Why You Should Put EVERYTHING On A Credit Card

[@TheBeagle1956]

I literally check my card accounts daily and pay off any balances. In the nineties I had some financial trouble and told myself “never again!”

[@scottthomas1894]

Cute dog

[@johncorbett59]

I'm one of those 20+ card types. As long as you are diligent on keeping track of what card you use for every purchase and you ensure your never paying interest, it's so worth it. I fly 3-6x times per year and I haven't paid for a flight since 2018. Learn the game and play it.

[@ErinTalksMoney]

You and Steve (my husband) would get along great! 😂

[@tacrewgirl]

Yep, same here. I have a spreadsheet.

[@mckinleyp13]

You’re 100% right, if/once you’re able to responsibly use them, there’s no reason not to put all elegible purchases on your cc.

[@Interestingenough4]

For me, my go-to card is the Fidelity Rewards card, and it's my only credit card. There are no fees, and I use its rewards to feed money into my Fidelity HSA, which often adds up to $400 or so per year and is tax protected. I just pay the balance at the beginning of every month so that I don't rack up interest. And protection-wise, there was a case where a merchant never provided some collectibles I bought, without any explanation. I was able to challenge the transaction and have the credit card company reverse the charge.

[@WeezyMcClosely]

Fidelity also allows you to deposit your rewards to a Fidelity Roth IRA if you have one. Every little bit helps!

[@mikeforest8405]

Oh wow that one sounds amazing. Thanks for the tip.

[@patrickbolmeyer9515]

My wife and I have 3 credit cards, one airline and two hotel. Now that we're retired we can travel free by air and stay at dozens of hotels free. We've been saving our points for dozens of years and now we're reaping the benefits.

[@ErinTalksMoney]

I truly think credit cards make travel so, incredibly affordable!

[@jdgolf499]

I must admit, I was late to the party for using credit cards. I had one because you had to have it to reserve a hotel, rental car, etc. The reason I started using a card for everything, was to track every expense my wife and I had, two years before retiring. We'll see stsrting next Friday how we did!!!! However, I will continue using it for everything, as they are extremely convenient!

[@josephstevens9888]

I use my credit cards as convenience cards, and never as a credit card.

[@ErinTalksMoney]

That's the best way to do it!

[@josephstevens9888]

@@ErinTalksMoney Amen!

[@traywaters1575]

It’s a good day when Erin uploads 🙌🏾

[@ErinTalksMoney]

woo-hoo!

[@DJSliick]

I got 14 Cards. I Regularly Use 4 Cards. My Fav is My Amex Gold. Pay in Full! Never pay interest ppl. Do your best. This game aint for everybody. 😊

[@Azel247]

Awesome advice! If you are responsible with a credit card (i.e. you use it like a debit card) the perks are great. I traveled to Hawaii and damaged the rental car while trying to pull over during a sudden downpour. The CC covered the entire repair bill which was more than $1k simply because I used the CC to book the rental.

[@kevinmcnally3811]

My wife and I have 4 credit cards (Amex - Delta, Citi Visa - Costco, Fidelity - Cash back, and Amazon - 5% back). We almost never use cash and we pay our cards in full every month and the benefits are great. My only caution is that it is easier to buy more stuff, that you don't really need, with cards and you might actually spend less if you used cash for everything. Sometimes my monthly credit card bills are more than I budgeted 😞

[@DavesShop]

Great advice I have been using this method for years and earn cash back that I deposit once a year to my savings account

[@CalmerThanYouAre1]

We run a one-card system, personally. Keeping it simple and easy to manage is the way to go for us. Travel cards are what give us the most value per point. Our current card is the Capital One Venture X. As soon as the one year anniversary comes around, we’ll downgrade that card to a no-fee version and move on to another travel card with a great intro offer. Probably the Chase Sapphire Reserve. Possibly AMEX platinum after that. Then we will recycle the system in my wife’s name. Easily $3K+ of travel savings per year! The cards pay for themselves with lounge access alone. The free food and drinks save $100s over the course of a year. The CC trifecta method is just too cumbersome and time consuming for us. Demanding job, kids to raise, etc. I always lean toward simple, cost effective and time efficient when it comes to personal finance.

[@brijeshkukreja7411]

I just used my 0% apr on new purchases to purchase certificate of deposits 5%apr and will be paying off card each month until the 0% ends next June. No fee on new purchases and will just make min payments until may next year and pay it off before June 1 2024

[@OTRMonk]

I love credit cards 😍

[@freeroamer9146]

Great message! You're absolutely right about cutting up credit cards if you can't overcome the temptation. No different than any other addiction in life. 👍

[@FIRE_DrNinjaTurtle]

I am staying at 0 on the credit card, but I have a Line of Credit that I am paying of because of a big IRS bill in 2022. Once I pay that off, I am debt free again. No more big IRS bills for me.

