IGX

I've been reading about financial management, and was motivated to try to earn rewards on my dollars.

Thinking about just using it for the basic bills - rent, utilities and groceries, gas, occasional plane ticket.

Everything else is off my debit card, and I plan to link the credit card to my checking account to pay it off automatically.

I'm terrified of debt, but I'd like to drive my credit score higher, intelligently.

Any good advices? Got a BarclayCard Arrival after reading an article about it and other travel cards.

Bram wrote:I've been reading about financial management, and was motivated to try to earn rewards on my dollars.

Thinking about just using it for the basic bills - rent, utilities and groceries, gas, occasional plane ticket.

Everything else is off my debit card, and I plan to link the credit card to my checking account to pay it off automatically.

I'm terrified of debt, but I'd like to drive my credit score higher, intelligently.

Any good advices? Got a BarclayCard Arrival after reading an article about it and other travel cards.

Consider getting a regular credit card and using it for small things on a monthly basis-- this will boost your credit score. Given your attitudes toward debt, you might consider getting a secured card and using this for bigger purchases. Protection from theft and fraud are much greater with a credit card than with a debit card, and you can't spend more than you have with a secured card.

Ok, thanks Turd :)

Your attitude on debt will serve you well. Take it from an old guy who had to learn the hard way.
Try this guy for a starting point on how to maximize points.

http://thepointsguy.com/beginners-guide/

What sort of rewards have appeal?

The right card can help you categorize your expenses which can be useful. Paying on time is good. Paying 5 days early is apparently extra good as it relates to your credit score.

I almost never use a debit card because when criminals access my credit card I have protections, when they access my debit card, they have access to my real money.

I think you're European so your debit cards might have the chip & pin system for POS security like the Canadians. The USA is behind the times on card security and will be relying on magnetic strips only until 2015 +/-.

Thanks Tim! That looks like a solid resource.

Stephen, I was thinking to rack up miles for flights, but I'm not really sure of what other reward programs exist. I know Bank of America offers 1-3% cash back.

Dr. D,

Thanks for the tip, I'll plan on paying extra early.

I haven't heard of the expense management, but I can imagine that not using 1 card for everything will have that benefit.

I'm American. I use my debit card for everything, and for a very long time too. B of A has taken care of me on any fraud issue extremely well, never lost out on money through them.

Lastly, I think if I'm gonna do this right, I'll have to do a total budget, which I've never pulled off.

Heard 50% for essentials, 30% for fun, 20% for debt/savings/retirement.

See if you can't automate your cc payments from the account your debit card comes out of...every 25 days or whatever the fuck it is that the CC companies use to wring the most interest out of you.

Here's a tip. Pay the balance of the card weekly if you plan on using it regularly, that way the balance will never get out of hand, unless you go full retard.

I actually pay my balance every couple of days. I use my CC the same way I would use a debit card but this allows me to get some cash back and it's a safer form of payment. I always cringe when I see people using their ATM/debit card at some hole in the wall corner store with a card machine made in Romania.

Having your debit card skimmed is a pain in the ass. The bank will most likely get your money back for you but you'll be out of pocket the whole time they investigate. At least that's how it is here in Canada.

Bram wrote:Stephen, I was thinking to rack up miles for flights, but I'm not really sure of what other reward programs exist. I know Bank of America offers 1-3% cash back.

Here's where I was several years ago and how I got out.

I paid cash for everything, didn't have a non-corp credit card, didn't own a home or have a car payment. As a result, I really had no credit at all. Home loan was a huge problem, so it needed fixing.

I looked up Ramit Sethi's advice on this, and got a secured card from my bank (anybody can get this). Kept that for a year, paid off every single month in full on autopay, and then got an American Express Starwood Preferred Guest (SPG) card.

SPG is the best *airline* rewards card, because you can transfer points to most airlines, and you get a 25% bonus every 20,000 miles you transfer. That's unless you fly United, then there's a penalty. You also get bonuses if you stay in Sheraton/Westin/W hotels, and points can be applied there.

Amex isn't taken everywhere, so I got the AAdvantage Citibank Visa card for American. I call and request credit limits on both cards every six months, since credit availability and utilization ratio (having 2k balance on a 4k card is very bad).

Credit score was way up within 18 months, bumping up against 800 after 24. Also went to Brazil and Argentina for my honeymoon on points, though my wife also got the same cards so we had a lot of points by then.

There are cash-back cards that may be a smarter move than SPG if you specifically don't intend to fly much.

You are not using the system. I woke up to points when a friend took his wife to London on the points they earned. They had been racking them up for a couple years I believe.

Now I only use cards that give me points, both business and personal. I have a few bills on auto-pay through the card, then pay off balances a couple times a month. I use the credit to statement option every time I can net out $500 or more.

If you manage the cards, it is a great way to get more out of things you would be buying/paying for anyway.