General spending cards

For just about anything you want to get off your chest about credit cards.
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kdm31091
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General spending cards

Postby kdm31091 » Wed Jun 08, 2016 8:44 pm

Posted this on MF and pretty much got disagreed with (as expected, of course, since some people just want the maximum reward possible even if we're talking about $2 a year difference).

What do you guys think?

Most of us have several cards for various categories, be it groceries, gas, dining, whatever. Most also have a generic 1.5% or 2% card for "everything else".

But outside very large spenders, is that "everything else" card really necessary? Yes, it's nice to make sure some transactions are not only earning 1%, but how many transaction is that really? Most cards have redemption thresholds, and some require a lot of spend to meet, so if you are diluting across many specific use cards, how long is it taking to get to even cash out on the "generic" card?

This isn't an argument or knock against anyone but I'm finding that really the 1.5% or 2% cards seem to be best for people who want to just have one card, put all their spend on it, and be done. Otherwise, there's just not a huge gain to be had if you're already using specific cards for gas, groceries, dining, etc which are the basic major spend areas. Of course, monthly bills are a factor, but many of them surcharge for CC use anyway.

Thoughts, anyone? I realize it's similar to "spreading too thin" or "diluting rewards" but I was just thinking about it recently and it seems that having a bunch of category cards AND a general spend card may be redundant for some and mutually exclusive, at least if you want to actually cash out your rewards with any frequency. I come from a perspective of fairly low retail job income and spending, so keep that in mind. Higher spend can obviously justify more.


To My Credit
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Re: General spending cards

Postby To My Credit » Wed Jun 08, 2016 9:08 pm

I think a 2% cashback card is a good idea as a long-term card. It may only add up to $30 a year, but that's going to add up to $300 over a long enough timespan. And that's assuming you only spend $250/month on everything else. I sometimes spend up to $500. And I may not be accounting for certain large purchases that I might be forgetting.
Current cards: BankAmericard CR, BankAmericard BBR, Citi Double Cash, Chase Freedom, AmEx BCE, Discover It
Wishlist: US Bank Cash+

Tubpbs
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Re: General spending cards

Postby Tubpbs » Wed Jun 08, 2016 9:34 pm

kdm31091 wrote:Posted this on MF and pretty much got disagreed with (as expected, of course, since some people just want the maximum reward possible even if we're talking about $2 a year difference).

What do you guys think?

Most of us have several cards for various categories, be it groceries, gas, dining, whatever. Most also have a generic 1.5% or 2% card for "everything else".

But outside very large spenders, is that "everything else" card really necessary? Yes, it's nice to make sure some transactions are not only earning 1%, but how many transaction is that really? Most cards have redemption thresholds, and some require a lot of spend to meet, so if you are diluting across many specific use cards, how long is it taking to get to even cash out on the "generic" card?

This isn't an argument or knock against anyone but I'm finding that really the 1.5% or 2% cards seem to be best for people who want to just have one card, put all their spend on it, and be done. Otherwise, there's just not a huge gain to be had if you're already using specific cards for gas, groceries, dining, etc which are the basic major spend areas. Of course, monthly bills are a factor, but many of them surcharge for CC use anyway.

Thoughts, anyone? I realize it's similar to "spreading too thin" or "diluting rewards" but I was just thinking about it recently and it seems that having a bunch of category cards AND a general spend card may be redundant for some and mutually exclusive, at least if you want to actually cash out your rewards with any frequency. I come from a perspective of fairly low retail job income and spending, so keep that in mind. Higher spend can obviously justify more.


I would say I agree. I have the Double Cash, but it was a product change from the Platinum Select (I believe). Also, at the time, it would have been my general spend card / main use card. I sill use it and I very much like the product itself, but I would agree that if you're focusing on points for example, it's a bit of a waste. I would say, at the same time, the Chase "cash back" cards (Freedom and Freedom Unlimited) earn points so the "dilution" is irrelevant as you're actually maximizing "cash back" and points if CSP is your main spend card.
Amex - BCP, Platinum, Business Gold
BoA - BankAmericard Cash Rewards
Chase - Freedom, CSP, RC, Ink Plus
Citi - DC, Prestige
Discover - It

augiedog
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Re: General spending cards

Postby augiedog » Wed Jun 08, 2016 11:31 pm

I have a QuickSilver but I signed up mainly for the bonus. Double Cash doesn't offer a sign-up bonus, which makes it very unattractive because even a small bonus makes up for not receiving that extra 1%. Lately the cards I've been using are for category spending: Discover, Freedom, Target, Diamond (5% online purchases). So many covered categories make it hard for me to justify having a hard just for 2% on everything else.

