Comments on: My New Credit Card: Not for Credit

By: Steve

Steve — Wed, 24 Dec 2008 16:30:37 +0000

I applied for the Schwab card after you introduced it to everyone. I had a decision back within minutes and have already received my card and started using it. Prior to this card I used a Chase Freedom Visa and we received $750 in checks over the past year. As with the Chase card, all spending will go on the Schwab card and it will get paid off every month.

Since the rewards get deposited into a taxable brokerage account, my plan is to just pile all the money into a tax-free municipal bond fund. I also get ESPP proceeds into this account and our intention is to use the account as a debt payoff account. Once enough money has piled up in there to pay off our remaining non-mortgage debt we’ll pay it off. Then the account can just sit there and accumulate for the future.

By: Bill M

Bill M — Tue, 23 Dec 2008 20:13:48 +0000

I have 3 rewards credit card

American Express SimplyCash that pays 5% on cash(any gas station), 5% on my cell phone bill, 1% on everything else — I use just for this purpose
ChaseFreeDom, 3% on groceries, fast food, etc – I use just for this purpose now before I got the Schwab 2% on everything else. Works pretty well, about $60-$70 a month I get back on rebates.

By: Andrew

Andrew — Tue, 23 Dec 2008 19:11:25 +0000

I’ve been using a Citi Diamond Preferred Rewards card for several years now and I’ve milked Citi for $1300 in gift certificates without paying a single cent in fees or interest. Too bad they are refusing to renew my card next year, but I can probably squeeze a couple more hundred dollars out of them before then.

As soon as you figure out how to use a credit card without getting in trouble, they are really a great financial tool. You get protection from fraud and overdrafts because money isn’t coming out of checking immediately and you can dispute fraudulent charges with waiting for your funds to be returned. Using credit for everything helps me track spending in Yodlee Moneycenter (or Mint or any other online account aggregator). If I used cash exclusively, I’d have a much harder time figuring out where all those $40 ATM withdrawals were going.

Reward cards are kind of a no-brainer for me. I’m going to spend the money so why not get some of it back in some form of rewards. It’s like passing on an employer 401k match. Free money, no matter how little, is free money.

By: The Weakonomist

The Weakonomist — Tue, 23 Dec 2008 14:24:33 +0000

I’ve used chase rewards for about 18 months now. 3% on groceries, fast food and gas. 1% on everything else. I just took my first check from them and it feels great to have an extra few hundred bucks in my pocket. I wish they would pay me for referring business bc i’ve gotten a few others on the card as well.

I only wish they’d let me design my own card, but that’s only so I could put a Jedi on my card to protect it from theft.

By: Bill

Bill — Tue, 23 Dec 2008 14:23:05 +0000

Set your card to pay the balance in full every month with an EFT or auto-check. You’ll never miss the payment and never carry a balance…just be careful of what you buy on it.

By: Claire

Claire — Tue, 23 Dec 2008 13:50:01 +0000

I also just got the Schwab card – but I really think you should look for a rewards checking card (yes – I think they are worth the “hassle”).

I recently signed up through Charter Bank for their 6.1% APR interest rewards checking account. It is – so far – quite amazing and I now heartily recommend Charter as opposed to the dozens of others I looked at. The customer service is far superior to anything else I have seen at banks of late, and although you *cannot* call on weekends due to the bank’s small size, they are excellent at responding promptly to emails, etc.

More info on why I chose Charter and their requirements here. If you do want to do Charter, you should do so before February, when their APR will drop to 5.1% for new accounts.