Author Topic: CC usage  (Read 32638 times)

aclarridge

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Re: CC usage
« Reply #50 on: December 12, 2013, 07:36:46 AM »
If that were available in Canada, I'd be all over it :)

eyePod

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Re: CC usage
« Reply #51 on: December 24, 2013, 06:23:36 AM »
We have 4 credit cards and pay them off each month.  Remember, if there's fraud, you don't want it on your debit card.  You want it on the credit card.  Guess which happens if they steal your credit card and steal the bank's money?  It gets fixed really quickly!

Thegoblinchief

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Re: CC usage
« Reply #52 on: December 24, 2013, 07:33:09 AM »
We have 4 credit cards and pay them off each month.  Remember, if there's fraud, you don't want it on your debit card.  You want it on the credit card.  Guess which happens if they steal your credit card and steal the bank's money?  It gets fixed really quickly!

I use a debit card for almost everything because I shop at stores like ALDI that offer insanely low prices, partly because they are cash/debit only.

One day I'll get around to getting the Costco AMEX.

Jamesqf

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Re: CC usage
« Reply #53 on: December 24, 2013, 11:12:24 AM »
I only have one credit card... I always thought having more than one was a dangerous and bad thing!

Why?  As long as you can remember to make payments on time, and these days you can automate that.

Plus these days there are lots of cards that'll give you $100 or so for signing up (and spending some amount in the first few months), and 0% interest for a year or so...

kpd905

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Re: CC usage
« Reply #54 on: December 25, 2013, 06:45:50 AM »
Plus these days there are lots of cards that'll give you $100 or so for signing up

Or $400+.

eyePod

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Re: CC usage
« Reply #55 on: December 25, 2013, 10:03:11 AM »
We have 4 credit cards and pay them off each month.  Remember, if there's fraud, you don't want it on your debit card.  You want it on the credit card.  Guess which happens if they steal your credit card and steal the bank's money?  It gets fixed really quickly!

I use a debit card for almost everything because I shop at stores like ALDI that offer insanely low prices, partly because they are cash/debit only.

One day I'll get around to getting the Costco AMEX.

That's really strange.  I'm surprised they don't let you use credit cards.  Maybe it's something with the WIC/food stamp debit cards?  We would use cash in those instances, but it's definitely more of a pain for me to do manage the cash than it is to use the credit card.  As long as it works for you though!

kpd905

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Re: CC usage
« Reply #56 on: December 25, 2013, 02:26:39 PM »
I think Aldi doesn't allow credit cards to avoid the fees they would have to pay for each transaction.  They keep costs to a minimum to keep their prices low, usually having 2-3 people running a store at a time, from what I've seen.

Jess2014

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Re: CC usage
« Reply #57 on: December 29, 2013, 01:34:43 PM »
We also take advantage of “manufactured spending” opportunities each month to rack up more credit card points. For example, I send $1k to my husband each month through Amazon Payments using my credit card as the funding source (no fees) and then he withdraws the money right back into our bank account. That is an easy 12k points per year. You can do the same thing with the Serve AMEX prepaid card. We each have one and fund it with $1k each month with our credit cards. That's another easy 24k points each year between both Serve cards. Just make sure your credit card company doesn’t view it as a cash advance. I use the Chase Sapphire and they view it as a purchase, so there are no cash advance fees.

Hi FreeBy45,

I'm completely new here (to the forum) and working my way through MMM website (I absolutely loveeee it!)

Anyway, re the above (sorry if I sound really naive) exactly how does this work?

Hubby and I have USAA c/card - zero balance - pay in full each month.

Is it (for example):

He transfers 1k (in dollars) to me each month via amazon
I receive the 1k and transfer it back to our joint a/c (it almost sounds like money laundering - don't laugh!!)

And I can do the same to him?

And we can do this each month?

Wouldn't/doesn't the bank or Amazon question this if you do it every month?

Otherwise, it seems an incredible way to rack up points for travel say.

Many thanks in advance for any guidance and light you can share with me, much appreciated,

Jess :)

nawhite

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Re: CC usage
« Reply #58 on: December 31, 2013, 01:41:14 PM »
Jess2014, you're exactly right in how it works, and yes, it is essentially money laundering. It is just the current scheme of the people who try to maximize points. The scheme used to be, buy 10k in Dollar coins from the US Mint on your credit card, take delivery, deposit the coins at your bank and use the deposit to pay the credit card bill 30-45 days later. The US Mint caught on and eventually closed the loophole. The amazon payments thing is just the current incarnation of this scheme to get as many points as you can for free.

