You could answer a question with a question.. anything from “Is there a reason for your question?” to “what do you take out your money for??”
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Think I’ll tell them it’s for a Brazilian bikini wax, with a straight face, and see what they say.
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You can get your Medicare number before getting the card. The trick is where to look. On “My social security”, go to the benefit verification letter.
There is also a trick to get a replacement card. It still just says “A. 
I already know my number. I need confirmation that B has been approved. But thanks.
Interesting @CFP. I guess the higher phase-out limit might mean that I get a benefit from the higher SALT cap. We’ll see.
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I have been asked about money purposes (by bankers) and I just say, “do I have to answer that? it’s personal”. For all I know they assume naughty things, but I don’t feel like telling them even though it’s completely anodyne (e.g. pay the music tutor).
Regarding cash, I heard a very stupid piece on the radio about “no buy July” - which in the first case, is kind of a ridiculous goal. What if you need something? You don’t buy milk for a month? Your kid is starting college but you don’t buy textbooks? WTH. But also, she recommended using all cash which is leaving money (rewards, points) on the table in a big way.
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I think it is hard for responsible money managers to understand that there are many, many people who aren’t responsible with their money. And rewards/points aren’t “free money” if you carry a balance on your credit card (any balance will wipe the value of points off quicker than most realize). If you’re paying 26% interest on a balance, getting 2%, or even 5% cash back is losing.
There have been lots of studies that show people spend less when they use cash, or conversely spend more when using a credit card. I believe that is the impetus behind pushing people struggling to manage their money to go back to purchasing with cash. When the cash is gone, so is your ability to spend is an easier heuristic than “check your credit card balance daily, and if you find you’re spending more than you planned cut back and check that by checking your credit card balance daily”.
No buy months (or even a whole year) aren’t a new concept. The point isn’t to “not buy milk” or “no school textbooks”, it is to figure out what expenses are necessary and to only buy those items for the set time period. So, no buying junk food when grocery shopping might be the goal, or don’t go crazy in the back to school section at the local big box store - just get the stuff needed, not the impulse purchases.
Some people do a “No eating out month”, or a “No buying new clothes month” or a “No buying toiletries until your current ones run out/expire month”. It is also a quick and easy way to figure out if those items are what is throwing your money out of whack.
If those issues aren’t one a person struggles with (credit card debt, impulse purchasing, etc), it might sound “stupid” that someone who is struggling would find those suggestions helpful.
Personally, I always appreciate it when financial advice points out that credit card rewards are a total suckers game to anyone who can’t pay off their bill in full every month, or for those who can’t spend relatively large amount on the credit cards in general. I also appreciate the normalization of spending cash as a tool to help getting spending under control. It is a good visual and tactile reminder of spending in ways that credit and debit cards don’t give.
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When our first child was born, I did not return to work. I made decent money, and suddenly that income was gone. I am excellent with money, but this was uncharted territory - H & I had never struggled financially, co-op’ing through college & great jobs right out of school. When I stopped working, we each got a set amount of cash every two weeks, and we had to make it last. Anything outside of our necessary bills (mortgage, insurance, utilities) had to come from that cash. Groceries, gas, personal items. It really helped us keep our expenses to a minimum. It might seem silly, but it actually can work.
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OK, I understand that for someone starting out, or someone with poor impulse control, these ways of gamifying money could work. I still say that it’s better in the long term to educate people so we don’t get yet another haves/have-nots where people like those in this conversation are saving and getting their points/miles/cash back and paying things off and keeping track of purchases, and those who were told “use cash” are just losing out on that source of wealth as well.
Also, I have seen different results about credit cards vs. cash. Yes, in person at stores, people seem to spend less with cash. However, when shopping online, it’s not so clear that people buy more on impulse, because they’re not walking through store aisles. I think I saw this about grocery shopping. (AI might suggest that I’d like to buy something else, but it’s usually not something as “tempting” as walking around the store might be with its good bakery smells or whatever.)
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Among persons owning credit cards, roughly half of persons in surveys say they the use credit cards to finance purchases, with revolving credit card debt, rather than paying off the card each month. Obviously 2% cashback is negated by 15-30% interest payments. Middle income persons have the highest rate of revolving credit card debt. Lower and higher income persons are both more likely to report paying off credit cards in surveys, than middle income persons.
My issue is more with the magnitude of cashback being small in relation to other income sources. For example, if I spend $10k at 2% cashback, that’s $200 (unless I use it to pay for property tax or similar with >2% added to cost when paying with CC). I rarely bother with brokerage/bank/credit bonuses of this magnitude. I’d prefer having an extra $200 to not having $200, so if I can get the extra $200 without changing spending habits, that’s nice. However, it’s not going to be a big priority for me, nor will I put in much extra effort to obtain it, or fault someone else for not prioritizing. As such I also don’t spend much effort optimizing which credit card has the highest cashback on which category purchase. I’d be more likely to prioritize which credit card has other features I value, including a quality sign-up bonus.
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I agree, and in fact I rarely use my “cash-back” cc at all, preferring to use the partnered cards to get loads of points/miles. In fact, to bring this back to the retirement $$ needs, by using these cards I don’t see why we can’t continue to stay in hotels largely free and fly about half of our flights free as well. That is important, because travel has the potential to take a big bite out of retirement income.
Of course, I pay off in full every month, keep track of matches/promotions/signup/bonuses, and I recommend that anyone else doing this “game” do the same. But if I were to switch to cash, it would absolutely leave money on the table and would have made the trip we just took, impossible (four rooms for five days on points…including the fifth night free because of status).
In retirement, I hope to travel more, not less, so I figure I’ll want to use these cards even more. That said, we can’t rely on it 100% because these programs sometimes change/devalue, or might become more regulated/taxed.
