Thursday, July 19, 2012

A Confession of Sorts

I have a little secret.....

In June, my Discover Card (CC4), expired.  I had to call to activate the new one.  See...Discover does 5% cash back on certain purchases throughout the year.  And for this summer....Gas was one of them.

As a household that can go through over $500 in gas for our cars A MONTH, this could add up. Discover was offering up to $75 cash back for using your card.  Well, we have to put gas in our we have used the card for the rewards, and as soon as we get home, pay the credit card with the "cash" from our checking account (where our debit card draws from).

The representative that helped me offered "great customers such as myself" another incentive.  If we charged $1,000 per month for July, Aug, and Sept, we would earn a bonus $150!  Discover has Home Depot gift cards that you can get with your Cashback Bonus, with a 10% discount.  Remember the deck project......see where I am going with this?

So we have been using (and paying immediately) our card for standard purchases.  We are not carrying any more of a balance than we were before.  Groceries, gas, co-pays at the doctor....all going on the card.

So we talked about using our card for our other bills.  We have to pay electric, oil, cell phone, cable, student loans.  We pay all of this each month from our checking account.  So why not use the card, and earn some cash back (we get 1% for regular transactions). This has not been as easy as I thought.

Student Loans won't let you use a credit card.  Electric charges you $3.50 per transaction!  I haven't tried oil or cell phone yet.  Cable isn't a problem.

Our personal property taxes were due this month too.  And right on the bill it says you can use your credit card.  Yippee!  We already had the money for again, the idea would be to charge it and pay it off immediately.  For $200 in taxes, we would earn $2, plus it would be applied toward our $1000 per month that we have to spend.  Well....they wanted to charge us $7 to use our card. earn $2, I would have to spend another $5.  No thanks.  I wrote a check and was done.

I have liked doing this.  They have a nifty graph that tracks your transactions.  And the cash back will help pay for our deck.

I will say that we have NOT used our card for anything other than standard purchases that we would have made anyway using our debit card.  We aren't floating anything.  And this is not a gateway into using it for the sake of using it.  This is what is known as responsible usage.

Anyone else do this?  Comments (please be nice)?


  1. I've done it for years. I get cash back on vehicle purchases and some travel perks. Paid in full every month. I use it for orthodontist, groceries, gas and kids sports fees.
    Now I share one with the dh for 1-2% cash back depending upon where it is used. Again paid in full every month. If it can't be paid for in cash that is on hand it doesn't go on the credit card.

    As long as you don't rack it up, pay in full every month it is better than cash because of the rewards. Deep trouble if you let the balance get away!

  2. I think this is great but I do not have enough self control to pay my bills in full and I would go crazy so this isn't an option for me.

  3. We do this too. Unfortunately, because it's a credit card, we allowed the balance to run up because we didn't pay it off right away. Now we are working on paying it down, but we still use it for all household purchases because our bank charges a fee for using the debit card.

    I'm working really hard on getting my spending down and having the money saved to pay off the purchases for the month and then some extra to work on the balance. Unfortunately, things just keep coming up like my oldest sons' teeth, which have an enamel defect and ALL have to be repaired, my middle son is having his wisdom teeth out Aug 9th and they require $462 at the time of the surgery because insurance won't pay that, my husband has a meet for his car club for four days out of state that will cost quite a bit, and my son's tuition for college is due. I was actually kind of grateful that he decided to start working full time and finish his associates degree one class a semester. He only needs four more classes, so this will help us immensely.

    So, my advice is to always make sure you have the money in your account to cover your charges and this is a good way to get that 5% cashback. And it makes it so much easier to balance the checkbook and keep track of what you are spending your money on.

  4. We use our credit cards all the time for much the same reason, but we do make sure we pay off the balance at the end of the month. Ours earns us discounts at a grocery store we use all the time.

    Gill in Canada

  5. Mysti, if you've developed the self-control and PF strategy mojo to charge and pay, go for it!

  6. I either use cash or pay directly from our back account. No credit, ever. "Neither a lender nor a borrower be".

  7. Sounds too confusing for me, I am afraid I would slip up and miss something.

  8. if you can do it, then go for it :) any way to earn a bit of a bonus is good in my mind!

  9. BE CAREFUL! I got over $1,000 in Discover cash back but they always win... with Citi now I still get tons of points and gift cards but at the same time I think that's what keeps me in debt :(

  10. we do this too. the only problem is when we keep spending even though we dont have enough in the bank to cover the cost right away.
    we're getting better though!