@UncleB wrote:This is of course subjective, but if it were me I would think really long and hard before doing this.
The fee charged for the transaction would be more than the rewards, so you are losing money from the beginning. Since you mention it is possible to send a check that would be my choice... I know stamps have a cost, but it will be much less than you'll lose in fees, and that would keep you from having to bother with the ATM or the courthouse.
The only instance I can see this being a good idea is if you are expecting a windfall or other large payout of some type in the near future (to pay off the balance); in that case I might consider paying with the credit card. Otherwise, it's the same as paying for gas and groceries with a no-rewards card... it's generally just not a good idea unless it's a dire emergency. Financially, it just doesn't make sense.
Just my 2¢.
Time has value, how much is admittedly subjective.
To give an obvious recent example, I'm seriously rethinking my school plans now. I need the 4 year degree, I should do it at a UC campus, but I live call it an hour away from UCLA and and hour away from UCI, and I just spent the last 4 years working on my credit and finally obtaining a mortgage.
It was already starting to drag even optimizing my schedule to a 3 day class week, and in the summer I'm looking at all 5 days at one point unavoidable, or 10 hours, or give or take 9% of my waking life. Lame, and worth spending money to optimize that out of my life. This doesn't of course include the car expenses which pencil out to around 1K/month... but long story short I'm really becoming sorely tempted to just pack up everything into storage, take some clothes, school books, and computer and go sleep on an air mattress on someone's floor for $300/month and just rent the condo out (for like 1800ish) and have a better quality of life.
Anyway all that to say, don't discount the time involved in any transaction, and even for something like going down to the post office (which truly sucks in my neighborhood), a convenience fee is well worth it to skip that insanely absurd mess.
@Anonymous wrote:I just found out I can pay child support with a credit card. The fee is 2.35% which isn't bad considering no more bank trips (to my bank's ATM to get cash and then to the only bank in town that accepts the payments) or trips to the court house (metal detectors...how inconvenient...right?) or no more stamps/envelopes if I mail it in. Plus, the card I am using gives 1% cash back so that will offset some of the fee.
The main reason why I chose to do this is because the card I will be using has 0% for 18 months on BTs and purchases. My original plan was to BT a few small balances onto this one to consolidate into one card payment. The fee for BT on this card is 5% so instead of paying the 5% up front for BT, I can use the child support cash to pay off the other cards.
It's really just a 'Rob from Peter to pay Paul' type scenario, but I don't see any flaws in the plan. Do you?
Yes, this will work, because you are avoiding the 5% BT fee, as others have noted. I call this type of operation a "Balance Transfer In Place". Check the payment coding, but it likely will be a regular purchase if you are going through a payment processing group.
What are your other cards that currently have balances? Because many cards have ongoing / recurring BT offers, so there could be suggestions for future BT steps.
And while we're at it, what is this card that charges 5% on a BT fee? That's painful.
Thanks for the update. It will be interesting to see if those categories show as purchase or cash advance.