Thursday, February 25, 2010

Making credit cards work for me!

For too many years, I had to work for the credit card companies. I was paying the minimum monthly payment and giving the credit cards way too much of my money/interest.

After learning to be extremely tight and frugal and becoming focused on paying off those credit card debts, we are finally at a point where we make the credit cards work for us! Every time we make a purchase big or small, we use a particular credit card. Even if I run into McDonalds or the post office, I pay with my credit card.

But even my 5 year old knows the next step. She will often remind me as we're in the car after making a purchase that I have to go home and pay it off. That's the key. I always pay off the purchase immediately.

By using the card frequently, we earn points. Then we are able to trade our reward points for cash or a gift card and use them to buy something else we need to buy. That gives us more points toward the next gift card/cash and we keep the cycle going.

***Word of caution: If we can't afford to pay the purchase off immediately, we don't make the purhase. Some people can't use credit cards because they forget to pay it off or are unable to do so. For those situations, please disregard this post! This is not a moneymaker if you are paying interest.

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