Credit Cards - What is the best? Looking to get some rewards without a headache..

[Figit090]

I'm looking to build my credit and hopefully earn rewards through one of the many available credit card companies. It would be one of my first cards so I figure I'd research it a bit before delving into a company that isn't good to deal with. I got a Target card and that proved to be a bit of a nuisance, but I'll admit my circumstances were rather unique.

Anyway,
I have discipline and likely would only use it to make larger purchases, unless I would use it to buy gas providing there are incentives.

My friend tells me that he and his wife use credit cards on lots of purchases because they get rewards, like free $100 gift cards to big-name restaurants or sports stores, and that sounds a lot better than nothing. Plus, I should probably build my credit since I'm only starting this sort of thing.

I do realize I can NEVER be late on a payment and I don't intend to use a card without having that amount and then some in the bank, ready to pay off the bill at my earliest convenience.
Also, can you pay them off immediately, online? Do you have to wait for a month or so for a statement? I know you can have automatic things done with checking accounts but I'd like to do it manually at first, I think.

So, what do you use and why? What DON'T you use and why?


I'm about to buy new tires and a new computer so I figure I'd look at starting my credit out on those purchases (~$2-3k ...probably), maybe get rewards or cash back on that, or in the future. Costco/American Express will give %5 on gas, too.

 

[suprarx7nut]

For simplicity, I use a US Bank VISA rewards. I get 1% back on absolutely everything. I use my card ~98% of the time. The other 2 percent being cash and paypal. My banking is done through US Bank so it just makes everything easier that way.

You can pay your card balance off in any increment, whenever you want. I try to pay mine off before the billing cycle even closes, but either way I pay it off every month. I tend to use my pay days as a scheduled time to check on my account and make sure I'm in good shape.

I also have the card set up so that every time i use it, $1 gets transferred from my regular checking into my savings account.

There are other cards out there that offer much better rewards, but often times the reward periods aren't permanent, whether it be 1 year, 1 quarter, 1 month, or even 5 years. My Shell Gasoline card paid back 5% on gas until recent legislature (thank you Dodd, you can go suck on my nuts. Thanks to your legislature I lose $10 a month. Asshole...) and now they dont offer anything so I canceled that and I only use my US Bank Visa.

I'd start out looking at your bank and see if they offer a simple 1% back, no annual fee credit card. I think most places offer one. My online banking is super easy.

Good luck!

 

[Mr Bojangles]

^+1. Go to your bank or better yet a credit union and get a card through them to start.

 

[te72]

Something to consider, be VERY careful with credit cards. These bonuses likely come from the fact that many retailers have to pay the credit card company for accepting their card. They wouldn't just offer something for nothing, or they wouldn't be in business.

See that thread about "living with a Supra" in my signature? Take a look at that, you'll see a couple examples of what NOT to do with a credit card. Shit, I'm *still* paying for things that I bought years ago for an engine that's now scrap...

 

[flight doc89]

First piece of advice: if you are starting out, limit yourself to 1 (ONE)(uno) card. Dont get sucked into the whole "oh, I use my texaco card for gas and my chase visa for food and my BoA card for everything else cuz that gets me the best percentages". Just forget all that, too much to keep track of. You will quickly find interest payments overcome your cash back.

Secondly: Go to your bank, and ask for a new checkbook register and either get a checkbook or a full-size wallet with a register pocket. Keep the credit card with this AT ALL TIMES. When you make a purchase, write it down. And so you reply: "Why, Curtis? All I have to do is look at my online account!?! I can even get it right on my phone..." Here is the problem with that: you may make a purchase with the card, and that card is preauthorized when they swipe it. However, in many cases, that transaction will not show up on your account until they process the final transaction through the credit company. I have had card transactions (for significant amounts of money) take WEEKS to post. You dont want that to sneak up on you.

