Best credit card for me?

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Booper
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Best credit card for me?

Post by Booper »

A friend recommended that I look into getting a credit credit card that give me "cash back".

About me: I generally dislike credit cards. I would prefer to not have one and just use my debit card. But I've found that you really need one in our society because (1) some businesses, such as rental car comapnies, will only accept credit and (2) the pros of establishing a high credit score outweigh my personal distate for using credit. I always pay my balance off in full.

The attraction of switching to a credit card company that "pays me back" some % of the amount that I spend on something like groceries should be self-evident. However, when I look at various offers online I find them difficult to compare. I really don't want to deal with a "point" system or pay an annual fee of any kind. I dislike the "rotating cash back" categories because it seems that then I might change my shopping patterns due to my credit cards whims, which I don't want. I just like the idea of getting some flat discount on things. Does anyone have advice on this?

Thanks.
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randomwalk
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Re: Best credit card for me?

Post by randomwalk »

enc0re
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Re: Best credit card for me?

Post by enc0re »

1. Go to http://www.fatwallet.com/forums/finance/
2. Have your mind blown.

For reference, I use a CitiForward that gives 5% on restaurants including fast food, entertainment including iTunes, and books including all of Amazon.com. It pays in ThankYou points but I can redeem them for Lands' End gift certificates. Which means all of my clothing except for suits is paid for.

I also use a BoA CashRewards that gives 3/2/1% on gas/groceries/everything for straight cash back. Just set up automatic debit from your checking to always pay the balance in full and there's no risk of paying interest.

And I'm one of the lazy ones. There's a lot of money to be made of CCs.
stupidkid
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Re: Best credit card for me?

Post by stupidkid »

Ditto on fatwallet, I've played the cc arbitrage game for some time based on what I learned there.

The best current card available in my opinion is the Priceline visa. You get 2 point/miles on every standard purchase and 5 on priceline bids. That point/mile is really 2% cashback which you can apply to your credit card bill. No annual fee, no need for a brokerage account (like the fidelity card), no rotating categories (like the chase freedom card), and it's a visa so it's accepted everywhere.

Plus, it has a picture William Shatner on it.
Topic Author
Booper
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Re: Best credit card for me?

Post by Booper »

Thanks everyone. Nerdwallet was particularly useful. I just got a amex blue cash everyday card. it was between that and the capital one card.

Just a quick question. It looks like both cards offer $100 if you spend some x dollars in the first y months. Is there anything to prevent me from closing my amex account after reaching the threshold and getting my free money, and then opening the capital one account soon after so that i can get my free money there too?
mlipps
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Re: Best credit card for me?

Post by mlipps »

Aww, it's so cute, a little FatWalleter in the making! No, there's nothing to stop you, but you wouldn't need to close the first to open the second either. Go dig around FatWallet and read about AOR's, which stands for "App o'Rama". Before the recession, people were literally making 1000's of dollars on those kinds of deals. Now they're harder to come by, but people are definitely still making a good chunk of change from it.
Topic Author
Booper
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Re: Best credit card for me?

Post by Booper »

mlipps wrote:Aww, it's so cute, a little FatWalleter in the making!
LOL! Yes, I can see how people get into this now. I hope that I don't get too into it, but say simply content to get a bonus from doing what I'm already doing. (In this case simply receiving a 1%-3% discount on items that I'd already be purchasing).

My friend told me some sick things about CCs, which I guess is what you were alluding to. People borrowing the limit of money at 0%/year, then parking the balance at a bank that would give them 5% interest, then returning the money in full but keeping the interest. Of course, deals like that require banks to pay non-trivial interest rates. But still, an interesting world to see.
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Watty
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Re: Best credit card for me?

Post by Watty »

Booper wrote:
Thanks everyone. Nerdwallet was particularly useful. I just got a amex blue cash everyday card. it was between that and the capital one card.

Just a quick question. It looks like both cards offer $100 if you spend some x dollars in the first y months. Is there anything to prevent me from closing my amex account after reaching the threshold and getting my free money, and then opening the capital one account soon after so that i can get my free money there too?

Just FYI,

I got a $150 sign up bonus for openeing a checking account last year and I got a tax form reporting that as interest so I had to pay taxes on it.

That is OK but the thing that earked me was they had some sort of problem and didn't send out the form until mid March and I had already filed my taxes by then so I had to file an ammended return Grrrrrrrr...

I don't know if you will get one for the credit card offer or not.
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jeffyscott
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Re: Best credit card for me?

Post by jeffyscott »

I have never gotten a tax form for any of the many sign-up bonuses that I have received.
centrifuge41
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Re: Best credit card for me?

Post by centrifuge41 »

Nobody gets tax forms on credit card rewards. It's considered a reduction in the basis. Some people get tax forms on bank bonuses.

If you want something simple and no-fee, maybe a Capital One cash rewards is for you. However, you'll be missing out on the fact that the biggest bonuses are for signing bonuses, not for continuous cashback from credit card use (unless you spend a whole lot). If you don't want complexity from annual fees, points, or lots of cards though, the Cash Rewards is probably your best choice for an effective 1.5% disount.
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mike143
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Re: Best credit card for me?

