Mr. Super Frugalette and I have not used credit cards in over two years. I have not missed them. I always have to remind myself that credit cards are not evil. Everything in moderation. Yet, I know that we should probably revisit credit cards this year and find one that offers the best options. I am pretty confident that we want a no annual fee credit card. However, sometimes cashback rewards credit cards more than cover the annual fee. If you are looking to change credit cards, here are a few options:
No annual fee cards….
I went to the Chase website and found that the Chase Freedom Card offers no annual fee. It also offers $100 cash back when you sign up and up to 10% cash back in specified categories.
Citi Planinum Select Mastercard has a zero annual fee and is designed to attract those who want to transfer a balance. Citi offers a minimum 21 months of zero interest on your transferred balance. Thus the credit card pretty much functions as a no interest loan for almost two years.
If your goal is travel, then Capital One VentureOne Rewards Credit Cards may be your best bet. You get 1.25 miles for every dollar spent. Once you spend $1,000 in the first three months, you receive a bonus of 10,000 miles. As previously mentioned, there is no annual fee.
Cash back rewards…
Capital One – Cash Rewards. You receive a $100 bonus after you spend $500 in the first three months. There is a 1% cash back on all purchases.
The Chase Freedom Visa (the one mentioned above) is also a cash back card. In order to get the $100 cash back, you must make $500 in purchases over a three month period. Cash back rewards never expire.
Blue Cash Everyday from American Express offers a $100 bonus after $1,000 in purchases over a three month purchases. Blue Cash also offers a $25 Referral Bonus for each friend or family member who is approved for the card. Blue Cash also increases the cash back to 3% cash back at grocery stores and 2% cash back at gas stations and department stores.
Citi Dividend Platinum Select Visa Card offers $200 when you purchase $500 within the first three months. There are variable cash back rates in different, alternating categories as well.
So what is in your wallet? What perks do you get from your credit card?
Cashback rewards
No annual fees..
Not used a credit card in 2 years is just awesome. I have a Discover card that gives up to 5% cashback for a few things like gas and 1% cashback for everything else.
Honestly, not using credit cards and having only one account just simplified my life.
I don’t like credit cards with annual fees either. I have a few that I use just for the rewards. I don’t keep a balance, so the rates don’t affect me.
I also have the Discover More card. Their 5% categories rotate every three months and cover things like gas, groceries and restaurants. I recently got the Chase Freedom card, which is better than Discover in my opinion. Like Discover, they offer 5% back on rotating categories, but they give 1% on everything else. Discover only gives 1% after you spend $3,000 annually.
With that $3,000 minimum…they really make you spend for your reward.
We have an American Express Business card through Costco. No annual fee and 4% back on gas, 3% back on restaurants and travel, and 1% back on everything else.
I wouldn’t do a card with an annual fee regardless of the cash back it gave. There are plenty of cards that give perks without annual fees.
The rotating categories annoy me only because it’s one more thing to keep track of. The Chase Freedom card (I believe) you have to call and “activate” your savings every three months to earn the cash back. That is annoying to me.
Knowing myself, I would have to put “activate” savings on the calendar and it would require another planning process of what I should “buy” this month.
We’re mostly using a Citi Thank You card at the moment. I’m happy with the rewards. I refuse to pay an annual fee for privelege of using a card, though, so maybe I’m missing out on better rewards.
My biggest reason for using the card, though, is the extra level of protection it offers. We’re currently paying a number of medical bills for my MIL. The billing systems can be very slow in applying payments. If we send a check, I can’t actually be positive that the right person got it. With credit card payments, it’s not just my word that a check was sent and cashed, it’s also my credit card company’s word that a payment was made to the correct place, and if something goes wrong, I can then work with them to cancel the charge.
When my first son was born, we had a pretty hefty bill from the hospital. I cut a check and the hospital cashed, but lost the check and said that I still owed them the money. I was so irate. They were turning me over to a debt collector! Eventually the mess was worked out, but I can see why you are opting for a credit card for payment.
I feel very ambivalent when it comes to credit cards. Using them to advantage requires a level of discipline and savvy that is developed only with hard practice. After a period of prohibition (a bit like you) I use them now but only ones with loads of perks – like reward, insurance etc. And they are paid every month without fail – with a small exception which is my work one where payment depends on when my employer will refund expenses.
Maria,
My budget is really specific, so by the beginning of the year, if I wanted to use a credit card, I could correctly estimate how much I would be spending on the credit card. If the amount of the cash back varied or perk kept rotating, then I would probably not be able to take advantage of all the benefits.
I love my credit card – I get 1% back each year on everything I spend, so I just put everything on my card and pay it off on time every time. This year I got $300 extra just from my credit card rebate!
What did you do with the $300?
I have 6 personal credit cards right now – two Amexs and four Visas. I love them because I get amazing sign-on bonuses, and the continuing rewards aren’t too shabby either. Example: thanks to a British Airways sign-on bonus miles we got roundtrip tickets to Buenos Aires for two, for just $420. We are getting 2 nights free at a $500/night+ hotel thanks to Chase Hyatt and we are getting 2 nights free at a Starwood ($200+/night) thanks to Amex SPG. So for our 9 night honeymoon we’re only paying for 5 nights.
Dang…you know how to work the system! When I traveled heavily on business, I was able to get enough miles to travel to China on business class for next to nothing.
I have been using our card again (yes, just one). We stopped using them when we were getting out of debt. I use it to get the cashback incentive. I have also been using it more like it’s coming out of our checking account, I suppose it is.
Credit cards aren’t evil. I used to think they were, but it was my sending habits that were evil.
I think my biggest beef with credit card is that it masks spending habits. You can pay off the full amount each month, but it does not show you what you are spending day in and day out.
Amazing you haven’t used a credit card in two years! I may need to cut some off. Don’t have a problem with credit as I always pay it off. Just seem a little too cluttered. I have a Discover card (same benefits as the others, but also sucked into their million dollar giveaway), Mastercard, and an Amex one from Costco.
I guess we could just get one and pay it off every month, but then I would have two separate accounts to reconcile…with my excel spreadsheet and then “go over it” with Mr. Super Frugalette…I am not willing to put in the work right now.
Wow, 2 years no credit card use?! IMPRESSIVE!
I spent too much in January and now I regret it. I’m going to put it away for March and get back to normal spending.
S
Did you take advantage of sales….maybe you made some wise purchases?
When I pay off the balance I will only keep my AmEx, it has no fees and you have to pay the balnace every month, you can’t postpone it and just pay the rents so that keeps you for using for stupid things you actually don’t have the money for…
I have two credit cards. One of them is tied to an international mileage programme (which is great), but the other one has no benefits at all. I was inspired to call them a few weeks ago to find out if they offered any cards with benefits and they said no. I now have to decide what I should do – say goodbye or write a letter asking for (demanding nicely) some benefits…