I logged on to one of my credit card accounts today just to make sure there was no balance and no payment due.
This is a card I sometimes use for small purchases and since it has a $48,000 credit limit, I don't keep it with me all the time. I don't want to have that much temptation sitting in my wallet. (At one point, I had 3 credit cards in my wallet with a combined credit line of over $70,000.
I now only carry my debit card, one credit card (with a $20k limit) and my corporate credit card (for work).
This credit card has a rewards program that gives 1 reward point for every dollar spent. In order to redeem your points, you have to have a minimum balance of 2500 which is equivalent to a $25 gift card.
I noted my rewards balance and saw that I only had earned 511 points. The credit card company was nice enough to remind me that I only[b/] needed to spend $1989 more dollars in order to get a $25 gift card.
Are you kidding me? Do people really fall for this crap? Unfortunately, they do. I [b]used to be guilty of this myself. I HAD to get those rewards points so I HAD to use my card. I'd find an excuse to buy this or buy that just to get to the minimum amount needed to earn rewards.
The problem with this is that I bought things I didn't need and I never paid the card off in full. Even though the credit card company was paying me to use the card, I was paying them much more in the form of interest each month.
Thankfully, those days are behind me now. I've learned my lesson. I only use my credit card if I can afford to pay the balance in full.
What about you? You have any issues with rewards credit cards?
Credit Card Rewards. Ripoff?
July 24th, 2011 at 11:47 pm
July 25th, 2011 at 03:59 am 1311566384
Also, there's no such thing - in my opinion - as a ripoff when you are getting rewards for money that you would already spend otherwise (at least, that's how credit cards should be used). Granted, there are cards that are better - like the Capital One Cash Rewards and the Chase Freedom cards. I have the Chase Freedom on the way in the mail. Discover and AMEX have great cards as well, and I may get one to use mainly, and then use my Visa wherever Discover/AMEX is not accepted.
July 25th, 2011 at 04:36 am 1311568562
July 25th, 2011 at 04:42 am 1311568947
July 25th, 2011 at 10:36 am 1311590168
@snafu: I should have clarified that as long as you pay your balance in full each month and use your card for purchases you would have made otherwise, there is nothing wrong with credit card rewards. (As long as there is no annual fee!)
July 25th, 2011 at 05:23 pm 1311614603