Post by mike143 »

I like free money so I do have a "Fatwallet", which I keep in my front pocket due to Sciatica. I carry the Amex Blue Cash Preferred which gives me 6% on grocery, which I also buy a $500 Visa gift card every two 2 weeks, which yields me 5% cash back after the $4.95 card fee. I am averaging $75 cash back each month between the two gift cards and my actual grocery purchases. Then I have the PenFed Platinum Rewards Visa that gives me 5% cash back on gas, I also use the GasBuddy smart phone app to find the cheapest gas. The I have my Fidelity Investment Rewards Amex that is 2% on everything. I just added the Priceline Visa that is 2% on everything for places that don't take Amex.

At first wrote with a Sharpie on the front of the card a reminder, such as "5% Gas or 2% All". Now that the Sharpie has worn off I know what each card is for. I use my Visa gift cards everywhere, grocery stores that don't get charge as grocery, dining out, purchasing Walmart gift cards to use at Sam's Club, bills that don't offer a discount for cash equivalents. I have no problem using them up and found that the easiest way to zero them out when a small balance remains is to to purchase a Amazon electronic gift card and redeem it myself.
Nothing is free, someone pays...You can't spend your way to financial freedom.
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jeffyscott
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Re: Best credit card for me?

Post by jeffyscott »

Rebates are nice and we do use several cards to maximize them, but sign-up bonuses far exceed what you can get from rebates. In the last year, with one new card we effectively earned a rebate of nearly 21% on $6000 in spending if we use the points for travel (and even if we just used the points for cash, it would still be over 16%). Another pair of new cards got us free flights worth about $1400, with more points to spare this for a single use of the card.

These days there apparently can be some give back on this in the form of higher insurance premiums. But when our insurance company tried to justify an increase based on insurance credit score, this just pissed me off as totally unjustified (we are a greater insurance risk because we pocketed over $3000 in cash and airfare bonuses, really?) and led me to shop for a different company and we will end up paying less.
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mike143
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Re: Best credit card for me?

Post by mike143 »

I take advantage of the occasion signing bonus. Just cancelled my Southwest/Chase card less than an hour ago that yielded me $500 in gift cards for the $69 annual fee. I use CreditKarma.com and when I apply for cards my FICO drops and when it goes back to where it was I consider a signing bonus offer.
Nothing is free, someone pays...You can't spend your way to financial freedom.
mlipps
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Re: Best credit card for me?

Post by mlipps »

centrifuge41 wrote:Nobody gets tax forms on credit card rewards. It's considered a reduction in the basis. Some people get tax forms on bank bonuses.

If you want something simple and no-fee, maybe a Capital One cash rewards is for you. However, you'll be missing out on the fact that the biggest bonuses are for signing bonuses, not for continuous cashback from credit card use (unless you spend a whole lot). If you don't want complexity from annual fees, points, or lots of cards though, the Cash Rewards is probably your best choice for an effective 1.5% disount.
Actually that's not totally true. There's details on the FatWallet forum for each separate bonus usually, but I know Citi is sending 1099's for their signup bonus.
Carl53
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Re: Best credit card for me?

Post by Carl53 »

mike143 wrote:I like free money so I do have a "Fatwallet", which I keep in my front pocket due to Sciatica. I carry the Amex Blue Cash Preferred which gives me 6% on grocery, which I also buy a $500 Visa gift card every two 2 weeks, which yields me 5% cash back after the $4.95 card fee. I am averaging $75 cash back each month between the two gift cards and my actual grocery purchases. Then I have the PenFed Platinum Rewards Visa that gives me 5% cash back on gas, I also use the GasBuddy smart phone app to find the cheapest gas. The I have my Fidelity Investment Rewards Amex that is 2% on everything. I just added the Priceline Visa that is 2% on everything for places that don't take Amex.

At first wrote with a Sharpie on the front of the card a reminder, such as "5% Gas or 2% All". Now that the Sharpie has worn off I know what each card is for. I use my Visa gift cards everywhere, grocery stores that don't get charge as grocery, dining out, purchasing Walmart gift cards to use at Sam's Club, bills that don't offer a discount for cash equivalents. I have no problem using them up and found that the easiest way to zero them out when a small balance remains is to to purchase a Amazon electronic gift card and redeem it myself.
I have done the $500 gift card via Amex Blue Cash Preferred route since I read your post of a month or two ago. Works well. I've got a couple of utilities that I can use up small amounts on as special payments. I have one utility that charges a fee to use a cc. I then used a whole gift card to pay ahead perhaps 8-10 months to minimize the fractional expense. My gift cards cost $5.95 but I do get fuel points at my grocery that are worth another 2.5-10% depending on whether their purchase is 1-4X reward if I buy 25 gal of gas at a time which I usually do with a couple of spare cans.
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mike143
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Re: Best credit card for me?

