Temptation: would you get a credit card justto get the juicy discount?

[Radiance]

I havent used my credit cards (I have 2) in over a year
I want to make a purchase in Amazon and they offer $40 off if I get their visa card...
hmmmm, would you do it?

[KaleighMaeA]

Negative. First off all it hits your credit report as an inquiry, and second of all it makes the average life of your accounts go down... and significantly since you only have two others which will negatively impact your credit score (even more so than the first thing)

[GREENBACK]

As long as their are no little sneaky hidden fees there somewhere I would. I don't know if you have any credit score concerns(could ding you a little depending on your situation)but otherwise, it's 40 bucks for free.

[Radiance]

Well, im ambivalent, my credit score is a mute point since I dont use credit
But they are exceptions like now that I am renting a new place, they ran my credit, and I do want to buy a house in 5 years.
now I dotn want the hassle of managing the card. as much as I dont use my visa or amex, I do monitore the account monthly

[MonkeyMama]

Yes, I would do it.

If your score is consistently high, these things don't amount to a hill of beans as far as your credit.

If you are working on raising your credit score, or can't control yourself with a credit card, don't do it.

That's the simple answer.

[Joan.of.the.Arch]

Yep, I'd do it. I did get an Amazon card when I wanted to buy something and they offered $30 if I took out a card. Sounds like the deal you are looking at is better.

[KiwiJo09]

I'm always thinking about getting the Amazon card. You can get cash rewards on it and everyone I've spoken to who has it loves it.

[disneysteve]

If I did this every time there was an appealing offer, I'd have a drawer full of store credit cards. Yes, you can save a few bucks with a new card but it means having one more card. Yes, you could turn around and close the account as soon as you pay for that purchase, but that's a pain in my book. When I was younger and $20 or $30 or $40 seemed like a more significant amount, I'd play those games, and I did. Now, though, the hassle factor would prevent me from doing that.

[marvholly]

I have done this exactly twice in >30 years.

2003-Kohl's to get a 10% discount on that day's purchase. long term benefit is the monthly discount coupons mailed to me.

6 (?) months ago got the Target card. I buy very little there as they are not real convient. However, 5% is 5% on all but Rx. Did use to get my Dad some sweat pants. Currently paying for my stuff w/gift cards from an Rx and the freezer stock up deal.

[MonkeyMama]

I think we average a new credit card once every 4 months for some reward or other. WE just call and close the cards when we are done - takes a couple of minutes. (I don't like spending a lot of time to save a few bucks - but this is EASY money).

We've often saved $100 here and there doing this.

I actually got $250 in rewards for opening an American Express card for one month last year.

Every time we buy an appliance at Sears we open a card for the discount. Is once every 5 years or so - so we just re-apply every time.

[khosta]

I would do it! And then if you don't want the card just cancel... I had a roommate in college that did this. She would apply for the card for the discount or deal and then cancel the next day. I have no idea if this effects your crdit score or what it does - but she still has great credit!

[littleroc02us]

Back when I was young and dumb I would have, but now when I'm a bit more educated in finances, Never!

[JanelleMom]

I agree with those who say do it and then cancel, as long as your credit can take it.

[littleroc02us]

No one that is wealthy would say that got rich off of rewards.

[disneysteve]

Originally Posted by littleroc02us

No one that is wealthy would say that got rich off of rewards.

Thank you, Dave Ramsey.

Yes, you won't get rich this way, but you won't get rich clipping coupons either and I don't see anyone saying that isn't worth doing. If it is worth clipping a coupon to save 50 cents, why isn't it worth taking a credit card to save $50?

I'm sure there are situations where I would consider doing the store card for the discount. I just have a higher threshold than I used to. I wouldn't do it to save $3 on a $30 pair of pants but I might do it to save $100 on a $1,000 TV. I would open the card, make the charge and pay it off in full the very first month, then close the card.

I see nothing wrong with beating the credit card companies at their own game.

[MonkeyMama]

Originally Posted by littleroc02us

No one that is wealthy would say that got rich off of rewards.

Hmmm, I don't think anyone said they get rich off rewards.

Personally, I find these type rewards pretty lucrative though. Thousands of dollars over the years. Last year alone I might have made $1k in credit rewards.

