I'll get right on that. Thanks I appreciate it!

D

 

Not at all I'll charge a .99 hamburger at Wendys and every other thing I but I will charge. I carry bout 200 in my wallet always just in case but why would I not get free money using the card? I'm 21 years old and have had credit cards since I was 18 I have 3 of them currently (not including my student one that I don't use) and a credit score of 753 (it would be more but started the cards close together and 2 recently, still an exceptionally good number)

It's free money why the heck wouldn't you take advantage of that? We get screwed everywhere else why not get a little back.

P.S. - I pay it off in full every month btw and won't but anything that I don't have or won't have the money to pay for it

 

Not stupid at all, as long as you pay the credit card bill in full on time each month. That's a lot more financially sound than buying toys.

 

Good thing to call this out.
I was talking about net or take home pay.
This is after 401(k) ( or similar program offered at work ) is already removed before getting taxed.
This is pre tax money, so a 10% contribution from gross pay, does not mean your net pay will be short the same dollar amount.
If you are lucky enough to be on the edge of 2 tax rates, you might find out contributing 15% means a 5% net pay change.

If you cannot afford the max of 15%, at least contribute the max amount required to maximize company matching if offered.
Your company might match 1:1 for the 1st 6%, or it might be a 1:0.5 matching of the 1st 6%.
What ever the amount, take it from the company. Just keep an eye on vesting percentages, if applicable.
Some companies will have 4 or 5 year vesting of the matching funds. The standard ( if they use matching ) is 5 years, which means every year you work at the company, 20% more percent of what they match you get to keep when you leave. If you work there 3 years, you get to keep 60% of what they matched. Other companies will have no vesting schedules, HR or HR employee manual will have this info.

The time line, there are several examples of starting at 22 and contributing for 10 years and stopping versus someone starting at 32 and contributing to 57, both using the same fixed dollar amount every year, and using the same rate of return.
Person #2 puts in 2.5x the amount of money, and will have ~ 50% of the money saved at retirement time.

Key to saving money for any thing, save early and save often.
Works for buying a new truck, and works for retirement.

If you maximize free money usage, you won't care what the rate is to buy a new truck, as you will be writing a check for it.

 

A lot of good advice is being given in this thread. I PCS to Ft. Hood in the summer, so I'll look at cash back for certain things like groceries like Chase gives. I like USAA Reward Points, and if I used that CC to pay for bills, I'd have enough points to get a free plane ticket if there was any emergencies.

I started living pay check to pay check and using my credit card to pay for fast food and decided I was tired of that, so I started not carrying my credit card on me. I'm going to implement that as well when I get back from this deployment, I liked it and kept me on my budget. I set a budget to spend $100/2 weeks for lunches. I tried $50 but that went to fast for 2 weeks.

Any advice on credit cards? USAA recommends having no more than 2. I opened a third one just to get 15% off my purchase and read online that canceling a credit card with less than a year open doesn't look good. I plan on canceling it when I get home since its an AE card and all it gives is huge discounts on clothes. Being in the military I don't need much of a wardrobe.

 

If you can make cash back on it, why not put it on your card? It's what I do, and just pay it off every bill.

 

That's what I do. The only time I haven't been able to fully pay off my card at the end of the month was when I bought my wheels and tires (very first purchase with it), but I was able to finish it off the following month.

 

I use my (Chase Freedom) CC for everything i purchase. I pay my bill every two weeks. So far, I've owned the card for about 4 months and have received $200 cash in rewards. I doesn't make sense financially NOT to use it.

 

I've known people who get the 0% interest credit cards and take a cash withdrawal and invest it in something safe. It's free money and it's free interest. Your credit rating is like your age. When you're 4 years old a month is a long time, because you relate it to your life. When you're 40 a month is very short. If you only have one or two lines of credit and you have an aw crap moment and pay one late enough to report, it will effect your credit report much more than if you have a couple more lines open. This is not to say go out and open a bunch of lines of credit just for the heck of it, but open them if it is prudent.

 

Can I ask how much you're putting on it? Because mint.com said I can save up to $600 in 3 years, and get 5% cash back.

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How does one know which credit card to cancel? Say I have a 5 year old credit card (with Patelco) and a 2.5 year old credit card (with my bank and love it). I'm also mostly interested in sky miles, for future family emergencies or sending the wife home to visit her family.