With groceries being the category I use the most I use my Blue Cash Everyday a lot. The card does offer the best non-rotating cash back on groceries (for no-AF). Amex Offers also make the card worth using, especially during the holiday season. So while it's only 1% instead of 1.5% or 2%, it does help boost my cash back to the required $25 increments. I really do not finding myself in many situations where I would benefit from that extra 1%.

The point you make about redeeming frequency is an important one I have considered too. Part of receiving cash back is that it does feel rewarding. Having that money sitting around unredeemed all year long doesn't feel very good, and risks expiration. Also, I don't like having another account to pay off during the month, it makes it harder to figure out what I'm really spending.
American Express: Blue Cash Everyday (10k), Everyday, ; Discover It (7.3k) ; Target (2.1k)

Citi: Diamond (2k) ; Bank of America: Cash Rewards (2.6k) ; Capital One: Quicksilver (3k) , Sony ; Chase: Freedom (3.7k), Slate (3k), (Amazon) ; Barclay Ring ; Synchrony: Walmart MC, Amazon, Ebates

kdm31091
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Re: General spending cards

Postby kdm31091 » Thu Jun 09, 2016 5:50 am

augiedog wrote:I have a QuickSilver but I signed up mainly for the bonus. Double Cash doesn't offer a sign-up bonus, which makes it very unattractive because even a small bonus makes up for not receiving that extra 1%. Lately the cards I've been using are for category spending: Discover, Freedom, Target, Diamond (5% online purchases). So many covered categories make it hard for me to justify having a hard just for 2% on everything else.

With groceries being the category I use the most I use my Blue Cash Everyday a lot. The card does offer the best non-rotating cash back on groceries (for no-AF). Amex Offers also make the card worth using, especially during the holiday season. So while it's only 1% instead of 1.5% or 2%, it does help boost my cash back to the required $25 increments. I really do not finding myself in many situations where I would benefit from that extra 1%.

The point you make about redeeming frequency is an important one I have considered too. Part of receiving cash back is that it does feel rewarding. Having that money sitting around unredeemed all year long doesn't feel very good, and risks expiration. Also, I don't like having another account to pay off during the month, it makes it harder to figure out what I'm really spending.


100% agree. It's hard to hit thresholds if you are spending across a bunch of cards. I also like having less bills to pay, not paying 15 cards every month and adding up the total.

Some people on MF are mentioning diversity and wanting a thick file. While these things are important, I think in the CC world we are in a bubble sometimes and we forget that most people in the "real world" have 3 or so cards, give next to no thought about this stuff, and get through life just fine. All the hype about needing a "thick file" often feels like it's just people trying to justify things out loud to themselves that they know don't make a whole lot of sense (i.e., having 15 cards just for "diversity").

Again, if someone wants a bunch of cards, that's fine and it's their choice, but they don't have to act as though it's a necessity for good credit.

MemberSince99
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Re: General spending cards

Postby MemberSince99 » Thu Jun 09, 2016 7:57 am

Not necessary

But having a credit card isn't necessary either. I went years without having a single one not all that long ago.

I will say it's nice to have. I'm glad to 've diversified as well

augiedog
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Re: General spending cards

Postby augiedog » Thu Jun 09, 2016 3:01 pm

kdm31091 wrote:
100% agree. It's hard to hit thresholds if you are spending across a bunch of cards. I also like having less bills to pay, not paying 15 cards every month and adding up the total.

Some people on MF are mentioning diversity and wanting a thick file. While these things are important, I think in the CC world we are in a bubble sometimes and we forget that most people in the "real world" have 3 or so cards, give next to no thought about this stuff, and get through life just fine. All the hype about needing a "thick file" often feels like it's just people trying to justify things out loud to themselves that they know don't make a whole lot of sense (i.e., having 15 cards just for "diversity").

Again, if someone wants a bunch of cards, that's fine and it's their choice, but they don't have to act as though it's a necessity for good credit.


Having a "thick file" is something I have attained just because of all the sign-up bonuses I have claimed. I never use most of the cards in my profile. Lately, I have been trying to limit my wallet to a maximum of 3 cards. This has worked out for me a lot more than what others think, that having so many active accounts is better for credit. Credit Karma says my Equifax is a 761 ("excellent"), the highest score I have seen on my CK.

A lot of us find that others on myfico are paying 15 cards a month, which means that they're probably scheduling a payment every other day! It's much easier to make mistakes when you have so much going on. I find that if I do get a good sign-up bonus, I will leave a small balance on the card that will auto-pay itself until a month before the 0% ends.