Eventually, if people keep on doing this, Amazon will realize its stupid to take a $20 hit in merchant fees on every $1000 they allow transferred for free and will cancel the service and all of those points people will have ruined a good thing because they were greedy.

In case you didn't catch how I feel about this, Use Amazon payments to pay your rent or person to person transactions because that is what is was made for. Don't use it as a credit card points mill because you'll ruin it for the rest of us.

Dicey

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Re: CC usage
« Reply #59 on: December 31, 2013, 02:07:54 PM »
You can do better.  Lots of rewards cards have been offering 0% interest for a year or more.
Oh, but a true Mustachian cares not for interest, as they pay off their balance in full each month!

This year, in the bustle of emptying and selling three houses, moving to temporary quarters and finally moving into our new house, I missed an AMEX payment (100% my fault, not complaining.) They sent me a letter telling me they were raising my interest to over 22%. I laughed out loud, because the interest rate Does.Not.Matter. I'd tell them to shove their card, but it's the free Costco one, which I use all the time. Our rebate will be about 1k this year, so I think I can handle the late fee.

PS-Yes I know I could automate the payment, but I do not trust them. I want to review the bill every month both on line and on paper. Particularly now, as I used it not once but three freaking times at Target during the period they were hacked.

Jamesqf

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Re: CC usage
« Reply #60 on: December 31, 2013, 03:00:20 PM »
You can do better.  Lots of rewards cards have been offering 0% interest for a year or more.
Oh, but a true Mustachian cares not for interest, as they pay off their balance in full each month!

Not so, because the money I'm borrowing from the credit card companies at 0% is sitting in my mutual fund account, earning something over 25% this year. 

Of course the outstanding balances will be paid off before any interest is due.  (Or transferred, if I find another card that offers no-fee transfers and 0% interest to the end of 2015 :-))

Jess2014

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Re: CC usage
« Reply #61 on: January 01, 2014, 12:01:10 PM »
Hi nawhite,

Thanks for the clarification. 

Yes, it does sound too good to be true and I can't imagine Amazon won't catch on at some point.  All these points n' cash backs do sound lovely but hubby and I are a bit 'old fashioned' I guess and will stick to USAA c/card and just use that.  Fewer points but we know where we stand and no jumping around n' stuff.  To those who can milk the system I say fill your boots, probably not for us in the end though.  Thanks again :)

YK-Phil

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Re: CC usage
« Reply #62 on: January 01, 2014, 09:34:07 PM »
So you sign up, use it for the minimum required time/amount to get the reward then cancel? Doesn't it hurt your credit score?

I'll jump in since I have signed up for 13 cards this year.  For any card with a fee, I plan to keep them for 10-11 months, then call and ask to have the fee waived.  Sometimes they'll offer you enough points to offset the fee.  If they don't, then I'll cancel or downgrade to a no fee card.

Regarding the credit score:  I signed up for an Amex card in March that gave me my official FICO score at 760.  Since then, I signed up for 13 cards, one auto loan and another hard pull from an apartment search.  My official FICO score 2 weeks ago was 787.  760 is generally thought of as the score that will get you the best rates on a mortgage or other loan.

Between my GF and I signing up for cards this year, we took two flights to Miami, two flights to Portland, two to Wisconsin.  I think we had 4 or 5 free nights in hotels and a couple hundred dollars in statement credits.

I am currently planning a trip to Maui that will use up most of our remaining points.  But free flights to Maui and free 4-5 star hotels for 8 nights will be worth it.

People interested in retiring early seem to be organized and well disciplined, both qualities that can make you successful at the credit card churning hobby.

I just got my new Amex card which came with a welcome bonus of 15,000 Aeroplan miles (if you spend a minimum of $500 in the first three months) and no fee for the first year. I immediately booked my next return flight to Yellowknife for $525 and got the 15,000 points which will buy my next roundtrip for under $100 (tax and fees), giving me about $400 of real instant savings since I have to fly there and back once a month at my own cost.

daverobev

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Re: CC usage
« Reply #63 on: January 02, 2014, 11:00:49 AM »
When it comes to credit score/grade, is it better to have 1 or more than one credit card? I have one that is 11 years old, and that is it.