For cash back, can you tell me how this would work?

Groceries: $500/month
Gas: $480/month
Total: $980/month

So would I be getting 9% cash back? So around $88/month back?

 

I use mine to buy gas and pay my rent with, and then at the end of the month it's set up so it pulls the money straight out of my debit account. It's really the easiest way to build credit when your 19.

 

Have you ever heard a millionaire say they got rich off cash back rewards on their credit cards? I would say all the energy and time you use to make sure credit cards are paid you could use to invest your money wisely and earn a better return on your money. Millionaires don't have credit cards. Start practicing the good habits that wealthy people do and you soon yourself will be wealthy and laugh at the mere thought of credit cards.

 

Not too sure what else the USAA card gives you, you might want to check on when the rewards can be converted to a plane ticket.
It is most likely the back of the bus, 1st to get booted off in over sold conditions ( which happen a lot these days ), and you cannot use it anywhere near a holiday.

If you are making cash on a cash back card, if this ever happens, you can pay for the ticket outright ( and be ahead of the points passenger in oversold conditions ).

Don't limit yourself with a straight rewards card, not worth pigeon holing yourself. If you really want to have the option, i think Chase Sapphire is this type of card ( you accumulate points that can be converted to cash ).

If you can, make your lunch at home. Don't know if that works for you or not ( when you are here ), but this would make the 100.00 go a lot further and allow you to save more money towards the goals.
When I started out of college, lunch was in Tupperware for me.

I use the Dunkin Donuts example a lot. if you stop every morning, it is only $ 2.35. If you figure out your yearly outlay, it is ~ $ 500.00 / year for standard coffee, it only gets worse if you look at more custom drinks or going to the 'green mile'.

Number of cards depends on what they are.
If you are talking multi use ( Visa, MC, Amex ) 2 is what you should target, 3 should be max and carefully considered.

Don't do the open a card to save xx% deal, stick with the cash back card. You are talking a 10% delta in the AE case ( if it was 5% vs 15% ), how much did you save ?? Did you buy $ 300.00 in clothes or $100.00 ( or less ).
For ~ $10.00 you started another run on your credit report, and long term it is not worth it, they are going to hit your credit report every 1 to 3 months to check up on you. These are the things that can cause a lowered credit rating.
Just say no thank you. When they start in with the but you can save xx.xx today, repeat no thank you. The 3rd time they make a run at you ( I think some get spiffed on new accounts opened the way they keep after it ), ask them "Where did you get your finance degree from and why are you working here if you are that good ?"

Check the issuing bank for the cards you have.
It should say on the back ( HSSC, Chase, etc ). Call the issuing company customer service number, and ask them what cash back type card they have, and you want to convert your existing card to another one with cash back.
Most of the time they will convert you on the phone ( might have to transfer you to another department ), and send out a new card.

I switched my AMEX green card years ago to a AMEX free hotel card when they introduced it, to remove the annual fee and the account number stayed the same, and the year I started ( AMEX puts this on the cards ) stayed the same. Still looks like the same credit line on my reports.

Most issuing banks want to keep existing customers ( reduce churn ), so if they have a choice between switching the card or loosing the customer, they will switch it. The logo on the card is not going to be happy about it, but the issuing bank can deal with that.

Stop using mint.com, go direct to the issuing bank's site and read on the cards. chase Freedom :

 

Time and Energy to do what ?
5 min to setup auto pay of the full balance on the due date.
Wow, 5 min he did not spend looking at investing money he has not accumulated yet.

Might want to read the millionaire next door to find out, yes they do this.
Have for decades.
Holding on to your money as long as you can ( working for you ) is how to amass wealth.
Yes millionaires have Credit cards, they don't walk into a restaurant and say bill me. Warren Buffett and Bill Gates can't even do this.

 

Millionaire Next Door is an awesome book, especially for beginners. It shows what you are striving for (if you're trying to be a millionaire). It also shows what the typical millionaire has and values. One thing I've learned over the years is taking 5-10 minutes to save/make and extra $30 is not wasted time. It takes me an hour to make that at work. I've started comparing everything I do to make money with how much I get paid an hour. If it took me 1.5 hours to save/make $30 I would probably still do it. I've thought about paying all of my bills with my credit card, but I need to increase my limit by about another $2-3k before I do that. One check is much easier to write than four or five.