[@SteveG1337]

‘A few….*cough*….dozen’. I’m slacking, I only have an even dozen.

[@MarcPage]

The problem with the assumption is that you will spend the same amount on a credit card vs other methods. Studies have shown that psychologically that is not true. People tend to spend more on credit cards, which can easily offset the extra $500/year.

[@hogroamer260]

Dolts!

[@MeowmyandMe]

😂😂😂 imagining Dave Ramsey’s reaction to this (for the record I agree with Erin)

[@ErinTalksMoney]

Haha - oh I know he would disapprove

[@archoplites]

One of his baby steps I don't agree with...as long as you are responsible with your CCs and never carry a balance.

[@livingunashamed4869]

Yeah I use credit cards for everything that I can. I have 5 cards but only 3 that I use regularly. Citi double cash card is the standard 2% on everything love it. Citi Custom gives me 5% back on gas (would use for groceries but I shop at walmart and walmart doesn't code for groceries), and I have the freedom flex which gets me 3% back on restaurants and the rotating categories are great. Might switch from walmart to kroger just to get 5% back on groceries every month.

[@ErinTalksMoney]

I got a Lowe's card when we started some construction projects - saved me a bundle!

[@KrustyKlown]

Simple Easy Life: get a cash back card at your bank, set it to auto pay ... then pay for EVERYTHING with that card, including setting Auto Pay for utilities, cable, phones, insurance, etc. This eliminates having to waste time paying ANY bills each month. Life gets simplier, and you get cash back for it.

[@ErinTalksMoney]

100% - it just streamlines everything!

[@simplybirdie6481]

I love my Fidelity card because my 2% reward dollars go directly into my investment account

[@ErinTalksMoney]

That’s a great perk - vanguard needs that!

[@jsilverback3795]

First time I saw your dog. Awesome.

[@ErinTalksMoney]

Peanut is the best 🐶

[@TheFishdoctor1952]

@@ErinTalksMoney Just wondering, how tall are you Erin?

[@mikelarson5333]

Happy Memorial Day especially to a military family. Thank you both for your service.

[@ErinTalksMoney]

Thanks for taking the time to watch the video on a holiday - Happy Memorial Day to you too!!

[@oahuguy3918]

Totally agree with this message. Especially with a smart phone, it's so easy to zero your balance. I love Dave Ramsey, but this is where I agree with Erin!

[@ErinTalksMoney]

I’m a fan of Dave as well!

[@miragexl007]

Dave's cool...for the Basic general population, No use to me.. Pay your bills, no brainer, live within your means, no brainer .. Don't believe on his 8-50% (lol, kidding) rule for retirement.. Just because he's a billionaire that can whether a run of bad years better, etc

[@lmr691]

Yes, I use credit cards for cash back based on the multiplier for businesses, restaurants, pharmacies, grocery store! Then, card paid in full each billing period. I do like the protection offered especially for travel.

[@ErinTalksMoney]

Love it!

[@hogroamer260]

There will always be those, usually undisciplined types, that will argue you will fall behind and pay interest or you will fall into the trap of "credit creep". So many like the 4% retirement rule well, if you get 3% cash back, that's like living with a 7% income. People are too concerned with what affects their credit score, just pay on time! I don't carry a mortgage, car loan or any other. Yet my credit score is in the 830's.

[@paul_domici]

Dave Ramsey is against CC! I use them but pay off everything every month : )

[@ErinTalksMoney]

No hate on Dave, he's awesome, I just have a different opinion on credit cards! 😊

[@jamesodell3064]

@@ErinTalksMoney Ole Dave is not so wonderful. He fired a woman who got pregnant out of wedlock. Not a very Christian thing to do, fire someone when she needs all the help she can get. His advice is mediocre and self serving. He advises low cost fund but then recommends expensive advisors who give him a kickback. He does s give good advice to people who have a lot of credit card debt. My advice would be somewhat different then his, but I have no problem with what he advises. He has help a lot of people with his advice about getting out of debt. I strongly disagree with his advice about credit cards. The only time I would advise against having credit cards if if the person can't use the responsibly. He tells his listeners that they can get a mortgage without a credit score but the number of companies offering mortgages without credit scores is very limited and I would guess a lot more expensive then a mortgage gotten with a high credit score. People are much better advised to listen to your advice then Dave's.

[@hogroamer260]

Use your credit cards like no one else so you can live like no one else!

[@jeffro221]

Good info, and I do all of it. Last year I got back about $1,200 cash back, paid zero interest, and no annual fees. Interesting that the Dave Ramsey people totally poo-poo credit cards and say people should not have them because psychologically it will induce people to spend more than they would otherwise. I guess that makes sense for undisciplined people who have no impulse control. I also like the charge dispute feature credit cards have, which I have utilized a number of times, such as when an online purchase or the use of the card in a restaurant ended up with the card number being stolen and then fraudulent charges showing up. Protection offered by a debit card is wayyyy weaker.