This is what you want \/

Next piece of advice: we VERY CAREFUL about "0% (Fuckin ZERO PERCENT!ZomG) interest for {insert #} months!" If you have a big purchase, have a reliable income, and can reliably budget the money out, these can be handy (i have taken advantage of these several times and never paid a penny in interest). If you want to do this, here is what you must do: conduct that ONE and ONLY transaction, then cut the card into pieces and never use it again.
Why is that so important? Every single credit card (i have never found any that dont do this) has a clause in the contract that says something like "Payments will be applied to balances with lower interest rates before being applied to balances with greater interest rates"
So, you take your new credit card (with promotional 0% apr for 12 months!) to sears and buy a new kickass Zero-radius (fuckin ZERO!0o) lawn mower for $4000. You look at the cashier, grin, flash your new credit card, and say to yourself "12 months? hell, I'll pay dat bitch off in 10! $400 a month, baby, and no interest!".
You go home, start mowing your lawn, your mom's lawn, hell your fuckin' neighbors' lawns. Soon, every blade of grass for 6 miles in any direction has been mowed down. The blades of grass in the next township whisper your name in fear. Meanwhile, you use that (OmgAwesum) card to put gas in your mower and buy some new blades, new oil, new belt, and over the next month you put an extra $200 on that card.
But hey, no biggie, you made that much money from your mom because you convinced her that her grass needs to be cut at least every 48 hours if she wants to be on Good Housekeeping. So you took that money and paid $600 that month instead of $400, so you are back on track, right?
WRONG! That $600 was applied to the low apr (zOmG ZERO INTEREST) promotional balance, NOT the balance you just racked up (29.99% APR MuthaFucka). Now, you are royally screwed...bent over the banker's table...no lube...need I go on? You now have to pay off the ENTIRE 0% APR balance (don't worry, after this month it'll only be $3200 left) before you can make any payment toward the new *29.99%* APR balance, which will of course continue to accrue while you are busy paying off the promo balance.

Bet you wish you hadn't used that card now, muthafucka

 

[suprarx7nut]

Haha, While I enjoyed that narrative I've certainly never experienced that sort of credit card experience. My only promotional card was Best Buy and the zero interest is simple. It pays off minimum balances on each purchase, then applies payments to whatever promo period (interest free) ends first. It automatically tries to protect you from interest. Certainly no "Evil" mysterious application of payments. I had nearly a dozen purchases on it at a time and it was very easy to track where money was going to be applied. Used it to buy some TV's (yes, plural) for some friends and had a free loan. I kept that large balance on there for a long time and since it was the latest due date all payments got applied to other purchases first.

At any rate, yes you do need to be careful with a credit card. It's still money. No different than spending your own cash. The interest rates are HORRIBLE and you should NEVER buy anything you can't pay off right away. I use my CC for everything and it's simply because it's more convenient than anything else.

 

[flight doc89]

Haha, While I enjoyed that narrative I've certainly never experienced that sort of credit card experience. My only promotional card was Best Buy and the zero interest is simple. It pays off minimum balances on each purchase, then applies payments to whatever promo period (interest free) ends first. It automatically tries to protect you from interest. Certainly no "Evil" mysterious application of payments. I had nearly a dozen purchases on it at a time and it was very easy to track where money was going to be applied. Used it to buy some TV's (yes, plural) for some friends and had a free loan. I kept that large balance on there for a long time and since it was the latest due date all payments got applied to other purchases first.

At any rate, yes you do need to be careful with a credit card. It's still money. No different than spending your own cash. The interest rates are HORRIBLE and you should NEVER buy anything you can't pay off right away. I use my CC for everything and it's simply because it's more convenient than anything else.

+1 for the Best Buy card, that is actually a really nice contract.
I only use two credit cards these days: my chevron/texaco card and my lowes card. I do most purchases on my debit card. I put all fuel and any small purchases (lunch, soda, etc) on the chevron card. I put anything from lowes on the lowes card because I can either get 5% off or 6months interest free (i have only used the interest free period twice, otherwise i take the 5%)(that 5% can actually stack on top of some other discounts as long as the cashier isn't smart enough to catch it).

I also have a target card that i use to get a percentage off (5% i think), but I NEVER carry a balance on it. I literally make the purchase, then walk straight to the customer service counter and pay it off, lol

 

[te72]

I guess I'm a bit old school in my application of credit then, I have ONE card, from my credit union. Interest rate really isn't TERRIBLE, even though it went from ~8% to something like ~12-14% a couple years back, but no bonuses, promos, etc... I've since paid it off, and haven't used it since. Every once in a while, I get a letter saying, "you have a $4200 limit that's completely available...", but I shred them. The ONLY thing I'm even remotely considering putting on there is the wheels and tires for the widebody. I've budgeted ~$3500-3700 for this, but the ONLY way I'll even do that is if I get the car "done" (wheels/tires being the LAST thing on the list) right in time to start driving the car. If not, it can wait in the garage for 6 more months while I save up the cash to do it in one cash purchase.

