Graduated Learning: Life after College

I got my degree, I got a job…now what?

Do you chase credit card rewards? June 12, 2011

Filed under: Personal Finance — Stephanie @ 8:45 pm
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I got my first credit card after I graduated college.  Applied for some that my bank offered, and got two, a Visa and an American Express.  I only applied for cards with cashback or other rewards that could be translated into money back.  Later I applied for the Chase Freedom credit card when I got an offer that came with a  $100 bonus.  I think I also signed up again to get a $50 bonus, but soon cancelled that account when I realized how stupid it was to have two identical credit cards.

I also have signed up for store credit cards.  I know, those are the ones that personal finance people tell you to stay away from.  You’re usually tempted at the checkout by the inciting 15% off your purchases.  Which only benefits you if you pay off the credit card.  Otherwise, those few dollars you saved are erased by the ridiculous interest rates that most store cards have.  My store cards that I have (for the top 3 stores I shop at) all have interest rates above 20%.  Of course, if you pay the cards off every month, the cards do tend to have decent benefits (sales, extra coupons, or “cashback” in the form of coupons off future purchases based on how much you’ve spent).

I’ve never signed up for a train or airlines card; I don’t stick to one airline, and don’t fly very often (except apparently this year).

I read a lot of articles on Free Money Finance explaining how to take advantage of the different rewards programs that credit card companies offer.  FMF is very adamant about using cashback cards to your advantage.  Some cards give higher rewards than others, and some will reward certain categories of expenses.  I don’t think I come out with as much rewards money as FMF does…I don’t spend nearly as much.

My theory on the matter is that your technique to maximize rewards shouldn’t be too insane.  What do I do?

*Most of my day-to-day transactions are put on my credit card.  As I’ve mentioned before, I’m all about the points.  I guess I feel a little more free to spend money if I’m getting 1% off…not really the best mental game to be playing.  I do spend cash when I go out to eat with friends if it makes the paying of the bill easier.  And most cabs don’t take credit.  But I just don’t like keeping a lot of cash on me.  Plus using credit makes keeping track of my expenses a lot easier.

*When I shop at stores I have store cards for (Kohl’s, Gap, and LOFT), I’ll use them.  You are sometimes required to use those cards to get discounts, plus I can earn future spending money or added benefits by using my cards.

*I use my Chase Freedom card almost exclusively (except for at those stores I mentioned above).  It has rewards that are simple to understand, and tend to have bonus categories that I actually use.

*Every once in a while, I’ll get an offer from my bank telling me I’ll get bonus points for using their card for specific purchases.  If those categories aren’t currently the bonus categories on the Chase Freedom card, I’ll go ahead and use those cards to take advantage of the bonus points.  But those offers only come every once in a while (when I haven’t used my card in a while!)

*I recently had to buy a bunch of plane tickets for the two weddings I’m attending this year, as well as for a family reunion.  I’ve found that if you go through your credit card’s shopping site/rewards site, you can earn additional “points”.  For my Chase Freedom card, I went through their Ultimate Rewards program.   It’s like following an affiliate link; they know you came from their site, and then will reward you with additional points, either a flat amount or a certain percentage of your purchase.  So when I discovered that going directly through JetBlue‘s website or through a flight search site (like Travelocity) would cost me the same, I chose to go through Travelocity through the Ultimate Rewards site, and will be getting additional cashback for doing so.  Easy Peasy.

There are similar programs if you have a card that is part of the WorldPoints program.  You can shop through their WorldPointsMall.  If you have a Bank of America credit card, you can shop through their Add It Up program.

To be honest, since I don’t buy a lot of things online, I’ve only ever used these sites for buying plane tickets.  And maybe once when I ordered flowers for my mom.

As a note, I’m not getting paid or any other benefits for reviewing this.  Just going over what I do.

So, how intense is your credit card rewards optimization?  Do you juggle lots of cards, each for a specific purchase, to maximize your rewards returns?  Do you find any of this worth the time and effort?  Do you use other card types?