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I agree with everything said here. For folks who don’t or can’t manage their money and run credit card balances, any cash back or points is an illusory benefit. A number of years ago, I had a credit card bank as a client. Although my work with a client may be in a specialized area, I usually need to understand the client’s underlying business model and strategy. In this case, much of the data analytics and marketing was aimed at finding the intersection between two sets: 1) will always pay their bills eventually but 2) runs a balance on their credit cards.
As someone who travels a ton, I have signed up for several of the premium (high fee) credit cards that get me a) statement credits ($200 or 300) for travel, b) credit for things like NYTimes or WSJ subscriptions or Netflix subscriptions, c) lounge access, d) elite hotel status and e) other perks that I would otherwise purchase. As an example, my Hilton Diamond status gets me one to four free breakfasts in London, Kyoto, or Seoul. In London, that cost is 32 GBP a person (roughly $43 I think). The JB card with 50K spend gets me Mosaic, which means I can book early at lower cost and then cancel if the trip falls through rather than waiting. Quickly pays for itself. One card gives $200/yr Uber credits; another gives $10/month of Lyft credits. If you are incurring these expenses anyway (and I am), these reduce the net cost of the premium cards substantially.
The Chase Sapphire Reserve card used to be a no brainer, but they just raised the annual fee to a very high level and modified some of the benefits, so it may no longer be worth it. But generally, I nearly all of the fee back in various ways and get lounge access and other benefits.
@fretfulmother, if you are going to start traveling a lot more, you may want to investigate the premium cards to see if any are worth it.
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$200 Uber credits sounds like Amex Platinum, which has a $695 fee. Some card owners will have >$695 in benefits, and some will not. Some will only receive $695 in benefits if they change their usual travel habits to spend more than the would otherwise, which contributes to how Amex profits from such offers.
What I personally find is the greater benefit to the Amex Platinum is the sign-up bonus, which is currently listed as 175k points for me (offer varies for different persons / IP addresses). These points can be redeemed at 1.1c per point via Schwab for valuation of $1,925, or more for certain travel purchases. This more than negates the $695 fee, before even considering benefits. I pursue a new CC sign-up bonus like this each time I pay my semi-annual property tax, using the property tax bill to meet spending requirements.
For Amex Platinum, I did find some of the other perks valuable, particularly $15/month Uber + $20/month digital streaming (can only be used at Hulu/Disney, Peacock, NYT, and WSJ) credits, and Walmart+ membership. However, these benefits were not worth worth $695 to me. I don’t travel often and prefer lower cost options when I do travel, so travel benefits are not high for me. For example, the $200 annual hotel credit sounds good in theory, but can only be used at a very limited number of hotels, which tend to be high end (most are far more than $200 per night) and not lowest priced seller for that hotel. If I used the free $200 hotel credit, I’d end up spending more total $ than if I did not use the $200 hotel credit. I cancelled the card after 1 year, as they would not reduce fee enough to justify continuing a 2nd year.
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I also play the credit card game, getting bonuses and cancelling after the hold period, and doing it again a few years later. It is very lucrative to us, as we get several thousand dollars a year in hotel rooms/airline tickets/cash. We still travel a fair bit, though not as much as we used to, and our best cards are recycling Delta Reserve cards (even got one for a kid, for the bonus) and Marriott Bonvoy Brilliant, as we usually stay at Marriotts and fly on Delta. I wouldn’t get a bunch of travel cards, but stick to a few that we use a lot. The best deal now I found is that I can get 40K Marriott points for referring my husband to a Marriott Bonvoy card, and he gets five free nights, all for $95. I love staying at a Ritz every year and using an upgrade cert to get a suite, paying absolutely nothing. I would never pay for business class or expensive hotels, but I’m happy to play the game and get it for free. I hope those deals don’t disappear.
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I think our wallets may match up fairly well @shawbridge - I do Hilton Surpass (AmEx) and the JetBlue card. Recently, when we started doing travel to places better served by Delta, and when I started being anxious about JB, I took a huge signup bonus and did go for a “premium” AmEx Delta Platinum. I doubt I will be able to keep up all three at elite level so will cancel one of them next year maybe. (I really hate Barclays, which manages the JB+ card, but since one of my “perks” is no annual fee, it’s hard to say no to that one with the Mosaic at annual spend.)
We did some Chase cards but I honestly never got as much value out of those points, though I know that it’s supposed to be better overall; those are now lapsed/converted to free cards.
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Are you able to pay your property tax with a cc without paying a fee for that? The only big bill I can do on the cc with no fee is our auto insurance. If I need to make an annual spend, I put more onto our cell phone plan so that we have a credit running into the new year.
Which reminds me, we get our Hulu/Netflix/etc. free through T-mobile. Tell me about the NYT/WSJ through AmEx? Is the Delta Platinum eligible? We always get the Uber credit back, and I always get the Hilton credit back because of our handful of paid stays.
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When you cancel your cards, does that affect your credit score?
We currently have no debt but when we retire, we were going to rent for a year in different parts of the country. So although right now the credit score doesnt affect us, it may in the future.
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If you have strong credit 750+), it will barely cause a blip.
Many people juggle, taking the next deal.
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We’re probably going to cancel the Chase Sapphire Reserve. They just raised their annual fee to $795 and if you add another user, it’s now $195.
We were paying $625 which was fine because of the travel credit and the transfer to Hyatt but now it’s not worth it and those additonal credits are a pain in the butt.
I was going to downgrade to another Chase card but I may just cancel outright.
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The Delta Amex cards require a person to renew it before the companion certificate kicks in. I might be getting less in the bonus miles by not playing the “cancel and reapply”, but to add to the challenge, our credit is frozen and IDK which bureau Delta uses so DK which to unfreeze. So I don’t cancel and reapply. I’ll just take my companion ticket.
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