From what I've read, better yes but not essential. The only downer in your case is that, right now, if you opened up 2-3 new ones, the 'average age of accounts' would nosedive, which would pull your score down a bit. Unlikely to be the end of the world. But having more credit is (within limits) seen as good (you don't want to have 'so much' unused credit and then be applying for tons more - the card companies might view it as 'he's going to go on a crazy spree and not be able to pay anything back'). I think the best generic advice is a) to get the card with the best returns for you, and b) to have one each of Visa, MasterCard, and Amex (no idea how Diners and Discover work).

daverobev

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Re: CC usage
« Reply #64 on: January 03, 2014, 12:09:12 PM »
daverobev: If my goal is a better credit score in 1 year, would it make sense to get another brand of card right now? I have a card and got the maximum amount of credit that my bank will allow for my income. Would getting an additional card right now be viewed as getting more than I can afford? Would the other companies give me the amount of my next increase, or the around same amount that my bank has already given me?

If you feel comfortable, post your income, expenses, credit limit, borrowing, and your current score if you know it.

I'm not an expert. The scoring companies generate a closed-formula (ie, people outside don't know exactly how the score is calculated; and there are a whole raft of different scores for different purposes - different weightings for different factors for a mortgage vs car loan vs credit card...).

But the basic factors are how much you owe vs how much you earn, how much your cost of housing is as compared to your income, how many lates or overdue payments, how many 'hard hits' and so on. Obviously paying on time is a huge plus, not having too much credit available helps, etc, etc.

Banks are often more conservative than other places. If you want to improve for a year's time then yeah, probably no harm in applying for a couple of new ones with good bonuses, using them and paying them off properly. If you're stretched in any way then no, focus on paying off debt - the hard hits won't look good and you might get denied... Impossible to say without knowing more (and even then we can probably only give hints.. again, I'm not an expert, but there may be people who are!).

daverobev

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Re: CC usage
« Reply #65 on: January 03, 2014, 03:41:52 PM »
Income 55k, 1 credit card with 8k and 0 balance. Debt free in a couple months. Current credit grade B+. expenses about $3500, higher than normal because I'm currently using the military's savings deposit program to save money. Think I should get a couple credit cards, or wait?

If you aren't applying for a mortgage in the next 6 months, I'd say go for it. $8k isn't much total available credit for that salary. Figure out one extra one, say, that has some good bonuses and works as well or better for you - eg one with high cashback for gas & groceries, or good travel perks.

I did read on one points blog about an 'app-o-rama' but that might be a bit scary - applying for ~6 cards to get a bootload of bonuses all at once. I'd find the best, fee free for the two major networks you don't have, and go for them.

Note: it's good to have stuff NOT with your bank. Your bank can, in the event of issues, just take money from your checking account or savings to pay liabilities on a credit card. That's part of the application agreement. So if you have a BoA checking, you might choose to not have a BoA credit card. I personally don't worry about that kind of thing but it is a thing to think about. I'm pretty sure that'd be true in the US.

kpd905

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Re: CC usage
« Reply #66 on: January 04, 2014, 05:06:18 PM »
My total amount of credit is about 90% of my salary.  You can definitely get another card.

GodlessCommie

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Re: CC usage
« Reply #67 on: January 06, 2014, 11:28:43 AM »
Priceline Rewards Visa pays 2% on everything. You can apply rewards to your next statement - much more flexible than miles or giftcards. If you need an Amex, there is a Fidelity branded one that also pays 2% which can be transferred into any Fidelity investment account.

We used Amex Blue Cash Preferred last year... the catch for us was that not everything that we thought would be counted as grocery stores did count as such. Plus we do a good deal of grocery shopping in Costco, and don't spend a lot on gas. So our effective rate, including the fee, was 1.75%. Not terrible, but a flat 2% card would be better.

A point of caution on Points Guy and other miles bloggers... they are pushing cards that pay good referral fees, and mostly ignore cards that don't. That covers cards with lucrative sign up bonuses pretty well, but not good spending cards.

madage

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Re: CC usage
« Reply #68 on: January 06, 2014, 11:37:03 AM »
Priceline Rewards Visa pays 2% on everything. You can apply rewards to your next statement - much more flexible than miles or giftcards.