Shopping will be my undoing July 6, 2010

Filed under: Personal Finance — Stephanie @ 9:02 pm
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To be honest, I never really considered myself a “shopaholic” (what, am I addicted to shopahol?)  I hate going clothes shopping by myself.  I require others to tell me that a dress or top looks good, otherwise I wont buy them.  I can buy jeans and dress pants on my own, but still hate doing it.  And don’t get me started on bathing suit and bra shopping.  Not fun!

So, I don’t tend to go shopping too often.  I’ll only go to the store if I’ve got a “need” for something (new dress, new pair of dress pants, etc.), and usually try to take advantage of extra sales or coupons available.  I’ve gone shopping with my younger sister (and my younger sister + mom), and also often times go out with my good friend Melissa, who has a keen eye for fashion and what works on someone.  So she and I have gone to the outlets on sale weekends to update my wardrobe.  But on those weekends I end up spending $300 or more.

So, I don’t go shopping a lot, but when I do, I tend to go nuts.  Especially if I’m using my credit card.  I’d probably spend a lot less if I bought clothes with cash because a) it’s more painful to actually see your money go away, b) I wouldn’t want to bring too much cash with me when I’m out and about, and c) I like it better if I’m getting rewards (either from store cards or my rewards credit card).

My other shopping weakness is gifts.  While I know that cost of a gift is not representative of your love for or friendship with the receiver, I feel the need to buy the right gifts.  I’ve recently been a slacker when it comes to Birthday gifts (and some wedding gifts) and end up sending them late, but even then, I buy a lot.  Probably I spend even more because I feel a little guilty for sending gifts late.  I am a lot more likely to spend money on gifts for other people than on things I want for myself.  I rationalize spending on others readily.

The good news is that I tend not to get gifts for people unless there’s an associated event.  So, some months I spend a lot less (no birthdays/holidays).  Though I have bought things “just because”…so I should watch out for that.

Overall, I don’t spend a lot of money.  But excluding my necessary expenses (i.e. rent, utilities, loan payments, gas), my gift expenses tend to add up.

Do you have a shopping problem?  Do you store up your shopping until you can do it all at once, or do you buy the occasional item when necessary?  Any tips on reducing spending?


Is the use of credit cards socially responsible? January 31, 2010

Filed under: Personal Finance — Stephanie @ 4:42 pm
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There are times at work when I spend hours in the lab.  These are perfect times to listen to my iPod.  And so I’ve been catching up on some old podcasts.  And like the nerd that I am, I listen to quite a few finance podcasts.  I’ve been going back and listening to my backlog of Marketplace Money, a personal finance podcast from American Public Media.  Anyway, they talk about credit cards quite a bit, and how different people use them.  Many people have chosen to go the Dave Ramsey route and go debt free, including not using credit cards.  Some use credit cards, but pay them off every statement.  Others carry a balance, and, in the most severe cases, have had to go to Debtors Anonymous or through credit counseling to dig themselves out of massive amounts of debt.

At any rate, they got me thinking about the use of credit cards.  In this discussion, they laud the benefits of using a debit card, since it is much more difficult to go into debt, as you can’t spend more than you have (ignoring overdraft fees/protection).  But they also point out that there are some benefits to using credit cards, or even selecting the credit option when performing a debit card transaction, as credit cards provide more financial protection against theft/loss.  And they do also sometimes offer other benefits, like an extended warranty on the purchased items.  They also discussed the differences between the two in a much earlier show.

During this discussion about the differences between using credit cards/selecting credit when you swipe your debit card, vs. selecting PIN/debit, I recalled hearing that different transaction fees are levied on the seller depending on what option you select.  And here’s the thing:  These fees really add up.  Another marketplace story discussed how many merchants are loath to accept credit cards for purchases.  The fees they must pay eat into their very thin profit margins in many cases.  I’ll agree (and the article also mentions) that sometimes companies would lose business if they didn’t accept credit cards/debit cards, since some people might not have enough cash on hand for their purchase.  But I think I’m like many people in the personal finance world (and the teacher interviewed here) that will basically use credit for every purchase possible.  It’s all about the points.  (Which always makes me think of this clip from Home Movies).  We figure if we’re spending money, we might as well get something from it.  Whether it’s for cash back, airline miles, or donations to a charity, it seems that our money is better spent if we’re getting something extra out of the deal.  For smaller purchases, I still use my credit card for that very reason, even if I have cash on me.