That said, I don't have credit self control issues. IF you can't control yourself with a credit card, or bother to read the fine print, it's not worthwhile. I think we can all agree with that.

[littleroc02us]

Originally Posted by disneysteve

Thank you, Dave Ramsey.

Yes, you won't get rich this way, but you won't get rich clipping coupons either and I don't see anyone saying that isn't worth doing. If it is worth clipping a coupon to save 50 cents, why isn't it worth taking a credit card to save $50?

I know, I preach the man someday's don't I.

Steve you know what my answer to that will be? clipping coupons and buying things with cash has no risk, but taking out a credit card and borrowing upon it is risky. The usual addition to that would be you could lose your job, pay the bill late and get a fee, you could run up your balance to high, etc.....

[disneysteve]

Originally Posted by littleroc02us

Steve you know what my answer to that will be? clipping coupons and buying things with cash has no risk, but taking out a credit card and borrowing upon it is risky. The usual addition to that would be you could lose your job, pay the bill late and get a fee, you could run up your balance to high, etc.....

And here is where I disagree with Dave. His advice is very good and appropriate for many, many people, but it isn't appropriate for everyone.

I have a portfolio worth nearly half a million dollars and my only debt is a mortgage for about 80K. I'm not DR's typical listener. Right now, I probably have somewhere in the neighborhood of $10,000 in my checking account. Let's say I am heading to Best Buy tonight to buy a new LCD TV for $1,500. I have the money sitting in my account ready to spend. When I get to the store, though, they offer me a 10% discount for opening a Best Buy card. So I can pay $1,500 cash or take the card and only pay $1,350. Either way, the purchase will be paid for in full within 30 days no matter what happens. I could mail in a check tomorrow. Even if both of us lost our jobs tomorrow, I would still be able to pay for the purchase in full and on time. I fail to see any risk in that scenario. Of course, I'd then close the card, destroy it and never deal with it again.

[littleroc02us]

Originally Posted by disneysteve

And here is where I disagree with Dave. His advice is very good and appropriate for many, many people, but it isn't appropriate for everyone.

I have a portfolio worth nearly half a million dollars and my only debt is a mortgage for about 80K. I'm not DR's typical listener. Right now, I probably have somewhere in the neighborhood of $10,000 in my checking account. Let's say I am heading to Best Buy tonight to buy a new LCD TV for $1,500. I have the money sitting in my account ready to spend. When I get to the store, though, they offer me a 10% discount for opening a Best Buy card. So I can pay $1,500 cash or take the card and only pay $1,350. Either way, the purchase will be paid for in full within 30 days no matter what happens. I could mail in a check tomorrow. Even if both of us lost our jobs tomorrow, I would still be able to pay for the purchase in full and on time. I fail to see any risk in that scenario. Of course, I'd then close the card, destroy it and never deal with it again.

Why are you only comparing the situation to someone is doing very well???? These statistics aren't the average situation for most people, so are you saying that this is the average american? No way, according to the MSRS 87% of retiree's from the U of M don't have over 100k in retirement at age 65. Your talking about someone that is well to do, not a person who is living paycheck to paycheck. Those are a big majority of David Ramsey callers. So for the average person, paying cash and clipping coupons is always less risky then borrowing money from a credit card. That is a fact!

[disneysteve]

Originally Posted by littleroc02us

Why are you only comparing the situation to someone is doing very well???? These statistics aren't the average situation for most people, so are you saying that this is the average american? No way, according to the MSRS 87% of retiree's from the U of M don't have over 100k in retirement at age 65. Your talking about someone that is well to do, not a person who is living paycheck to paycheck. Those are a big majority of David Ramsey callers. So for the average person, paying cash and clipping coupons is always less risky then borrowing money from a credit card. That is a fact!

I agree. I am not the typical American at all - didn't mean to imply otherwise. I'm weird, to use DR's term. Normal is broke. (See, I can channel DR, too. )

I was just trying to make the point that while Dave's advice is generally sound, it doesn't apply to 100% of people. So when giving advice here, you need to keep in mind that some of the posters, like myself, are among that group for whom Dave's advice doesn't always apply.

If the person asking the original question was a typical DR caller, my response would certainly be different and I'd tell them no way in hell should they take out a credit card just to get a discount.