[@hanwagu9967]

there's pretty solid research verifying Ramsey's beliefs on reward card pyschology. it does in fact get you to spend more. It's extremely profitable, so if it wasn't you wouldn't see rewards cards. Case in point, after 2010 Dodd-Frank capped interchange rates on debit cards, debit card rewards programs mostly disappeared. There are a handful of them still around, but they also come with some baggage.

[@lost40000]

I have been playing the cash back game for years. I cash them out every month and put it my high yield savings account. Its almost like free money.

[@ErinTalksMoney]

I'm glad to hear that you cash out those points! I was so shocked to learn that many people don't!

[@lost40000]

@@ErinTalksMoney I thought the same thing. Why would you even have that card if you are not going to take advantage of the rewards?

[@toddrobinson8852]

Hey...I saw your cute little dog😊

[@ErinTalksMoney]

He's the best 🐶

[@lancenickles9818]

I use my credit card for ALMOST everything (and pay it off in full, of course). A trend that started/increased during COVID, however, was for merchants to pass along the 2-4% fee for credit card use. I don't blame them, but I won't pay it. I pay cash when I see that sign. I have to wonder if the credit card companies are getting upset with the increase in merchants that do this.

[@ErinTalksMoney]

I hate when business charge extra for using the CC - I feel like they have already increased their prices. Also - I have run into merchants that charge ass much as a 5 or 6% fee - and I call them out on that, because I know that is much higher than the actual processing fee!

[@brandonblahnik6002]

Was the financial myth of leaving a little debt on your credit card every month to increase your credit score ever true? It sounds like something that might have been true many years ago but hasn't been for a long time but continues to be passed down as a 'credit hack' despite this fact.

[@ErinTalksMoney]

I actually have no idea about the history of it - but this myth needs to die!

[@SteveG1337]

It’s a bad myth. 30% of your credit score is based on credit utilization. Credit utilization is typically based on the current debt vs available credit at the time of your monthly statement generation. Most ‘credit experts’ recommend showing under 9% utilization. There still is uncertainty about 0% vs 1-8% utilization effects, but you definitely are effected negatively for showing higher utilization amounts. These effects are typically short term and are solved within a couple months as you show lower utilization.

[@hanwagu9967]

i think the myth came about, because your credit score can be impacted due to inactivity. either because the cc issuer stops reporting activity or closes your account due to inactivity.

[@IrnBruNYC]

You said "APY," but you mean "APR." APY refers to Annual Percentage Yield, which is what you get from a SAVINGS ACCOUNT. You don't "yield" anything by getting into debt. The credit card companies are the ones who "yield" interest from our unpaid balances. Financially responsible people who are not living paycheck to paycheck should put everything on a credit card. But many, many Americans are not financially responsible and/or are living paycheck to paycheck. If you do not have the discipline and the income level to avoid piling up debt, this is good advice. But let's be real, it is bad advice for lots of people.

[@Just_Stevo]

I prefer cash back.

[@alexc2265]

Me too. Reliable and makes sense for my lifestyle. Travel redemptions don’t make financial sense for me rn. *I do prefer gift card redemptions for the bonus value, though.*

[@Just_Stevo]

@@alexc2265 I use mine as a barrier to my emergency fund. I don't touch the emergency fund until all my cash back is depleted.

[@skoolie_life3261]

@@Just_Stevothat’s a great idea!!!!

[@joethecomputerguy1]

I do. Cash back over $100/month. Perks and bonuses with relationship thru BofA and ML.

[@jimd907]

Another great video Erin. Thank you. I live by this too and never use a debit card. Young people should subscribe to your channel.

[@hanwagu9967]

You are NOT saving anything by using a credit card rewards programs. That line is simply marketing. The same reward system as in gambling, drugs, and other addictions is employed in rewards credit cards. There have been a plethora of studies on this. A recent MIT study called it 'purchase cravings' to spend more. It also pointed out an interesting finding that your neural activity changes with the type of reward card, so there is a different reward response your brain gives you when using a restaurant or vacation reward cord versus a gas card. A 2019 study showed that credit card issuers doled out only $35 billion in rewards while reporting revenue of $140 billion. More than half of the $140 billion comes from reward cards. That essentially means reward card issuers have a 100% profit margin for $1 reward. Higher rewards means higher interchange fees, too. 2021 Visa and Mastercard raked in $77billion in interchange fees. So, if you think you are actually saving anything by using a rewards card, you simply are not. They are designed to get you to spend more, and you actually do spend more in terms of increased prices for goods and services due to interchange fees. Since your husband is active duty, you should check out Penfed Power Cash Visa, which gives 2% cash back on everything. People also shouldn't worry about closing credit cards. Credit cards closed in good standing are still counted toward your credit history for 10 years. So closing credit card in of itself does not lower your credit score. Your credit score could get dinged temporarily if you the credit card limit reduced your available credit significantly and raised your credit utilization higher; however, that also is temporary if you are paying in full and you are keeping credit utilization low compared to your existing credit limit. card companies are also constantly changing terms on you, like dropping rental car CDW to extended warranties. It's better to just request credit limit increase than to open a new account. The FICO study of people with 800+ scores have utilization of 6.1%.