So, while people often chose to use credit even when they have other options, it’s costing the vendor money.  This extra cost will either hurt the vendor directly by eating up their profits, or hurt the consumers (i.e. us!) if the extra expenses are passed on to the customer.  And it seems that this problem affects some more than others.  The employees/owners are hurt by a decreased income, and/or the higher prices will make it harder for the least fortunate to afford the goods they need.

So, here’s the thing.  If transaction fees were eliminated, I’d be super keen on using credit for even the small purchases.  And if none of my credit cards came with rewards, I’d be more likely to use cash.  But I honestly don’t know if I’d be willing to give up using my credit card for everyday small purchases.  Does that make me a bad person?  I want to earn those points, and be able to easily track purchases online.

How do you feel about this?  I mean, I think most of us would agree that credit card companies make quite a bit of money even without imposing hefty fees on each purchase.  But I don’t know if anything will change.


Credit Card Trickiness May 19, 2009

Filed under: Personal Finance — Stephanie @ 9:00 am

There’s been a bit of a hubub on the internets regarding the new changes to the Chase Freedom credit card.  The changes, which Chase claims are “benefits”, are really just them cutting back on how much cash-back you can get.  The “improvements” are now that your rewards points don’t expire (apparently they used to), the bonus categories for everyday spending are being eliminated, and being replaced by quarterly bonus categories (likely not the ones you spend the most in), and they are eliminating the bonus $50 that you get when you redeem $200.  Those all sound like downgrades to me.

Some of those changes make the card seem more like the Discover cards, which have revolving bonus categories, though these bonus categories provide a 5% cashback rather than the 3% from Chase.  Then again, many places don’t accept Discover.  So I don’t know if it would be in my best interest to get a Discover card.

In general, I’m pretty much convinced I don’t need any more credit cards.  I got a few after I graduated college to start building my credit.  I got an offer or two for the Chase Freedom card, and accepted it (both for the better rewards program and a nice $100 bonus).  I have a few store credit cards as well. (I know, everyone says they’re the worst thing to have, but I have them for the two stores I shop the most in)

I really would like to cancel one of my earlier cards, which I’m guessing I could do without hurting my credit too much (since both of my first cards were started around the same time).    I just want to eliminate unused cards, but keep my history.

The other thing I’ve thought about is how the cashback from different credit cards probably doesn’t matter that much.  I’ve read about a lot of different people who try very hard to maximize their cashback.  They’ve got multiple cards that they use for different categories.  I suppose that I could start using a card that gets me higher cashback for my most common purchases (groceries, gas, restaurants).

In the end though, does it really matter?  I still pay some bills by online transfer (rather than by credit card), so I’m not chasing after every dollar of cashback money.  Looking back, I don’t spend so much on credit.  If we want to get crazy, we could pretend that I spend $6000 on my credit card every year.  I think that number is way too high, but that’s going on a $500/month assumption.  With a 5% cashback, I’d get $300 back.  While that’s not chump change, it’s not a ton of money.  So going through the hassle of figuring out which card to use at what merchants really doesn’t seem worth it.

I’ll still continue to use credit cards for most of my expenses for the minute amount of cashback I get, and to help me track my expenses.  I know that sometimes I’ll spend more having cash than credit (special thanks to my company dining program now accepting credit cards), but for the most part, my usual purchases aren’t that high (groceries) or are really out of my control, spendingwise (gas…I’m stuck putting gas in my car at whatever price is out there).  I think I’m going to go back to paying cash for lunch at work (or get better at bringing lunch), since I think I’ll be more likely to spend less seeing the money actually leaving my wallet.

How many credit cards do you have?  Do you strive to earn as many points/miles/dollars as possible?  Or do you just see the points etc. as a nice bonus for using a card you’d use anyway?  Do you find yourself spending more when you’re using your credit card?