My score has really grown since I have had my first credit card. It's a lot easier to do than what a others may think. For one, I have always paid off my balances on time. This is the single most important factor in credit, your score plummets when you can't make timely payments. When I first started, my CC limit was $500. Since I have gotten my limits increased, I have been able to keep a low balance, which is the second most important factor (but something one should not worry about in their first year of having credit - limits will naturally be low).

As a side note, Citi Diamond sent me an email for 5% on dining/gas/groceries. This card I got just to finance a large household purchase (my washer/dryer/dishwasher), and has pleasantly surprised me with 5% offers since I've had the card. This will replace my Chase Freedom since I just maxed out the grocery category.
American Express: Blue Cash Everyday (10k), Everyday, ; Discover It (7.3k) ; Target (2.1k)

Citi: Diamond (2k) ; Bank of America: Cash Rewards (2.6k) ; Capital One: Quicksilver (3k) , Sony ; Chase: Freedom (3.7k), Slate (3k), (Amazon) ; Barclay Ring ; Synchrony: Walmart MC, Amazon, Ebates

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CarefulBuilder14
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Re: General spending cards

Postby CarefulBuilder14 » Thu Jun 09, 2016 10:11 pm

I don't think of general spend cards very differently than I do a category or travel card...it's all about a card's marginal value over a period of a few years.

I suppose in the case of no-AF cards, I'm more willing to consider a longer period of time.
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Re: General spending cards

Postby takeshi » Fri Jun 10, 2016 8:09 am

Posted this there as well but the short version is that this falls under the standard due diligence that anyone should be doing when considering cards based on rewards anyway. I don't bother with a 1.5% or 2% card on all spend as I can get at least that with UR so my CSP is my everything else card for noncategory spend.

People seem to obsess over % and X, fussing over getting every little bit assuming that more is simply better without understanding the $ impact. However, many obviously aren't considering where the majority of their money is going. Given that rewards are a small % of spend it doesn't make sense to obsess over small amounts of spend in a given category.

However, it's up to each to figure that stuff out as well. If they can't put forth the time, effort and math to figure out what's really best suited to them that's their problem.

Well, I don't think this post ended up any shorter than the one on MF after all...

kdm31091 wrote:Thoughts, anyone? I realize it's similar to "spreading too thin" or "diluting rewards"

Similar but not quite as big of a deal with cashback cards aside from the impact of minimum redemption thresholds, if applicable. There's certainly impact to number of cards as well but that's a subjective matter.

kdm31091 wrote:Some people on MF are mentioning diversity and wanting a thick file. While these things are important, I think in the CC world we are in a bubble sometimes and we forget that most people in the "real world" have 3 or so cards, give next to no thought about this stuff, and get through life just fine. All the hype about needing a "thick file" often feels like it's just people trying to justify things out loud to themselves that they know don't make a whole lot of sense (i.e., having 15 cards just for "diversity").

You should know well enough by now that if you're trying to make sense of MF that you're just going to drive yourself nuts. Yes, people there justify all sorts of things for dubious reasons. Most of them seem to have their minds made up and are just looking for validation for their poor decision making which is why they're in the situation they're in in the first place. I can't pick on them too much on that point since my credit was in terrible shape back in 2012 when I first ran across MF. Yes, they don't represent most people but no discussion forum on any topic represents the majority -- this one included.

It's not really what best serves most people that matters anyway. Each person has to sort out what best serves the individual. People tend to look for easy solutions and explanations and it's much easier to just look at % and think "2% is clearly better than 1%" and go with that versus really thinking about all of the considerations at play. Very few seem to be able or willing to really put the effort into evaluating the points/miles rewards programs which take much more consideration than cash back which is dead simple by comparison.

All you can do is present info. What people do with that info is up to them.

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Vattené
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Re: General spending cards

Postby Vattené » Fri Jun 10, 2016 4:42 pm

If I were solely getting rewards in the form of cash back, in theory I wouldn't have a problem with a guaranteed 2% card. This is my personal preference, but I like building up rewards - even cash back - to redeem in large amounts anyway and for a specific thing. Yes, I could take it as soon as possible and I understand the argument that one should get the cash as soon as they can, but if I'm going to devote this much time to credit card rewards I want to "feel it." If I just took a statement credit as soon as possible I wouldn't even notice it, in terms of my bank account. So, I'd have no problem waiting a long time to reach a redemption threshold.

However, I'd still be a little hesitant to get too many category cards because I wouldn't want it to impact my spending. I'm invested in MR anyway, so I'm happy with ED as a general spend card.
-Vattené
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