Yesterday the Honeybee and I got another dividend rewards check from our credit card company — this time for $300.00. I love it when those checks come in, as we use the money to treat ourselves to a nice dinner, night on the town, or other fun activity.
Over the past seven years we have earned more than $2000 in cash dividends for nothing more than using our credit card.
We get the dividend checks because we have a credit card that pays us a one percent dividend on all of our purchases. We try to use that dividend credit card — along with a second rewards credit card that accrues hotel points — for every purchase we can, from large purchases like new furniture to smaller stuff like our groceries and gasoline.
Of course, these credit card rewards programs only make sense if you’re the type who absolutely refuses to carry a balance from month to month — otherwise you end up worse off financially. Needless to say, we only use the card if we know we can pay it off in full before the grace period expires.
As for those of you who lack such fiscal discipline, please … do yourself a favor and stay away from credit cards — regardless of whether they offer dividends and other rewards or not. You’ll be much better served financially by learning to control your urge for instant gratification and eliminating any revolving debt you’ve run up on your existing credit cards.
After all, with few exceptions, I hate paying interest to anybody. You should too.
Photo Credit: borman818
(This is an updated version of an article that was originally posted on November 8, 2009)