Paying bills with credit cards? Checking out Costco, too. October 25, 2007

Filed under: Personal Finance — Stephanie @ 9:32 pm
Tags: , ,

Before you worry that I’m struggling to get by and paying for everything on credit, let me tell you that this is just a thought about earning points. I recently thought about this idea again because one of my credit card companies sent me a letter telling me that they’ll give me a $10 credit if I pay for utilities or other similar bills with their credit card. Which got me thinking…should I pay my bills with my credit card? I earn points on all the money I spend, and I pay of my credit card bill every month. I think the only thing stopping me is the knowledge that I’d have to change what I’m doing right now. Which really isn’t a very good reason not to switch. Is it worth it to pay for everything with credit cards to earn the extra points? And maybe I should get a cashback credit card, so I’ll get actual money back, instead of points that could add up to some money back….I know why the credit cards want me to do this…they figure if I mess up somewhere, they can gouge me for a lot more than that $10 they would give me.

Thoughts on this? Should I be chasing these rates, points, everything?

I also shopped at Costco the other day with one of my friends (she’s got a membership). I’d been there once or twice before (one of my roommates and I went there on tax-free day to buy mattresses) and I think that store could very easily make you spend way too much money. I can definitely see the use of the store for small businesses (restaurants, daycare centers, etc.). I do think I was tempted quite a bit. And had I not gone there, I would probably not have spent money that day…but I came out of there having spent around $80! I bought laundry detergent, dishwasher detergent, dryer sheets, compact fluorescent bulbs (10 bulbs for $4), a carbon monoxide detector (how did we not have one? I knew we needed one after I got panicky about our furnace). I think all of these items were things that we need (in our apartment of 4 people) and since we all share each other’s supplies like those (detergents, etc.) and I hadn’t bought them in a while, I figured it was my turn. I think this made me wish that we split things evenly on those sorts of things, since I definintely bought a lot of stuff! Oh, and I sucummbed to a display of microplush blankets. They were so soft, I couldn’t resist! So that was my one personal splurge. It definitely helped to shop with someone, bounce off the items as necessary or not necessary, good deals or not good deals. I prevented her from buying what was really overpriced deoderant; they were 3 to a pack for a $9 pack. You can usually get deoderant for less than $3 a piece! So, that was lucky. I may have overspent by a few dollars…I think the laundry detergent might have been cheaper at Target (where we went next), and we will probably not need to buy more dryer sheets for the remainder of our lease, but you live, you learn!

Bought just a $6 full-length mirror at Target, since I’ve been meaning to buy one for a while.  It seems that yet again I save up my spending until all at once.

Still trying to figure out what sort of blog this will become…


Calling credit card companies actually works! October 10, 2007

Filed under: Personal Finance — Stephanie @ 11:46 am
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[originally posted Friday, July 13, 2007 10:06 PM]

So, after reading a post at about mistakes he made after his financial meltdown, I decided to respond to one of his “mistakes” (Number 7, “Not asking for credit card rate reduction right off the bat) and ask how to go about doing this.  Mapgirl responded, telling me I just need to ask if there is any way for them to lower my rate.  (also check out a article about it)  So I did it…and it worked!  I called the customer service phone number on the back of the card, and at first all the phone system let me do was listen to my account balance.  I hung up and tried again…I had to play dumb and not enter any of my account information, and eventually, after a bit of a delay after the “last” option, there was another option to talk to customer service.  I told them I wanted a rate decrease, and they told me I was eligible, I just had to be transferred to someone else.  I talked to the other person, who gave me a lower rate!  While it’s not great (21+% to 15.9%), it still changed, and they said that in 3 months, I can call back for another rate decrease!  So that’s pretty cool.  Granted, I try not to carry a balance, but it gives me a piece of mind knowing that if I mess up, I’ll have a lot less interest to deal with.  They did mention that if I do mess up (go over my credit limit or miss a payment) my rate will skyrocket to 30+%…so I have to be careful…
In other news, I’ve been reading a heck of a lot more blogs than that (thanks to the magic of RSS!), and I came across BostonGal‘s post about the Pudding Calculator.  Basically, it helps you see how you’re doing in your retirement funds.  As of right now, my score is 69…not great, since the benchmark is 100, but I know that I’m still putting money in my Roth IRA and my 401(k), and I’ll be putting more in once my student loans are paid off.
So, anyway, this I guess is me linking to other people’s blogs…let me know if that bothers you, or if you like it, or whatever is on your mind!


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