
What do you guys think? Do you use cash back cards? Which one(s) would you recommend?
~Heart,
Em
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photo credit: 401(K) 2013 by 401kcalculator.org
I drive a good amount, almost $300 in gas a month. I was swooned by the Pentagon Federal Platinum Cash Rewards Visa just for the 5% it gives back on gas purchases year round, it adds up nicely. The rewards are unlimited and are automatically credited to you monthly. No annual fee, no foreign transaction fee (nice if you travel). Penfed.org requires that you be a member by donating to an Armed Forces charity OR if you are military, US government employees, the family or household of existing members.
I joined by donating and find the donation well worth it (and is tax deductible). Although in a different state than I, their loan rates are competitive with my local credit union and their customer service is superb. I ended up getting a used car loan with them and I’m considering a home loan with them also. Cheers!
Sounds like you found some great deals!