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we need to spend MORE on our credit card!!!

May 29th, 2009 at 09:48 pm

So I realise it's a rather controversial title. But I also realise there are a few people here who carry my line of thinking in the rewards aspect of credit cards.
There is NO WAY in the world do I ever advocate a credit card for anyone remotely irresponsible with spending. Let me just say that!
Credit cards are a very useful tool for many people. I have never had a problem with mine, and I currently have about 6. (I intend to close some and only have two or three very soon.) I also know that people get themselves in debt with credit cards over things that they can't help, like medical expenses or vet clinics or car repairs. That is unfortunate, but with motivation and a plan these things can be rectified.

Ok, so back to my title (just had to put a disclaimer in there!!! so that people realise I know what I'm talking about!)

I got our bill for the month. The past two months it's been roughly the same amount, so I would say our spending is pretty much the same as the months go along. We've managed to earn around 5300 points in just over two months. 3000 points equals a $25 gift card, so I can safely say that we probably earn around $50 every three months, or a bit more. Points are, I think, 1 for every $1. I am not quite sure. It could be $2 = 1 point... anyway. They have a lot of special offers that contribute to points as well, which helps. It's a good rewards scheme in our neck of the woods.

HOWEVER: THIS IS NOT GOOD ENOUGH!

My grand plan was to earn enough to offset our $395 annual fee ($395 for an everyday account, unlimited withdrawals, homeloan account, offset account, free redraw, free extra payments, free gold credit card, free debit card, free high interest savings account, free financial planning interview, 10% off insurance, 0.05% off the standard rate - ok so obviously NOT free, but $395 a year for all those ain't that bad here).

Anyway, so $50 every three months means $200 a year. Which means in the end our banking costs us $195. Take into account we probably earn around $5 in interest a month, so that's $135 a year in banking fees.

So, I have come to the conclusion that we do not spend enough on our credit cards - OR we do not earn enough interest. My problem is, to earn interest, we have to put our money in an account that does not SAVE us interest off our homeloan, so that is basically out of the question. I do not think we can spend enough to offset the entire amount, but I think with planning, we can utilise our cc's a bit better. Currently we do forget and pay cash/debit for a lot of things. So this is a bit of a wakeup call I guess! It will make me think when I pull out a card to pay for something - but not in the usual way!


1 Responses to “we need to spend MORE on our credit card!!!”

  1. HouseHopeful Says:

    I utilize a credit card for rewards benefits and pay it off monthly as well. Great job on identifying that, as it stands, the card is not benefiting you given your fee versus rewards. Good luck with moving forward to make the card work better for you Smile

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