Comes down to, if you're smart, and WELL DISCIPLINED, credit isn't a bad thing. The creditors are betting on you not being either of those things to make their money though.

 

[suprarx7nut]

Comes down to, if you're smart, and WELL DISCIPLINED, credit isn't a bad thing. The creditors are betting on you not being either of those things to make their money though.

This is really the main point. You can use credit to your advantage or you can shove your hand in the candy jar and disregard the consequences. If you're disciplined, you can receive rewards for using credit which are paid for by those who are not generally disciplined.

One good piece of advice I think came from SC is "Don't finance your fun". Regardless of its origin, I think that statement is a very good one to live by.

 

[te72]

One good piece of advice I think came from SC is "Don't finance your fun". Regardless of its origin, I think that statement is a very good one to live by.

Says that as succinctly as possible, I couldn't have done better myself.

 

[Supracentral]

I covered a lot of this stuff in this thread back in 2008:

http://www.supramania.com/forums/sh...ow-to-keep-from-fucking-yourself-finanically)

 

[3p141592654]

Chase have been offering a nice deal of $200 cash back after 3 months if you make more than $500 in purchases. Not sure if that deal is still offered, but it was around in February.

Yup, looks like its still around. For first time card user this is a good deal IMHO.

http://www.dailymarkets.com/creditcards/chase-freedom-card/

https://applynowdc1.chase.com/FlexA...SxaiJhd.Unvtcpi_orD2g&pvid=163358FOF500127237

 

[te72]

3p, maybe it's the part of me that worked for Discover waaaaaay back in high school, but it makes me nervous to think that they're giving back as much as 2/5ths of what you've spent with that card. Again, probably not a big deal if you're smart, but again, nothing is free, that program HAS to be costing someone some serious money in the long run.

 

[3p141592654]

Yeah, I agree its a big investment for them, but it is also very strategic, focused, and ultimately a drop in the bucket compared to what they expect to get out of a typical new customer over the long haul. In a mature market like the US, getting a new customer is not easy.

For them its a marketing expense that while pricey in the short term, provides a strong incentive to sign up if you are a potential new customer which an equally expensive radio or print ad campaign doesn't do, it trains the new customer to make their card the one you choose first, and it leaves a warm fuzzy when you get the $200 rebate (which you will have to declare as income on your income tax by the way).

Two years ago Bank of the West was offering a free Itouch to anyone who signed up for a checking account with debit card and made $500 in purchases. Same deal really.

 

[te72]

Hmm, you do make some good points there. I guess I'm just not their ideal customer, but they'll likely make their money back from people who are I suspect.

 

[Figit090]

BIG quote-filled reply, I think I replied to most of your posts everyone:icon_bigg, sorry I've been away and couldn't keep posting daily.:aigo:

For simplicity, I use a US Bank VISA rewards. I get 1% back on absolutely everything. I use my card ~98% of the time. The other 2 percent being cash and paypal. My banking is done through US Bank so it just makes everything easier that way.
...
I'd start out looking at your bank and see if they offer a simple 1% back, no annual fee credit card. I think most places offer one. My online banking is super easy.

Good luck!

^+1. Go to your bank or better yet a credit union and get a card through them to start.

Thanks, guys! I'll look more at my bank, and possibly opening an account with another bank (guh...perhaps incentives will pay off?) I appreciate the feedback, though. I'm with BofA so I know there's a card with benefits, so I'll check.

Something to consider, be VERY careful with credit cards. These bonuses likely come from the fact that many retailers have to pay the credit card company for accepting their card. They wouldn't just offer something for nothing, or they wouldn't be in business.

See that thread about "living with a Supra" in my signature? Take a look at that, you'll see a couple examples of what NOT to do with a credit card. Shit, I'm *still* paying for things that I bought years ago for an engine that's now scrap...