[@RobertBeedle]

Credit cards are great for the paying for everything. I wish people wouldn't slip into debt but they are great!

[@miragexl007]

I know why you are smiling.... your husband's military... So benefits. That's the big kicker in life... Medical. And then easy smart choices with credit cards and spending and saving.. If I could do it over again.

[@roburb73]

So you're saying that 22 between me and my wife is to many? 🤣🤣 I'm heavy in Amex. I fully funded 2 IRAs this year with converted rewards through my Schwab and my other cash back cards.

[@FIRED13]

Good video. People with less income are less likely to redeem cash/rewards because they are too busy (eg. earning money to survive, doing housework, taking care of the family, etc) - they lack time to learn about these types of programs

[@itsbkinthemix]

I put everything on my credit cards. I’ve never once thought about buying more than I needed just because i didn’t have to pay for it right away. I see it the same way I see my debit card, but I know that’s not true for the majority

[@ErinTalksMoney]

Exactly! As long as you think about them that way, you are absolutely golden!

[@hogroamer260]

Same, it's a loan, who wants a bigger loan???

[@datnohi8612]

I don't understand why people are afraid of credit cards, I have several 20 +++ I hardly use them but here recently decided to transfer a portion of my mortgage to a credit card 10k to be exact, by doing this I was able to eliminate my mortgage payment, which increased my debt snowball, once I got the small balance out of the way I was able to increase the debt snowball even more, now I have turned on the 10k, the whole time I was eliminating the small credit card bills , I had turned the 10k credit card into a personal spending card and was sending my personal spending budget to that card, which eliminated my monthly credit card 💳 payment

[@frankt1720]

I have three cards, Costco for gas and store purchases. Marriott Rewards for hotel and restaurant purchases. Fidelity for everything else.

[@sandysanderson8588]

Cash is king , You always spend more with a credit card, you have to spent loads to get a small amount of cash back. What's in your wallet haha, money.

[@davidmclifton1]

Yes pay off in full, but do not pay early. Cash is paying well now - multiple % - and by paying on time, not early, you earn interest on that cash. It’s another way the credit card company is basically paying you back - that zero interest grace period can really add up to cash back in your hand in the form of interest from the bank.

[@Jcruz388]

Gonna have to agree with the Ramsey guys on this. I don't use credit cards on a daily basis. I have one that's locked in my safe but that's it. I don't play the points game, I just put money away in a different savings account called my slush fund. If I can't afford it, I'll save up till I can.

[@joemiller8029]

For 80% of Americans, having a credit card is like being an alcoholic and having beer in the fridge and a note on the fridge door saying "note to self - just drink one." In fact, we live in an era where "more is better". I prefer to pay more at the store, and tell the clerks "I don't want a discount - I'd rather pay more so you can keep your job". Consider that more is not better.

[@miragexl007]

Absolutely. two main cards. One back up. And then use cards to your advantage... Like amtrak to get points , but pay right off. Big clothing purchase and get 20 percent off, But pay right up off.. etc. Put those cards away or cut up or cancel. I don't put Heart in the whole canceling negative thing at this point.

[@EJam3241]

Is there a list of things to help us? We just got a credit card & neither of us have ever had one. I'm trying to understand everything but I just get confused.

[@skoolie_life3261]

I can see why Ramsey teaches the way he does. He’s dealing with people who got into debt, and need to learn financial responsibility. I use my amex blue cash card for everything now. The minute a charge posts, I pay it. For my bills, I pay them biweekly with Amex and send one lump sum to cover them right away. Then for my spending money, I use an online budgeting app where I track every purchase to make sure I’m not going over my allowance. I pay each charge right when it posts to Amex. This is working for me so far. I never pay interest. It’s time consuming, so this might not work for someone with a lot of transactions to track.

[@mckinleyp13]

My favorites are the Amex gold, platinum. I make money holding these cards and get a ton of perks.

[@ErinTalksMoney]

I love my amex as well - have to say my fav is the amex Delta.

[@SteveG1337]

Amex Gold is one of the best cards out there. Such great reward point accumulation!