That card is not available to new applicants.

Quote
A point of caution on Points Guy and other miles bloggers... they are pushing cards that pay good referral fees, and mostly ignore cards that don't. That covers cards with lucrative sign up bonuses pretty well, but not good spending cards.

To everything churn, churn, churn.

GodlessCommie

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Re: CC usage
« Reply #69 on: January 06, 2014, 04:18:43 PM »
That card is not available to new applicants.
Quote

That's too bad... Guess I'll stop promoting it.

HokieInPa

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Re: CC usage
« Reply #70 on: January 06, 2014, 07:16:34 PM »
The Capital One Venture card has 2% for all purchases as long as the points are redeemed for travel of any sort (airfare, hotel, car rental, etc). It's not cash, but still very nice. We use it when we don't have a better % from another card. So we earn 2-6% depending on which card we use

Ebenezer

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Re: CC usage
« Reply #71 on: January 07, 2014, 07:33:18 AM »
I did hear that in the UK at least, if you call up the mortgage company and plead "poverty", they will let you pay the mortgage with your credit card "just this once". You can apparently repeat this stunt ad infinitum, racking up the points/miles/etc as you go. Never had the nerve to try this myself, mind.

ichangedmyname

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Re: CC usage
« Reply #72 on: January 07, 2014, 08:27:03 AM »
I think the regular Chase Sapphire and American Express Blue Cash look nice. No fee, and rewards. Any others along that line?
I wanted to get the AMEX but recently with my slew of AMEX gift cards, I found out the harsh truths that a lot of the places I buy things from will not accept AMEX.

hybrid

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Re: CC usage
« Reply #73 on: January 07, 2014, 09:16:27 AM »
So you sign up, use it for the minimum required time/amount to get the reward then cancel? Doesn't it hurt your credit score?

I'll jump in since I have signed up for 13 cards this year.  For any card with a fee, I plan to keep them for 10-11 months, then call and ask to have the fee waived.  Sometimes they'll offer you enough points to offset the fee.  If they don't, then I'll cancel or downgrade to a no fee card.

Regarding the credit score:  I signed up for an Amex card in March that gave me my official FICO score at 760.  Since then, I signed up for 13 cards, one auto loan and another hard pull from an apartment search.  My official FICO score 2 weeks ago was 787.  760 is generally thought of as the score that will get you the best rates on a mortgage or other loan.

Between my GF and I signing up for cards this year, we took two flights to Miami, two flights to Portland, two to Wisconsin.  I think we had 4 or 5 free nights in hotels and a couple hundred dollars in statement credits.

I am currently planning a trip to Maui that will use up most of our remaining points.  But free flights to Maui and free 4-5 star hotels for 8 nights will be worth it.

People interested in retiring early seem to be organized and well disciplined, both qualities that can make you successful at the credit card churning hobby.

I'm another Costco Amex full balance payer but I am putting this optimization strategy on my 2014 bucket list to explore.  I took care of all the lowest Mustachian fruit in 2013 and now I am concentrating on the fine tuning.  This seems like a fine place to start.  Thanks for the tips.

YK-Phil

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Re: CC usage
« Reply #74 on: January 07, 2014, 04:13:13 PM »
In Canada, TD Bank now offers an Aeroplan Visa Infinite Card, for $120 annual fee. It comes with a welcome Bonus of 15,000 Aeroplan Miles upon first purchase and for a limited time, a 2-for-1 flight reward. Since I must pay for my flights once a month to go to work and back (average $500 roundtrip), this card makes sense for me at least for the first year, even with the annual fee and the cost for two flights rewards (which are not entirely free when you consider you must pay for fees and airport taxes, etc.). I'll definitely get it, and cancel it in 11 months before the annual renewal fee is due.

kpd905

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Re: CC usage
« Reply #75 on: January 07, 2014, 04:52:23 PM »
I think the regular Chase Sapphire and American Express Blue Cash look nice. No fee, and rewards. Any others along that line?

I think you'd be better off getting the Chase Sapphire Preferred, taking the $450 sign up bonus, and then downgrade to the regular Sapphire card before your annual fee is due.

nawhite

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Re: CC usage
« Reply #76 on: January 08, 2014, 11:18:36 AM »
I have a crazy plan for points that I heard about on here but I can't find the post.

