What’s In My Wallet? The Two Credit Cards I Actually Use

Over the last few weeks, several people have written to me asking about the credit cards that I actually use. I use two of them, and here’s how I use them and why.

My primary card is a cash back credit card: Citi Driver’s Edge Options Platinum Mastercard (here’s Citi’s page about the card). It gives me 6% cash back (for the first twelve months) on all supermarket, drugstore, and gas station purchases (it goes to 3% cash back after that), plus 1% back on everything else. On top of that, I earn $1 cash back for every 100 miles I drive, which I can prove with regular auto maintenance receipts – it basically winds up being $30 back every time I get an oil change, plus the 1% I save on that purchase. Over the first seven months of use, I’ve received back about 4.7% of what I’ve put onto the card.

My other card is the Chase Amazon Visa (here’s Chase’s page about the card). I use this one exclusively for Amazon purchases, which include a lot of my non-perishable goods and almost all of my entertainment expenses. I earn 3% of the purchase in store credit at Amazon, which has added up quite a bit in the last year ($125 in credit).

These two in tandem have earned about 4% in rebates since I began using them. Their rewards match my life very well (I commute and most of my card spending is at supermarkets, gas stations, and online) and thus I can really capitalize on them.

How do I keep them paid off? Each week, as part of my bill paying routine, I check the balance of both cards online and pay it off. This keeps me from ever seeing a dime in fees. This does mean, though, that I have to be very vigilant in not spending too much with the credit cards; I have to remember at all times that “future me” is going to have to pay this off, and “future me” is very, very real.

Aren’t credit cards in opposition to your “no debt” philosophy? My view is that a credit card in which you don’t carry a balance (effectively a charge card) is just a tool to make purchasing easier, and with the rebate options available, it’s a tool that actually pays you to use it. If I end up paying for this debt, it’s my own fault for not properly managing the cards. Credit cards are only dangerous if you start allowing yourself to regularly carry balances on them, and the greater the balance, the greater the danger.

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22 thoughts on “What’s In My Wallet? The Two Credit Cards I Actually Use

  1. Matt says:

    “Each week, as part of my bill paying routine, I check the balance of both cards online and pay it off.”

    Did I read that right? You don’t wait until the statement, but rather pay weekly, thus forgoing the interest you could earn on the money?

  2. Erika says:

    @Matt: Assuming you are spending anything resembling reasonable amounts each week, the amount of additional interest you would gain by leaving it in your account is trivial and will be washed away by missing your payment and having to pay interest or fees even once.

  3. I keep hearing good things about the Amazon card. Makes we want to take a serious look into it, as I’m a regular Amazon buyer.

  4. Matt says:

    @Erika: Let’s say I charge $300 per week. If I am getting 4% interest in my savings account, I will earn more than $50 in interest per year by taking advantage of the grace period. For a guy who spends his time figuring out how much a load of laundry costs down to the penny, I would think that $50 would be significant. He’s in no danger of missing a payment, so that’s a red herring.

  5. Matt says:

    I keep the money I can spend in my checking account and after I make a purchase with the credit card I transfer that amount into a High Yield savings account. How much do I make with this? I don’t know. But the average monthly credit card bill is about $600. This is going to change since my new apartment will take credit cards as a form of payment. Cha-ching! Especially if I can get my roomates to give me cash while I pay with my credit card.

  6. Jeremy says:

    You spent over $4000 last year on Amazon?

  7. s says:

    Wow.. I wish I could pay my mortgage with a credit card… That’d be a free vacation every year!

  8. j says:

    my dad paid my college tuition with a credit card.

    we flew to mexico for free :)

    and yes it was paid off immediately in cash.

  9. Tim says:

    if you buy a lot on amazon, then i’d say it is worth it. at the same time, the reward points can only be used on amazon. we have the amazon card too, because we are currently working and living overseas. we get lots of stuff on amazon and having the card has proved worthwhile for us. u get 3 points per dollar spent on amazon, but it also takes 2500 points to get a voucher. once we move back to the states, we probably will stop using the card since we won’t need to buy from them.

  10. Andrew says:

    When looking at the overview of Citibank’s credit cards, some say ‘cash back’, but this Driver’s Edge card only mentions ‘rebates’. Do you actually get these percentages as cash, or as rebates to be applied towards rewards like gift certificates?

  11. Penny says:

    We have an Alaska Airlines card which we use for literally everything except our mortgage (and it makes me sad to not get those miles). The card has a $30 yearly fee, but we’ve earned 7 full plane tickets and 2 half price tickets since we started using it 5 years ago. The $150 we’ve spent in fees doesn’t even cover the cost of one of the plane tickets.