[@joshuagharis9017]

They need to change scoring, why business credit does penalize use, personal does, also, folks say lower score is "risky" although it could be a person with higher usage who pays always, pays rent, pays bills, (not reflected on report)

[@archoplites]

I wish I could charge all my bills on my cash back CC, including my mortgage. The statement would get paid off monthly.

[@lukehanson5320]

I had to scroll WAY down in the comments section to see any mention of the Yorkee (?). Let's all use our credit cards responsibly and buy the Peanut in our own lives a treat; then sit back and let AutoPay take care of the full balance when the the bill comes due!

[@markhalstead2386]

I allow the cash back to increase into the hundreds of dollars and then buy something I want on the card and apply the cash back directly to the card as a payment. That is the best bang for the dollar by my credit card. If I get cash deposited into my account, it is not as much money as applying it to a balance. I do pay it off monthly.

[@livingontheedge8680]

Well done! The one thing you missed (or I missed you saying it) is that a credit card statement is a great tool to track expenses. My primary card is a points/cash reward card that I use for nearly every purchase while saving the rewards for those unexpected moments in life, example; just recently our riding lawn mower (60+ years old) died, so a new one was in order. Due to the fact that the price of used were priced at or near brand new models, I opted for a brand new unit @ $3000.00. I used my reward card for the purchase ( I pay the full balance each month btw), by now I have saved close to $500.00 in rewards, this will give me the equivalent of a 15% discount on the new units total price. Who would not be happy about that?

[@Aboite81]

Great point about being a tool for tracking expenses.

[@BoxOfRain]

Good point - and my Amazon card will even categorize expenses to things like Gasoline, restaurants and so forth - so you can see both where nd how you are spending over a period of time.

[@ErinTalksMoney]

Great addition!

[@noshooz21044]

I use Apple Pay tied to my Apple Card as much as I can. The 1-2% cash back is applied daily and goes straight into my Apple Savings account. And I always pay the statement balance in full when due (no interest!).

[@mjones9088]

If you use credit you will spend 25% than if you pay in cash/ debit. I prefer cash.

[@KA-NV]

How do you get your cc company to cover your broken iPhone? I have never done that type of claim.

[@johng.5]

34.2K subscribers -- Looking good! Great video, I have 2 cards, one for everyday and one for overseas travel.

[@toddaustin2198]

Uh oh! I can just see Dave Ramsey having a conniption fit over this video, Erin! 😅

[@ecuador9911]

I have an AMEX blue cash I got in 2007 that pays 5% on grocery store, gasoline and pharmacy purchases after I charge 5,000 (or maybe 6,000) after the yearly anniversary and 1% after that. No maximum category limits, no annual fee. I don’t think they offer it any more, but they still want me to “upgrade” but it seems to work well for me. Enjoy your videos.

[@ErinTalksMoney]

The Amex blue cash was my first credit card I ever had!!

[@Killer-man99]

Can bills apply to this strategy ? Such as rent/car payment?

[@miragexl007]

Gas and groceries!! 2 absolutes. Amex, despite the yearly charge.

[@trackguy4038]

I use the LLBean card since I use the rewards to send jackets to the great nieces and nephews

[@lianalonge1984]

I have a main card and 12 back up cards. 🤣 I use them all in place of cash and pay off balances while in pending status (due to OCD) when I can. 😅 And when I can’t, I immediately payoff the balance once it posts. I’m obsessed with not having to pay interest!

[@glen46823]

I try to always buy small purchases from local business with cash, so they dont have to pay the credit card fee. For purchases from big box stores or big purchases, and anything there is any risk at all I will have to dispute later if they dont provide a satisfactory product or service, I always put on credit card. As long as I pay off every month, the credit card company basically pays me to use it.

[@Take_Your_Time_I_Can_Wait]

Yep, I don’t even use debit cards at all! I use strictly credit cards and make sure I’m using the credit card with the corresponding most cash back for the respective category purchase. For anything I don’t get 3-5% cash back, I at a minimum will use my Citi Double Cash card. I don’t buy anything unless I’m getting paid to buy it lol. Plus, you don’t pay any taxes on any money earned this way because the IRS sees this money as a rebate as opposed to earnings, so that’s definitely an extra bonus!

[@ErinTalksMoney]

Great point! (I much rather prefer credit cards to debit cards - I actually don't even have a debt card - and that ended up getting me into a bit of a pickle with my bank once...whoopsie)

[@FlyBooboo347]

I don't like credit cards at all. Is it hard to manage your credit card.