True, I'll check with what I want to purchase, and make sure it works with my bank/credit card choice. The Chase offer (if legit) of $200 after 3/mo and $500 spent is a good offer, granted I can easily pay off that balance and taxes/trouble doesn't make it not worth it. Perhaps it's a great deal though, given ever offer is targeted to get people hooked (i'm guessing I will be a seldom user of cards and always have the cash to pay them off instantly or at the next billing cycle. Sorry you're still paying for stuff! I'm out to take advantage of a company taking advantage of (millions of) ignorant, and often financially strapped, people. It's not free and carries risk, I will simply place that as my payment for getting cash back, a tad bit of work and record keeping.

First piece of advice: if you are starting out, limit yourself to 1 (ONE)(uno) card. Dont get sucked into the whole "oh, I use my texaco card for gas and my chase visa for food and my BoA card for everything else cuz that gets me the best percentages". Just forget all that, too much to keep track of. You will quickly find interest payments overcome your cash back.
...

First tip response: What if I plan (will) pay off the card with cash I set aside, only using the card in order to reap the benefits? I don't intend to spend money I do not have, and I hardly want to use different cards for different things. Interest also becomes a mute point, assuming I don't royally fuck up and forget to pay a debt, with my cash that is set aside specifically for doing so.

Second tip response: I have a register for my debit card, and use it now. Thanks so much for your tip as I just discovered a charge from amazon that showed up and then COMPLETELY DISAPPEARED after a few days, bumping my acct. back up the 13 odd dollars. THEN it took it back out at a random time when the payment cleared or something. Very tricky, and if I hadn't been keeping books, I wouldn't have noticed (and overdrawn my account, for the second time this year, due to recordkeeping goofs I won't make again).

Third tip response: THAT is what I plan to do, make big purchases by setting that same money aside, possibly setting "planned" money aside if my jobs were more regular (but for now that is not something I will do). I will keep the card under wraps and only use it when I want rewards, or that initial purchase (computer/tires/other expensive crap).
Thanks for the tips, and the one about the interest applying weird to certain balances rather than the whole balance, I'm still learning how credit cards work, exactly. If I ever plan to use the interest rate (dunno why I would...) I will make sure to check as to which debts the interest/payments apply, respectively. I would hope it would make logical sense to pay off debts that incur the most interest first, but given the whole point of a credit company's business tactics I would not be surprised if it were the other way around.

I also have a target card that i use to get a percentage off (5% i think), but I NEVER carry a balance on it. I literally make the purchase, then walk straight to the customer service counter and pay it off, lol

Yeah I have one too, plus my employee discount = 15%. Not much but it helps on bigger stuff. It's a pain if you want to return something though (refund check in the mail for credit card will tie up those funds for a few weeks, I just experienced this). Funny thing happened the other day, too, when paying off a purchase to the credit card, the register popped and said to give me BACK 20 or so of that payment! we cancelled the transaction but I *almost* got some free money! lol. I won't say details that could re-create this encase it's a company-wide glitch...it could potentially be abused/get me fired. lol. anyway..

This is really the main point. You can use credit to your advantage or you can shove your hand in the candy jar and disregard the consequences. If you're disciplined, you can receive rewards for using credit which are paid for by those who are not generally disciplined.

One good piece of advice I think came from SC is "Don't finance your fun". Regardless of its origin, I think that statement is a very good one to live by.

This. Sounds like a prime idea, and sound advice.

I covered a lot of this stuff in this thread back in 2008:

http://www.supramania.com/forums/sh...ow-to-keep-from-fucking-yourself-finanically)

Thanks, Mike. I'll read through that next.

Chase have been offering a nice deal of $200 cash back after 3 months if you make more than $500 in purchases. Not sure if that deal is still offered, but it was around in February.

Yup, looks like its still around. For first time card user this is a good deal IMHO.

http://www.dailymarkets.com/creditcards/chase-freedom-card/

https://applynowdc1.chase.com/FlexA...SxaiJhd.Unvtcpi_orD2g&pvid=163358FOF500127237

Those links, how legit are they? I ask as chase offers a similar package on their main site but it's only $100, and there is a phone number on the page next to the little lock and "SECURE APPLICATION". Those are the only main differences, but I still ask to avoid entering any information that might be more at risk for being stolen or used in a bad way... It looks like kickbacks are given to dailymarkets.com for referral to chase.com, but I still wonder how to tell it's not a scam site? If you have any knowledge on the site, let me know, please. =)

3p, maybe it's the part of me that worked for Discover waaaaaay back in high school, but it makes me nervous to think that they're giving back as much as 2/5ths of what you've spent with that card. Again, probably not a big deal if you're smart, but again, nothing is free, that program HAS to be costing someone some serious money in the long run.

