@RSX, agreed!
After my wife's business failed and after my (former) business partner ran up a quarter-million in debt in my name on credit cards I didn't know existed, I was shown the exit door of the credit world, and effectively lived in credit pergatory for over 7 years while I figured out how bad things were and then went 5-years in a Chapter 13. Given I travel, sometimes a lot, sometimes not at all, it was a challenge for those 7 years each and every time I needed to head for an airport or hotel.
The other thing the anti-CCers seem to ignore is the whole spectre of rewards; looking back at the money I spent on my debit card between 2013 and 2020, I figure I lost out on an easy $3,000 to $4,000 in cash rewards; not insignificant.
@longtimelurker wrote:
@Horseshoez wrote:
The other thing the anti-CCers seem to ignore is the whole spectre of rewards; looking back at the money I spent on my debit card between 2013 and 2020, I figure I lost out on an easy $3,000 to $4,000 in cash rewards; not insignificant.
I think Ramsey and others do address this, saying that most people don't make anything overall in credit card rewards, interest and other fees more than eat this up any gains. And obviously, if you don't PIF (nearly) all the time, that can be the case. I've heard a low figure (maybe 5-10% gave a net gain) from someone I respect, but don't know where that figure comes from. He also said, and I'm sure the same is true on MyFico, that nearly ALL his clients say that they are in that 5-10% (PIF and getting good rewards) and he's really not so convinced!
Prior to the financial melt down of our businesses, we pretty much paid all of our cards in full every month; then the meltdown happened and we shut off all of our credit cards back in 2013. My wife and I separated due to the financial strain on our relationship, she filed a Chapter 7 and I filed a Chapter 13, and then in 2020, we got back together just after I got my discharge. The good news is we're back to where we were before our financial issues, everything gets paid in full every month AND we're making some significant bank on top of our expenses.
So, at least in our case, rewards are paying dividends, and will continue to do so. As for the number I posted regarding the lost rewards during my Chapter 13, that assumes only a 1.25% average cash back amount per dollar of spend; pretty good odds it is a low-ball estimate.
@Andypanda wrote:
@coldfusion wrote:
@longtimelurker wrote:
@Horseshoez wrote:
The other thing the anti-CCers seem to ignore is the whole spectre of rewards; looking back at the money I spent on my debit card between 2013 and 2020, I figure I lost out on an easy $3,000 to $4,000 in cash rewards; not insignificant.
I think Ramsey and others do address this, saying that most people don't make anything overall in credit card rewards, interest and other fees more than eat this up any gains. And obviously, if you don't PIF (nearly) all the time, that can be the case. I've heard a low figure (maybe 5-10% gave a net gain) from someone I respect, but don't know where that figure comes from. He also said, and I'm sure the same is true on MyFico, that nearly ALL his clients say that they are in that 5-10% (PIF and getting good rewards) and he's really not so convinced!
The numbers may have been skewed over the last 16 months or so, but the figures I used to see claimed were a lot closer to 50% than 10%.
I've seen a YouTube video of his saying that no one has ever become a millionaire with CC rewards. I would rather have the Money the CC save me than not have it.
Agreed, I will not become a millionaire from my CC rewards either, not even close; that's what my 401(K) and other investments are for. However, cashing in on $500 worth of rewards here and there is a nice way to treat myself, my wife, or my family to something nice I wouldn't otherwise splurge on.
@disdreamin wrote:
@longtimelurker wrote:I think Ramsey and others do address this, saying that most people don't make anything overall in credit card rewards, interest and other fees more than eat this up any gains. And obviously, if you don't PIF (nearly) all the time, that can be the case. I've heard a low figure (maybe 5-10% gave a net gain) from someone I respect, but don't know where that figure comes from. He also said, and I'm sure the same is true on MyFico, that nearly ALL his clients say that they are in that 5-10% (PIF and getting good rewards) and he's really not so convinced!
I find it funny that he doesn't believe his clients. I'd venture a guess that many here are more educated about card selection and good rewards than the general public. Personally, the last time I carried a balance was about 15 years ago and it was a large sum for one month (plus trailing interest the following month, of course). It was an unexpected expense that I couldn't delay and my cash reserves at the time didn't allow me to cut that check immediately, unfortunately. Since then, haven't paid a dime in credit card interest and I can't see why anyone would doubt my word on that.
Mainly because so many here claim the same, along with making over 6 figures a year. When the reality is only 5-10% it's hard to believe over half the posters here do it. While it's possible, statistically it's highly unlikely. Even though there's anonymity people don't want to look bad on the webz. Personally, I go with whatever someone posts as the truth. If they're lying, they're only hurting themselves when it comes to getting help.