Post by mike143 »

Carl53 wrote:I have done the $500 gift card via Amex Blue Cash Preferred route since I read your post of a month or two ago. Works well. I've got a couple of utilities that I can use up small amounts on as special payments. I have one utility that charges a fee to use a cc. I then used a whole gift card to pay ahead perhaps 8-10 months to minimize the fractional expense. My gift cards cost $5.95 but I do get fuel points at my grocery that are worth another 2.5-10% depending on whether their purchase is 1-4X reward if I buy 25 gal of gas at a time which I usually do with a couple of spare cans.
Check the gift cards for the fee. For some reason some of the Vanilla Visa stylized gift cards are $5.95, the plain ones are $4.95. The grocery I purchase the gift cards from doesn't give gas points for them. I have read of some people really turning a saving between gift cards, gas credits, and extra gas cans.
Nothing is free, someone pays...You can't spend your way to financial freedom.
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papito23
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Re: Best credit card for me?

Post by papito23 »

mlipps wrote:
centrifuge41 wrote:Nobody gets tax forms on credit card rewards. It's considered a reduction in the basis. Some people get tax forms on bank bonuses.

If you want something simple and no-fee, maybe a Capital One cash rewards is for you. However, you'll be missing out on the fact that the biggest bonuses are for signing bonuses, not for continuous cashback from credit card use (unless you spend a whole lot). If you don't want complexity from annual fees, points, or lots of cards though, the Cash Rewards is probably your best choice for an effective 1.5% disount.
Actually that's not totally true. There's details on the FatWallet forum for each separate bonus usually, but I know Citi is sending 1099's for their signup bonus.
Sorry for the bump, but wanted to clear this up for future readers, as I'm sifting through this myself.

The Citi 1099s (2011 tax year) were for bank accounts (checking), not credit cards. See http://www.bogleheads.org/forum/viewtop ... =2&t=92051 for more discussion
A thing is right when it tends to preserve the integrity, stability, and beauty of the biotic community. It is wrong when it tends otherwise. -Aldo Leopold's Golden Rule of Ecology
mlipps
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Re: Best credit card for me?

Post by mlipps »

papito23 wrote:
mlipps wrote:
centrifuge41 wrote:Nobody gets tax forms on credit card rewards. It's considered a reduction in the basis. Some people get tax forms on bank bonuses.

If you want something simple and no-fee, maybe a Capital One cash rewards is for you. However, you'll be missing out on the fact that the biggest bonuses are for signing bonuses, not for continuous cashback from credit card use (unless you spend a whole lot). If you don't want complexity from annual fees, points, or lots of cards though, the Cash Rewards is probably your best choice for an effective 1.5% disount.
Actually that's not totally true. There's details on the FatWallet forum for each separate bonus usually, but I know Citi is sending 1099's for their signup bonus.
Sorry for the bump, but wanted to clear this up for future readers, as I'm sifting through this myself.

The Citi 1099s (2011 tax year) were for bank accounts (checking), not credit cards. See http://www.bogleheads.org/forum/viewtop ... =2&t=92051 for more discussion
It's been too long and I don't remember where I saw it know, but I specifically remember it because people felt the TY points were being overvalued. My understanding is that for a DIRECT signup bonus, you'll get a 1099, but something with a spending requirement (spend $2500, get $500 back etc.) will NOT trigger one.
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papito23
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Re: Best credit card for me?

Post by papito23 »

mlipps wrote:
papito23 wrote:
mlipps wrote:
centrifuge41 wrote:Nobody gets tax forms on credit card rewards. It's considered a reduction in the basis. Some people get tax forms on bank bonuses.

If you want something simple and no-fee, maybe a Capital One cash rewards is for you. However, you'll be missing out on the fact that the biggest bonuses are for signing bonuses, not for continuous cashback from credit card use (unless you spend a whole lot). If you don't want complexity from annual fees, points, or lots of cards though, the Cash Rewards is probably your best choice for an effective 1.5% disount.
Actually that's not totally true. There's details on the FatWallet forum for each separate bonus usually, but I know Citi is sending 1099's for their signup bonus.
Sorry for the bump, but wanted to clear this up for future readers, as I'm sifting through this myself.

The Citi 1099s (2011 tax year) were for bank accounts (checking), not credit cards. See http://www.bogleheads.org/forum/viewtop ... =2&t=92051 for more discussion
It's been too long and I don't remember where I saw it know, but I specifically remember it because people felt the TY points were being overvalued. My understanding is that for a DIRECT signup bonus, you'll get a 1099, but something with a spending requirement (spend $2500, get $500 back etc.) will NOT trigger one.
That sounds like a good general rule. Remember that credit card rewards are essentially never reported. I asked for some feedback, and I'm satisfied (finally): http://www.bogleheads.org/forum/viewtop ... 2&t=106827
A thing is right when it tends to preserve the integrity, stability, and beauty of the biotic community. It is wrong when it tends otherwise. -Aldo Leopold's Golden Rule of Ecology
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