As 3p said later on, it seems to me like this incentive could really get some "OH MAN I'M DOING THIS CARD" new customers, since it's outraegously generous if it were indeed as "free" as it sounds initially.

I wonder if I can pay the debt online immediately? If not I imagine the bill and subsequent payment of the owed $500 or so would be easy, and I could purchase over $500 in one month/billing cycle and then pay it ALL off immediately, owing no interest. Does that sound like it would work or am I missing something?

Of course the 200 dollars of points could take two months to clear but eventually I should get that money, so I can buy better tires or what have you and pay less than cheaper tires by opening this account, sorta getting a refund check in the mail in a month or three.

Doesn't sound too bad to me. I could get a checking acct at chase to pay it off with, too, and get another $125 for that... $325 isn't bad for a few hours of paperwork/bookkeeping.
That is of course if there's no glitches, I fear most the glitches/complications that could arise and make it more of a hassle than warranted (I could work a day and save the same amount, for example.

All part of learning, I suppose?

 

[3p141592654]

You are right to be suspicious, but I am pretty sure its legit.

I believe the $100 offer comes with 0% balance transfer, while the $200 offer does not.

If you pay your statement off each month you will incur no penalties or interest. The $200 will be free and clear.

Name: applynowdc1.chase.com
Address: 159.53.52.1

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OrgName: JPMorgan Chase & Co.
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[Figit090]

You are right to be suspicious, but I am pretty sure its legit.

I believe the $100 offer comes with 0% balance transfer, while the $200 offer does not.

If you pay your statement off each month you will incur no penalties or interest. The $200 will be free and clear.

Name: applynowdc1.chase.com
Address: 159.53.52.1

# The following results may also be obtained via:

# http://whois.arin.net/rest/nets;q=159.53.52.1?showDetails=true&showARIN=false&ext=netref2
#....
#

Thanks for checking that, I never thought of using whois for that.
What importance is the 0% balance transfer? --EDIT-- forgot about Google; I take it that would be important only for transferring one debt on another card to this one; not important to me since I don't plan on ever doing that.


So I just called Quick Lane to get info on prices and WOO! they match prices (even online according to the associate I spoke to at my local shop), and there's a $100 discount plus a free alignment on 4 tires...plus a free alignment/balance/rotations/flat repair.

So am I missing something here; I could:

Get a chase freedom credit card and buy the tires+misc for $500 bill: $200 in credit, payable by check (i think)
Receive manufacturer's discount for 4 tires (i can pick just about any): $100 check in the mail

Sooooo ~$500-200-100 = $200 (not factoring in free alignment, figure 60-80 bucks?)

They aren't free, but if I do all that and pay it off immediately (well duh), I pay $200 for my new tires. Am I missing something or do I just have good timing? I know it will be some work but...I dont want to fall prey to "too good to be true" syndrome. lol.

 

[3p141592654]

You need to watch your cash flow. The $500 bill is due on your first monthly statement. If you don't pay it off you will incur interest charges. You will need to wait up to 5 months to get your $200 back, 3 months for the offer period, plus 8 weeks processing time. If you can up front the $500 then this is a good deal for you, otherwise, I don't recommend it.

Also, it looks like that link is now dead, and it takes you to the $100 offer. You may only have the $100 offer now.

 

[te72]

Something that I've done since I bought the house that I also find a good suggestion for anybody with a Supra or ANY other bills really:

Keep $1000 in your bank account at all times.

I don't think I've dropped below that threshold in the last year or so, nor have I needed to. However, it's good to know, that if something unexpected happens, I have nearly a month's worth of bills that I wouldn't have to finance with the credit card.

That said, I have a pretty damned good job for someone without an education or any special skills, just a guy with a good work ethic. Not until this job (or before I bought the house anyway) would I have been able to reliably keep 1k in my account, I just didn't make enough, or couldn't be bothered to save.