[@jiangpkpful]

Also, some banks offer additional perks if you have multiple credit cards or credit cards plus bank accounts with them. Super powerful when you tap into those. Examples. Use Chase freedom/freedom unlimited (both are no annual fee cards) to rake up points, transfer those points to Chase Sapphire or Sapphire reserved card, and your points will be worth up to 50% more when redeemed for travel. Bank of America's premium reward program is another good one. When you have a combined balance of over 100k in all BoA (AND MERRILL INVESTMENT ACCOUNTS), the cash rewards in your selected category can go up to more than 5%

[@bryansproles2879]

I literally just finished paying off almost $10K in CC debt that slowly built up and most of which was there for at least the past 6-7 years. I was finally able to get everything caught up thanks to a small inheritance I had been waiting on for the last 2-3 years. I was able to pay off my CC debt, my car loan of about $18K, and *finally* have a true initial emergency fund of $5K, so I * don't* have to just reach for the card for a multi-hundred dollar charge that came out of nowhere. Now I'm much more at ease, and I only pay on credit for specific things that give cash back, like gas, groceries, eating out, etc. I also check balances once a week, and if above a certain amount, I pay them off immediately. I don't want to ever go through years of paying interest without being able to afford it again.

[@ErinTalksMoney]

I’m glad you were able to pay off the debt!! Congrats!!

[@DanTran-uv3rg]

I love the free nights that certain hotel cards give me :D

[@hownwen]

How does credit get affected if a cc sits idol for say a year? Or cancelling a credit card?

[@ErinTalksMoney]

Canceling a credit card can hurt your score - if it’s an old card it can reduce your credit history and also consider that it reduces your available credit. I’ve had cards sit idol for a LONG time. I generally get a notice after the second year or so saying if I don’t use it they will shut it off. So I make a purchase, pay it off then file it back away until I get the next notice 😊

[@hanwagu9967]

@@ErinTalksMoney credit history age doesn't actually get impacted by closing a credit card, since closed accounts still remain on your credit report for 10 years. Thus, your creidt history age remains in tact for those 10 years until they fall off. While any closed accounts will drop off after 10 years, your existing cards are growing older during those 10 years, so realistically you shouldn't have any impact on FICO score based on average card history. FICO study showed that people with 800+ FICO had average credit history age of 10.5years. Your score may be impacted if your credit utilization becomes higher because you eliminated some of your available credit; however, that shouldn't really be a big factor and should be temporary if you pay off in full. As far as cc being idol: cc companies don't have to give you warning of closing a cc due to inactivity. Seems some do some don't. I don't know why this hasn't been challenged, because closing an account sure seems like a major change to your account under the 2009 Credit Card Act, but apparently no one has challenged what is or isn't a major change to the account. so, it's best to either take the short term ding by closing or use each card once every 6 months.

[@edsexpeditions8185]

I put everything on a card, Citibank 2%. When I get the cash back, it goes to the checking account. Within minutes after it lands, I put it into a high yield savings or a mutal fund. If you use cash back as a statement credit or points, this points to more of a consumer mindset and encourages spending. Then again I don't travel, so you'll need to look at your own situation. I personally treat the cash back as money that's supposed to be invested, not spent on consumer goods.

[@ErinTalksMoney]

Nice!

[@vinnyg2619]

My wife and I have separate credit card accounts. I have a card associated with Hilton and one with a regular cash back, she has a cash back card. I have everything that I can hit my cards for the points, same with my wife. We have been able to get free airline tickets, free hotel rooms sometimes for a week at a time and if the purchase is large enough use the points to pay down the cost of the purchase so we get a discount. I use it instead of writing checks to whatever company accepts credit cards. A lot of times it's easier than using cash, go buy a cup of coffee and the cost is $ whatever + change - I just use a cad. The important thing as was said is to make sure it all gets paid off monthly, 20%+ interest is a money killer!

[@eltigre5469]

The newest dilemma is T-Mobile forcing everyone using a credit card and autopay to use a debit card or checking account. Autopay saves $5/mo per line. If you move to debit/checking, you lose cell phone protection, you lose earning points/miles AND subject yet another account to hacking. It’s VERY difficult to find a debit card with cell phone coverage. Any ideas?

[@FromG2eminor]

I just saw this the other day with T-mobile! It blew my mind! I save $40 per month on auto-pay. It's ridiculous they do that.

[@jimk7964]

There is indeed value of cc rewards, but I hate to have a cc balance for even a statement period (despite it costing nothing), so I use a debit card almost exclusively for the dopamine rush of seeing the debit occur in near real time 🙂

[@ErinTalksMoney]

Hey, that's why they call it personal finance!

[@inconnu4961]

I'm with you! I had some issues with a couple CC companies (they would decline my payment online, even though I KNEW I had the balance to cover it. I also could never talk to a representative) Once I paid them off, I closed the accounts. its been 5 years now. But before that, every major purchase was bought by cc and paid by the end of the month.

[@SteveG1337]

If you don’t like seeing a balance on your card, just pay it off each night/week/etc.

[@hogroamer260]

I'm the flip side, I hate seeing my checking account balance dwindle. I use the credit cards, pay them off each month when my retirement check comes through. I make a game of it and try to spend less than the check and build the checking balance each month.