So I'm going for the Southwest Companion Pass (spouse always can fly with you for free). I need 110k points in one year. I've signed up for one card that gets me 50k signup points and my spouse signed up for a card that gets her 25k signup points. I can get one point per $1 of balance transfer up to 15k in the first 90 days with a 3% fee. Southwest points are worth 1.6 cents per point or 3.2 cents per point if I'm using the Companion Pass (2 flights for the price of 1). Even if we didn't do this plan, my wife and I would fly Southwest for at least 1 round trip flight and then fly one other round trip for a vacation we have planned which may or may not be via Southwest (we live away from both families). Total annual cost is usually around $2000 on flights for us. So here is where the crazy comes in.

Given that my wife and I would spend at least $2000 on flights anyway, and we can buy points for 3 cents that will be worth 3.2 cents after we get the companion pass, we are planning on maxing out our balance transfers in the first 90 days for the points. Seeing as we don't keep a balance on other cards, this requires creative thinking. The plan is to get a balance transfer to another credit card (Barclay card), then have the Barclay card say "um, you way overpaid us for this month's bill, here is the difference." Then I take the check for the difference and use that to pay back the Southwest card.

So if everything goes correctly, we will have spent $900 in balance transfer fees on 30k in points, we'll have 75k in points from the signup bonuses leaving us 5k points shy. $40 flower bouquets are worth 1000 points right now, so I buy flowers for my mom's birthday and then mothers and grandmothers get flowers for mother's day, leaving us with 110k Southwest points.

Total costs $900 in balance transfer fees, $200 in annual fees, $200 in flowers = $1300

Received: 110k in points (worth $1760 alone or $3520 with the companion pass) and a companion pass through the end of 2015.

Fingers crossed.

madage

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Re: CC usage
« Reply #77 on: January 08, 2014, 12:25:41 PM »
I have a crazy plan for points that I heard about on here but I can't find the post.

So I'm going for the Southwest Companion Pass (spouse always can fly with you for free). I need 110k points in one year. I've signed up for one card that gets me 50k signup points and my spouse signed up for a card that gets her 25k signup points. I can get one point per $1 of balance transfer up to 15k in the first 90 days with a 3% fee. Southwest points are worth 1.6 cents per point or 3.2 cents per point if I'm using the Companion Pass (2 flights for the price of 1). Even if we didn't do this plan, my wife and I would fly Southwest for at least 1 round trip flight and then fly one other round trip for a vacation we have planned which may or may not be via Southwest (we live away from both families). Total annual cost is usually around $2000 on flights for us. So here is where the crazy comes in.

Given that my wife and I would spend at least $2000 on flights anyway, and we can buy points for 3 cents that will be worth 3.2 cents after we get the companion pass, we are planning on maxing out our balance transfers in the first 90 days for the points. Seeing as we don't keep a balance on other cards, this requires creative thinking. The plan is to get a balance transfer to another credit card (Barclay card), then have the Barclay card say "um, you way overpaid us for this month's bill, here is the difference." Then I take the check for the difference and use that to pay back the Southwest card.

So if everything goes correctly, we will have spent $900 in balance transfer fees on 30k in points, we'll have 75k in points from the signup bonuses leaving us 5k points shy. $40 flower bouquets are worth 1000 points right now, so I buy flowers for my mom's birthday and then mothers and grandmothers get flowers for mother's day, leaving us with 110k Southwest points.

Total costs $900 in balance transfer fees, $200 in annual fees, $200 in flowers = $1300

Received: 110k in points (worth $1760 alone or $3520 with the companion pass) and a companion pass through the end of 2015.

Fingers crossed.

I think you're better off getting the 50,000 point business version in your name. Then you only need to "earn" an additional 10k points for companion pass, which you could theoretically do with the balance transfer you propose (just make sure those miles "count" towards companion pass). I don't understand how 25,000 points in your wife's name benefits you here, because those points are in her RR account and they don't count towards companion pass if she transfers them to you.

eyePod

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Re: CC usage
« Reply #78 on: January 08, 2014, 12:59:40 PM »
I have a crazy plan for points that I heard about on here but I can't find the post.

