Paying off a credit card advice

[disneysteve]

As for overdrafts, that's a simple one. Don't spend more than you have in your account and you won't ever have to worry about it.

Or set up sweep protection from your EF account.

I disagree. The proper way to avoid overdraft fees is to avoid overdrafts. Don't spend more money than you have in your account. That is a pretty basic premise of banking. Balance your checkbook regularly and keep good records so that you always know how much is in the account at any given time. Then don't spend more than that amount. Don't write a check when you know the money to cover it isn't already in the account. Don't count on a deposit clearing in time to cover the check because that might not happen.

[jpg7n16]

Fair enough. Avoidance is always better.

I personally keep my entire cash EF in my checking account. There's no way I'd ever overdraft, because I'd have to have burned through my entire EF before that would happen.

And that's just not gonna happen

[crimsonred98]

1) I don't overdraft any more, and I am not going to be in danger of overdrafting any more. I set up the credit card when I first moved out on my own and was stupid in regards to my own finances. But even then, my overdraft charges came about when I had no other choice.

2) I realize that you can pay cash for everything. But I am a full time student and I don't have thousands of dollars tucked away in investments and savings account to drop a couple thousand on a car for if I decide I need to buy one. Up until I can get myself to that point, my credit score is going to be very important.

[littleroc02us]

1)

2) I realize that you can pay cash for everything. But I am a full time student and I don't have thousands of dollars tucked away in investments and savings account to drop a couple thousand on a car for if I decide I need to buy one. Up until I can get myself to that point, my credit score is going to be very important.

That right there my friend is how people get into debt! I was a full time student once and I worked 4 ten hour days while going to school.

[crimsonred98]

That right there my friend is how people get into debt! I was a full time student once and I worked 4 ten hour days while going to school.

Except for student and auto loans I am completely out of debt once I pay off this card. But my credit score is not where I want it to be. I am not really worried about getting into debt by opening up a credit card with a $500 limit and only buying gas with it. Gas is a monthly bill that I have factored into my budget, which I will not have any problem paying off, in full, every month.

[JoshuaHeckathorn]

Except for student and auto loans I am completely out of debt once I pay off this card. But my credit score is not where I want it to be. I am not really worried about getting into debt by opening up a credit card with a $500 limit and only buying gas with it. Gas is a monthly bill that I have factored into my budget, which I will not have any problem paying off, in full, every month.

I'm an advocate of responsible credit card use, so I say get the gas card and stick to your plan. Pay it off in full and on time every month. The positive payment history you create over time will have a huge impact on your FICO scores.

[crimsonred98]

I'm an advocate of responsible credit card use, so I say get the gas card and stick to your plan. Pay it off in full and on time every month. The positive payment history you create over time will have a huge impact on your FICO scores.

Are there any "big name" cards that offer good reward programs for gas purchases? I found the American Express Blue Cash card, but what I found on it says you need "great" credit to qualify for it.

I just don't want to get a card at one specific gas station and have to tie myself to buying gas from just one place, if I don't have to.

[disneysteve]

Are there any "big name" cards that offer good reward programs for gas purchases? I found the American Express Blue Cash card, but what I found on it says you need "great" credit to qualify for it.

I just don't want to get a card at one specific gas station and have to tie myself to buying gas from just one place, if I don't have to.

I think Discover has a good gas card so check on that.

Definitely don't go for a station-specific card. What happens if you do that is you end up going to that station preferentially even if the station across the street is cheaper, which negates the value of the reward program.

[crimsonred98]

I think Discover has a good gas card so check on that.

Definitely don't go for a station-specific card. What happens if you do that is you end up going to that station preferentially even if the station across the street is cheaper, which negates the value of the reward program.

Discover open road card:

Terms:
0.00% Intro Purchase APR for 12 months (then the Purchase APR)
0.00% Intro Balance Transfer APR for 18 months (then the Purchase APR)
11.99% – 19.99% Variable Purchase APR
$0.00 Annual Fee

Rewards:
Double Cashback Bonus at any gas station and any restaurant
5% to 20% Cashback Bonus through our exclusive online shopping mall
Up to 1% Unlimited Cashback Bonus on all other purchases
Choose from Partner gift cards, merchandise, Discover gift cards, Charity, or Cash.


I am not too worried about interest rates because I will be paying the balance off in full every month.


Opinions?

[crimsonred98]

Also, what would the double cashback be? If I am reading this correctly the normal cash back is only 1%, so the double cashback on gas would only be 2%?

Seems like it might take a while to build up any rewards worth mentioning if I am only getting back $4 on $200 every month, and I doubt I would even use that much.

[LuckyRobin]

The problem I see with getting any card that isn't tied specifically to one gas station is that it won't be a gas card, it'll be a credit card. Who cares if you can get back 3% if you use it at a restaurant? You're not supposed to be using it at a restaurant. The whole point of getting a gas card is you use it only for gas, to rebuild your credit. Anything that gives you the option to use it anywhere else is not a good idea for you. The temptation would always be there. I would watch gas prices at your local gas stations and see which one is consistently lower than the others. Then apply specifically for that card. Or get a couple different gas cards (if you can) and use whichever station is cheapest that you have a card for at that time. With a bad credit score you're not going to qualify for any of the good reward cards anyway. Maybe you would after a year or two of using a gas card responsibly, but not right now.

[crimsonred98]

The problem I see with getting any card that isn't tied specifically to one gas station is that it won't be a gas card, it'll be a credit card. Who cares if you can get back 3% if you use it at a restaurant? You're not supposed to be using it at a restaurant. The whole point of getting a gas card is you use it only for gas, to rebuild your credit. Anything that gives you the option to use it anywhere else is not a good idea for you. The temptation would always be there. I would watch gas prices at your local gas stations and see which one is consistently lower than the others. Then apply specifically for that card. Or get a couple different gas cards (if you can) and use whichever station is cheapest that you have a card for at that time. With a bad credit score you're not going to qualify for any of the good reward cards anyway. Maybe you would after a year or two of using a gas card responsibly, but not right now.

My bad spending habits that I used to have are not a problem any more. I am extremely frugal. I could open up a credit card with a $5000 limit and use it only for gas and I would not have a temptation to use it on anything else.

I have learned my lessons about treating a credit card like free money and I will not make that mistake again.

[LuckyRobin]

Well, it's good that you are over that temptation, but if your credit score is low you still probably will not qualify for the good reward cards and if you do, you'll likely have to pay an annual fee. If you think you would get back more than the fee is worth and you are sure you wouldn't carry a monthly balance, then it would be a good way to go.

[JoshuaHeckathorn]

Are there any "big name" cards that offer good reward programs for gas purchases? I found the American Express Blue Cash card, but what I found on it says you need "great" credit to qualify for it.

I just don't want to get a card at one specific gas station and have to tie myself to buying gas from just one place, if I don't have to.

What are your FICO scores? They'll need to at least be in the 700s to have a chance at getting approved for the Discover card you're referencing or one of the other cash back rewards credit cards.