One of the best comedies in the history of television was a show that was ostensibly about nothing. I am talking about Seinfeld, of course. A previous blog of mine mentioned goals, so I am thinking a weekly, national column, gazillions of readers for a decade. Why the heck not? I have studied the national population dispersement and think that the half of the nation that lives in flyover land will totally understand what is going on in my small town world, and those packed into the coasts like tons of iridium atoms can make fun of me all they want, as long as they read it!
As all seven of my readers know, I bought a new car a couple of weeks ago. Many people might not be aware that trading in our 4 wheel drive GMC Denali pickup truck for a convertible Camaro was a very logical decision. First, in this age of $4.oo per gallon gasoline, it gets superior gas mileage than either the Yukon or Denali did. And by superior I mean in-town milege went from 12 to 18, and highway mpg went from 16.5 to 20.5 mpg. Financially a plus! Second, driving the Yukon made my knees hurt and I have not had any pain while driving the Camaro. Medically a plus! Last, but certainly not least, I look good driving it and it makes me happy! Mental health bonus. Win, Win, Win!
Dave Ramsey is a financial guru that has built an empire by giving people advice on how to be good money managers. I think he has a good program for beginners. His main thrust is to get people to examine their finances, make a budget and stick to the budget using a series of envelopes for cash. I think that is great for people who are just getting starting on the road to financial freedom. There are also people who make their money go further by extensively searching for and using coupons. I would like to take that up a level and talk about a couple of credit card reward programs.
In our household, we use two credit cards to make all of our purchases, with rare exceptions for small, local retailers that I don’t want to get hit with the network charges. I would like to describe some of the benefits of this method. First, let me tell you that while banks take the security of their ATM/Debit cards seriously, there is not alot they can do about some random number generator in Russia, who is at this very moment making fake cards with numbers on it to use online. Once a fraudulent charges hit your account, you have a limited time frame to dispute them with the bank and get your money back in 10 days. So, check your balance online daily and hope you don’t get hit while on vacation and before your house note went through. (Dave Ramsey recommends something called identity theft insurance, and I second that. Sometimes that comes with a premium bank account, or you might can get a discount through your bank or regular insurance person.) Comparatively, charges on a credit card come with a grace period, you call them and let them know it’s fraud, and they take it off and you are liable only for up to $50. This is much better than wiping out your cash for 2 weeks and bouncing your house note and having a blemish on your credit report that will take an act of Congress to clear up.
Both of our cards have a “spend analyzer” that will tell you what you spent your money on last month, last year, last decade, as well as compare to the previous time frame. We like being able to look back and see where our money went, because it does seem to literally disappear. Both come with “rewards.” We get actual cash back from Discover, and last year that was at least $1,000. The GM card will allow us to “save” for a new GM vehicle. We got over $2,200 toward the purchase of our new vehicle just by using that card for purchases for several months.
Now, if you can’t pay the balance of credit cards totally off every month, then you don’t need to do it. If you are disciplined enough to only spend what’s in your budget, and pay them off, then I highly recommend the thousands of (tax free) dollars you can bring into your budget by choosing a rewards card that meets your needs.