So I'm going for the Southwest Companion Pass (spouse always can fly with you for free). I need 110k points in one year. I've signed up for one card that gets me 50k signup points and my spouse signed up for a card that gets her 25k signup points. I can get one point per $1 of balance transfer up to 15k in the first 90 days with a 3% fee. Southwest points are worth 1.6 cents per point or 3.2 cents per point if I'm using the Companion Pass (2 flights for the price of 1). Even if we didn't do this plan, my wife and I would fly Southwest for at least 1 round trip flight and then fly one other round trip for a vacation we have planned which may or may not be via Southwest (we live away from both families). Total annual cost is usually around $2000 on flights for us. So here is where the crazy comes in.

Given that my wife and I would spend at least $2000 on flights anyway, and we can buy points for 3 cents that will be worth 3.2 cents after we get the companion pass, we are planning on maxing out our balance transfers in the first 90 days for the points. Seeing as we don't keep a balance on other cards, this requires creative thinking. The plan is to get a balance transfer to another credit card (Barclay card), then have the Barclay card say "um, you way overpaid us for this month's bill, here is the difference." Then I take the check for the difference and use that to pay back the Southwest card.

So if everything goes correctly, we will have spent $900 in balance transfer fees on 30k in points, we'll have 75k in points from the signup bonuses leaving us 5k points shy. $40 flower bouquets are worth 1000 points right now, so I buy flowers for my mom's birthday and then mothers and grandmothers get flowers for mother's day, leaving us with 110k Southwest points.

Total costs $900 in balance transfer fees, $200 in annual fees, $200 in flowers = $1300

Received: 110k in points (worth $1760 alone or $3520 with the companion pass) and a companion pass through the end of 2015.

Fingers crossed.

I'm pretty sure that the barclays credit card company won't give you a check for the difference.  Instead, they'll just keep your interest free loan.

thepokercab

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Re: CC usage
« Reply #79 on: January 08, 2014, 01:11:50 PM »
Quote
I think the regular Chase Sapphire and American Express Blue Cash look nice. No fee, and rewards. Any others along that line?

This is basically what i've done- although I got the Blue Cash Preferred-  it has a $75 annual fee, but i got $150 at sign up, and you can't beat its 6% back on groceries.  Then for most other purchases- i use the Chase Sapphire.  Working on getting to my first 3K in spending so I can get my 40,000 point bonus. 

So AMEX for groceries, Sapphire for pretty much everything else.   

Rob

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Re: CC usage
« Reply #80 on: March 30, 2014, 11:54:12 AM »
Quick question about 0% APR. With my new Amex Blue Cash Preferred, I have "0.00% introductory APR through your billing period that ends in June, 2015." So does that allow me to make the only the minimum payment until my July 2015 payment and carry the rest of the debt as a balance with no interest? How will this impact my credit score? Will the balance I keep be included in my credit utilization calculation?  I would like to be able to use that money and earn interest over the next year if it won't impact my credit score very much.

daverobev

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Re: CC usage
« Reply #81 on: March 30, 2014, 12:37:30 PM »
Quick question about 0% APR. With my new Amex Blue Cash Preferred, I have "0.00% introductory APR through your billing period that ends in June, 2015." So does that allow me to make the only the minimum payment until my July 2015 payment and carry the rest of the debt as a balance with no interest? How will this impact my credit score? Will the balance I keep be included in my credit utilization calculation?  I would like to be able to use that money and earn interest over the next year if it won't impact my credit score very much.

Yes; depends on your other credit use; yes.

If you've got $30k total credit and carry $5k on this card ($0 or not much on others) the impact will likely be small. If you have $30k total and carry $20k on this card, the impact will be much greater.

Mortgage Free Mike

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Re: CC usage
« Reply #82 on: March 30, 2014, 12:43:43 PM »
Winning strategy for me. In 2011, I earned nearly $3,000 in credit card rewards. It got me featured on MMM for the first time. As long as you're not using the cards for mindless spending, it's a great way to show the banks who is boss!

kpd905

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Re: CC usage
« Reply #83 on: March 30, 2014, 05:06:19 PM »
Winning strategy for me. In 2011, I earned nearly $3,000 in credit card rewards. It got me featured on MMM for the first time. As long as you're not using the cards for mindless spending, it's a great way to show the banks who is boss!

Good stuff.  I redeemed $5000 in 2013 and have redeemed about $2000 in 2014 so far.  It's a fun game.

 

Wow, a phone plan for fifteen bucks!