    I’m a huge fan of using cards to get the reward and paying them off every month. (I actually pay ours off every week.)

  12. Trent says:

    The cash back on the Driver’s Edge card is in the form of a rebate on automobile expenses. Whenever you have any sort of auto work done, like an oil change, or you buy a new car, you can fill out paperwork and get a rebate on that purchase. We just got almost an entire transmission job paid for in rebates.

    Here’s what the form looks like:
    http://www.citibank.com/us/cards/gen-content/serv_form.jsp
    You just fill out that form, attach the receipt, and mail it off.

    And, yes, I spent about $4,000 on Amazon last year. I bought every single gift I gave to anyone last year (including a rather expensive gift for my parents), took care of ordering some Christmas gifts on behalf of my parents and bought quite a bit of nonperishable goods from there, too.

  13. Matt says:

    Has anybody used the Citi Upromise card? I’ve been debating between that and my AT&T Universal Card. I just had $75(about my monthly minimum payment but I of course pay more) transferred from my upromise account to my private student loan automatically. I like the idea of accumulating rewards and having it transferred automatically rather than with Thank You points where I have to request a reward.

  14. thebaglady says:

    Hey! I love the driver’s edge card too. I’m still on my first year of having the card so I am getting 6% on gas and groceries. I don’t have the Amazon card, though. I tried to apply for it but they rejected me because I had two other Chase cards. I do love my Chase Cash Plus Rewards card, it still pays 5% on gas and groceries. However, I think new applicants do not get the 5% anymore.

  15. Michel says:

    “Assuming you are spending anything resembling reasonable amounts each week, the amount of additional interest you would gain by leaving it in your account is trivial and will be washed away by missing your payment and having to pay interest or fees even once”.
    I don’t understand the logic of that.
    There’s no risk of missing a payment if you use a PDA, a notebook, Google calendar or remember the milk. Instead of this poor workaround, why not fix the real problem (being disorganized)?

  16. Sarah Hurst says:

    I’ve been reading through some of your posts, and I wanted to point out that you sound a little bit like Mad-Eye Moody: “CONSTANT VIGILANCE!” That’s from Harry Potter for those not in the know. :-) Anyway, it made me smile. Thanks for the great and practical advice!

  17. Jacob says:

    I’ve read that many of these gas/grocery rewards cards actually do not count the money spent at warehouse clubs (Sam’s and Costco) for groceries and even gas (as some do have gas pumps). What is your experience with this Trent? I know that a good chunk of my groceries are bought at Sam’s and I usually aim to get gas there as well because usually it is about .10 cents cheaper per gallon than any other place in town.

    Thanks!

  18. Josh says:

    Speaking of wallet’s, what kind do you use. I’ve used a tri-fold for ever. I’m thinking of getting a bi-fold. And how much would you pay for one? I can get a nice Coach bi-fold off ebay for $27.

  19. kitty says:

    ““Each week, as part of my bill paying routine, I check the balance of both cards online and pay it off.”
    Wouldn’t signing up for having full balance automatically deducted from checking/money morket by the due date be simpler? This way there is still no danger of paying a penny an interest, but not “discipline” or “vigilance” any hustle required (except for checking the bill for fraudalent charges). I am doing that and they deduct the full amount on the due date thereby giving me an advantage of full month interest my money earn in the bank.

  20. Kiesa says:

    Huh, and my husband thought I was the only one that paid off the credit card balance weekly :)

  21. Andrea says:

    My Visa gives me travel points so I use it that way I would a debit card and try to remember to pay off the purchases as soon as they’re made. Otherwise I do it on pay day, which is also when I pay down my lower-interest line of credit and add money to my savings account.

    Online banking is great. A few clicks and the money is transferred, often before the charge appears on my online statement. If I waited until the statement came by mail I’d have a false sense of security that I had more money in my regular account than I do and I’d have a larger sum to pay all at once. I’d rather do the transfer and see the money moved.

    Setting aside a time to do it weekly is a good idea, as I keep my receipts and scheduling might help me remember.

  22. Chris says:

    Despite the rationalizations offered for using credit cards, why in the world would you want to owe a person or company money? Sure, there are rewards…assuming you don’t get jacked by some obscure restriction. However, given that they can change the rules on a whim (meaning you have to watch them like hawks) I don’t see why it’s even worth it. I’ll pay in cash, TYVM. Never forget, credit card companies are looking for new ways to cash in on you. They may not get you today, but they’ve gotten people who also assumed they would never get hosed. They’re looking for new and creative ways to get the “freeloaders”.

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