[@JBoy340a]

We travel and use an airline credit card. Lots of free flights and upgrades over the years.

[@ErinTalksMoney]

Same here - love it!

[@Rotor0053]

930 billion in US credit card debt

[@murraypassarieu9115]

Great video. Almost all our spending is on groceries and I’m constantly looking for promo cash back rates. Right now I’m getting 5% from Chase Freedom Flex for the first year. It also has rotating bonus categories and when the category was groceries in the first quarter I was getting 9%. Rewards cards are awesome.

[@philipw4849]

I prefer cash rewards cards with quarterly promotions

[@ErinTalksMoney]

Nice!

[@richardlee5536]

I see the doggy back there!

[@drbcrb]

Saved $1500 international air fare

[@ErinTalksMoney]

Nice!

[@khc8800]

Great advice again! My CC login provides a credit score building tool that suggests not keeping too many accounts open. Maybe it comes into play only at certain score ranges.

[@ErinTalksMoney]

Mine does as well - my husband and I have a friendly competition on who can have the better score - last month I inched ahead 😊

[@inconnu4961]

@@ErinTalksMoney If you both pay it in full by the due date, how is this possible?

[@ErinTalksMoney]

We have a different number of credit cards, different credit limits and different credit histories

[@hanwagu9967]

@@inconnu4961 the score you get when you login to a cc will vary from bank to bank, because the score depends on how often your issuers report, which score is being offered, and how frequently your data is pulled. There are 20 different FICO versions, along with separate from FICO Vantage score from Transunion. depending on which score product, your credit utilization information could be pulled daily which will impact your credit score even if you pay off in full after the billing cycle ends. Moreover, if your bank reports once a month at the beginning of the month, then that is in between billing periods, then credit utilization will be included in the socre you see even though you will pay off in full.

[@dstevens518]

Can't argue with the logic, but just hate credit cards and having to keep track of them. Personal finance is personal, so as long as you're doing the major things (earn reliably, save and invest at a healthy ratio) and are on track to have options in the future, you're good.

[@ErinTalksMoney]

100%

[@hogroamer260]

Wait until you're retired and a paycheck is out of the picture. Coupons are income, cash back is income, gift cards from blood donations are income, sales and clearances are income (if you NEED what you're buying). Opening windows at night and shutting off the A/C is income (savings/income - all the same to me). Get it where you can! I do these things because I'm a numbers guy and I enjoy it, not like I need to but, perspective changes on the other side, you'll see!

[@dstevens518]

​@@hogroamer260 As I said, can't argue with the logic. While we're not retired yet, we are fortunate enough to have different problems, namely we can afford to spend more but have a hard time doing so after a lifetime of frugality.... I'd say lucky us, but I do feel we sacrificed for decades to get here.

[@hogroamer260]

@Dan Stevens Don't look at it as sacrificing, look at it as a donation to the "old Dan". Take comfort in knowing he will be so grateful you took care of him! When I was working, I was fortunate to be able to work overtime to fund nice vacations or make a large purchase/repair. ...I worked a lot of overtime! The extremes I go to in my finances are only because I enjoy doing that. I hope you enjoy and are amazed at the different perspective when you can retire. I retired at 56-1/2, that " young Dave" was awesome!!!

[@dstevens518]

@@hogroamer260Thx. Sacrifice is probably too strong a word, we always felt we were doing whatever we wanted (travel, dining out, lattes, a few toys) but we just never had tastes that outpaced our earnings/savings. Still our "problem" today, but it's gotten bigger as the spread between what we've accrued and what we need continues to grow ... So my ignoring the benefits of CC usage is my way of splurging, "spending" to make my life more enjoyable 🙂

[@keithfrasier]

I see Peanut the wonder Dog made another cameo appearance! Great video Erin. Several years ago I got into "credit card churn" for the sign up bonus. I had to use a spreadsheet to keep track of everything, but I made 17,000 in sign up dollars over a 2 year period. I finally ran out of new cards to get so I don't do it as much anymore. Now just 3 or 4 times a year if a good bonus offer comes along.

[@ErinTalksMoney]

Peanut 🥜 did grace us with his presence! What an incredible bonus amount!

[@SCPVIDEOPRODUCTION]

Ouch! I really disagree. Yes I’m Dave Ramsey educated. I noticed how much more I would spend when I used credit cards. Cash is harder to spend and I find myself putting things back. I do use credit cards I try to only use them when it’s something I have to buy or an Amazon purchase. All the perks don’t measure up when I spend extra on items I would not have bought. I would rather invested that money. Also the more people use credit cards the more people are going to accept CBDC and that is a nightmare. People need to use cash as much as possible. But I guess it won’t matter how much people use cash CBDC is still coming. I love your videos thank you for your work. Credit cards are for people that know how to use them correctly. The amount that you get back is nothing compared to a good investment. CC perks are in no way a good way to make money. They are a legal scam . “Money flows from those that can’t handle it to those that can” Dave Ramsey

[@hogroamer260]

Not my problem, I'm getting the rewards and LEAVING more in my retirement account ....I'm retired!

