I admit, I love my reward credit cards, and I run everything through them as much as possible.
When I go to some store (like Target), I even buy a pack of $1 gum with my credit cards! So you might be wondering why I love to own credit cards such as the American Express Blue Cash Card and the Chase Freedom cards?
Well basically, it’s because I like the discount that the cards gives me on all of my purchases! Why would I want to pay with cash if it’s cheaper to pay with a credit cards via reward points? It’s kind of ironic if you think about it. I’m getting a discount in the form of reward points, but when I use such reward credit cards, the store that I’m using the credit cards at, pays the credit card companies extra fees. You’d think they would do the opposite and charge less for cash and more money for the credit cards. But they don’t!
Perhaps someday they will, but until that time I’m going to continue to get my discount on items bought at such stores and vendors.
I Love Money Hacks
Another thing I love about credit cards is the potential to discover money hacks to maximize the benefit of using reward credit cards. Often with me and others it’s a game to find a way to maximized the benefit of using the credit cards. In my case, I only pursue legal money hacks!
An example of a common money hack today is when you have a reward credit card, and then guy gift certificates at a grocery store like Giant Eagle. You see in this example you get a higher reward rate because you are using the card at a grocery store, but you are also getting the fuel perks from Giant Eagle to make a purchase there. So basically you are getting a double benefit for what would cost you much more if you were paying cash for the gift certification at Giant Eagle.
If you look around for such deals, they are possible to find! You don’t hear about them much because after a while the loophole becomes know and the store that has such a loophole closed it eventually.
Controlling Credit Cards
The thing about credit cards is that they are just a tool. You much control the tool and not have the tool control you. So that said, if you carry a credit card balance more than a few months, the rewards credit cards lose their advantages and you are better off going for the lowest interest rate credit cards you can find. The reward credit cards carry a slightly higher interest rate than non-reward credit cards.
In my particular case, I don’t carry a balance, so the reward points is all true savings for me.
What do you think? Are you a fan of reward credit cards too? If not, then why, especially if you don’t carry a balance?