Cards with cash back etc..

[Marchvet]

My wife wants to get another credit card that offers points/cash back etc. I spent over 7 years helping her get rid of a huge debt and now she has only a couple of credit cards and a great fico score.

She thinks that it will help us with traveling and savings. Me personally, I think we should not get another card and worry about the remaining debt we have. Both of us still have a small amount of student loans and she has a car payment.

I would rather pay those off first and worry about another card later. She thinks we should get one now and start building up points/cash back.

With credit card companies cracking down on those things, should we get another and start or follow my plan and save/pay off remaining debt?

[dodfire]

Welcome to the forums...

For everyone here to better help you with your questions can you give us some more detail about your credit profile and debt?

[Marchvet]

My latest fico score was 790. Debt $8500 in student loans. 3 credit cards with $1500 only on one(will be paid in full in 3 months). Mortgage at $1400. Wife has about $15,000 in debt and her fico the other day was 760.

We have no issues with paying cards in full(most of the time), but my concern is adding another card on. Is there anything I'm missing? Very new to the myfico forums.

[dodfire]

You mentioned you were interested in cash back...and points.

What 3 cards do you currently have?

[samset93]

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@Marchvet wrote:
My latest fico score was 790. Debt $8500 in student loans. 3 credit cards with $1500 only on one(will be paid in full in 3 months). Mortgage at $1400. Wife has about $15,000 in debt and her fico the other day was 760.

We have no issues with paying cards in full(most of the time), but my concern is adding another card on. Is there anything I'm missing? Very new to the myfico forums.

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If your wife wanted to get another card to take advantage of the cashback/points I say go for it. But if she's applying because she wants to get additional purchase power, I'd stay put. 

For me personally, I hate debt (1/2 way thorugh my goal of finishing undergrad debt free!) and just not comfortable enough to take out loans, etc. But getting a new cc that has good benefits (cashback, etc) is a good move. If you can spread around your current spending to the appropriate CCs (food to Freedom, home improvement to Discover, etc; this period anyways) 5% back is nice. You can use it to travel, get merchandise, or even take the cash to pay off debt.

Last but not least, consider joining a CU. although they don't usually have great promos (exception for PenFed, NFCU, etc) they'll be more liberal as far as initial CL, and you'll usually get a no-fee with higher interest banking products (savings, cd, checking, etc)

just my 2c.

[crunching_numbers]

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@Marchvet wrote:
My wife wants to get another credit card that offers points/cash back etc. I spent over 7 years helping her get rid of a huge debt and now she has only a couple of credit cards and a great fico score.

She thinks that it will help us with traveling and savings. Me personally, I think we should not get another card and worry about the remaining debt we have. Both of us still have a small amount of student loans and she has a car payment.

I would rather pay those off first and worry about another card later. She thinks we should get one now and start building up points/cash back.

With credit card companies cracking down on those things, should we get another and start or follow my plan and save/pay off remaining debt?

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It is possible that your wife is correct. Several cards offer free hotel nights as sign up bonuses and there are cards with 5% cash back on certain purchases that you would make anyways like gas, groceries, and restaurants. Many of those cards have no annual fee. This would save you money each month. If managing payments and spending  is not an issue, adding a reward card or two will not hurt you in the long term. There is an slight initial score drop for the inquiry and the new credit, but it is recovered quickly (6 to 12 months). The added credit line increase will help your utilization percentage and might offset some of the drop in score anyway.  If, on the other hand, access to a new credit line will cause temptation to overspend, then you will need to keep that factor in your decision process.

[Marchvet]

Currently none of our cards offer any programs. I have a orchard bank which was taken over by cap one recently. Maybe they will offer something in the future.

[09Lexie]

Is your wife's debt higher due to the car? What's the income? Seems like you are handling your finances quite well. What concerns me is if your wife has a spending problem but if not then getting a cc that will reward you is a good idea.

[Marchvet]

Actually she learned her lesson a long time ago and paid off the debt she incurred. Seems like if she's going to use it to build points etc, then it's fine. We have no need for increased credit at this time.

Thank you everyone for the advice, it's greatly appreciated.

[longtimelurker]

It's hard to give advice because it depends so much on you and your wife!

In a perfect world, it would make great sense to get a cash back card that gives some cash back (or other reward) on "everyday" spending, stuff such as grocery/drug stores/gas where you would spend anyway, and this in effect reduces the cost.

But: if there is any possibility that you would find yourselves carrying a balance that would quickly more than negate the gains.    This unfortunately can happen because a lot of research shows, on average, people spend more with rewards cards than with non-rewards/debit card/cash.  Part of this is because you take the rewards into account when making buying choices ("Yes, this is $100, but that's really only $98 with my 2% cashback, so that's a bargain and I will buy 2!") and end up spending more.

So if you can resist, yes, get cashback cards and reduce your debt quicker.  But if you are not sure....