[@hogroamer260]

What about traditional IRA's? Maybe they are bad because it gives people the illusion that they have more money than they actually do, part of it is Uncle Sam's. Also, it's a trap for your heirs! You can't pick and choose perspective. Facts will come crashing down regardless.

[@ErinTalksMoney]

I hear what you’re saying - and I actually do agree with you, I think cash is harder to spend for most people. But i really love the protections that come with credit cards. I think if you are diligent and stick to a list or a budget, you can keep your spending on check with a credit card. However, with that said. No one ever got themselves into financial trouble by saying no to debt and ensuring that they have the money in the bank to pay for things out right. So while I may love a credit card, I get that others may not, and that’s just fine to 😊no doubt Dave Ramsey has helped thousands upon thousands of people with their finances!

[@unknownt5391]

I am on a hunt for a good reward card.

[@ErinTalksMoney]

What are your primary spend categories?

[@unknownt5391]

@@ErinTalksMoney eating out/ restaurants/groceries

[@LiamRappaport]

6:50 Only having 2 credit cards would mean (the "length of credit history" portion of) your credit score could really take a hit if you decided to open a new card or two for a signup bonus.

[@hanwagu9967]

actually, this is a myth. your credit score won't actually take a hit because of the average length of credit history by closing credit cards, if they are credit cards in good standing. The cards still remain on your credit history for 10 years and continue to be included as part of your average credit age. This means, that the active cards will continue to be on your credit history when the closed accounts drop off in 10 years. After that your credit history average won't be impacted by then because your existing cards will have more than 10 years average age by then. This is important considering a FICO study showed those with 800+ FICO had average credit age of 10.5 years. Your credit score may take a ding if by closing the credit cards your credit utilization increases because you have a lower credit limit. Even then, this is temporary especially if you pay off in full every billing cycle.

[@LiamRappaport]

@@hanwagu9967 I said if you open new cards, not close them. If you have 2 cards with an average length of 5 years and open 2 more for signup bonuses, suddenly your average length of credit history is 2.5 years. That was good info on the closed cards though, I didn't know they stayed on for so long after closing.

[@TheFishdoctor1952]

I would love to see you and Dave Ramsey on a one on one talk show, lol.

[@ErinTalksMoney]

Hahaha, well I’m a fan of Dave, so I’d like to see that as well! 😂

[@WashCounty]

Having worked with two friends who got themselves into ALL KINDS of trouble with their credit cards, this video set off a lot of alarm bells in my head. With the average person carrying almost $8,000 on their credit cards, your advice is only for those with enough self-discipline to use their cards wisely. It's too easy for most people to overspend with the buy now, pay later appeal of plastic.

[@dstevens518]

Yup. Seemingly for every five or ten responsible CC users, there's one or two that can't control themselves. Buy Visa shares, they'll always do well.

[@hogroamer260]

It's not like "comps" for gambling. That's a losing game for everyone. Credit cards aren't for financial illiterate. Most people here enjoy finances and understand the consequences of the traps.

[@roburb73]

Go Steve! 🤣🤣

[@ErinTalksMoney]

I showed him your comment! 😂 but get this - I told Steve that I felt bad for calling him out after I filmed this video. And he was like “well don’t kill me, but I got a new credit card yesterday, I didn’t tell you because I didn’t want to stress you out.” To which I said, “I don’t even feel bad anymore 😂”

[@roburb73]

@@ErinTalksMoney 🤣🤣🤣🤣🤣. My wife doesn't even concern herself with it anymore. She just gave up!

[@ErinTalksMoney]

Well that’s the attitude I’m going to have to adopt

[@jdogg402]

This video is a disservice to 98% of the viewers

[@SteveG1337]

Why do you think that?

[@hogroamer260]

It's only a diservice to those that can't handle money. Like alcohol, if you can't handle it, don't use it! I enjoy that too, on occasion, but don't abuse it.

[@ramjet5192]

Not in Ecuador. It's all US cash.

[@famicomnintendo]

your little dog is adorable :D

[@ErinTalksMoney]

That’s Peanut 🥜

[@garynovak7977]

You are so great! Erin: I check my credit card once a week and pay it off. Gary: Slacker. I do that almost daily. 😎😎 Oh, we have two credit cards. One is a backup that we don't use online ever. But it is there in case we are on the road and the main card isn't working for some reason.

[@ErinTalksMoney]

Hahaha!! You would probably catch any error before I would then! 😂