Speaker 1: Welcome to How the Money. I'm Joel and I'm Matt,
Speaker 1: and today we're talking about using credit cards like a pro. Alright, Matt.
Speaker 1: First thing on everybody's minds after last week this awesome
Speaker 1: giveaway we have to update people on. Yeah, thanks to
Speaker 1: everybody that got on our Instagram and uh figured out
Speaker 1: how to how to register and be a part of
Speaker 1: our giveaway. And thanks to Republic Wireless as well for
Speaker 1: giving us that sweet giveaway. Man, they totally hooked us
Speaker 1: up with that and we couldn't have done without him. Yeah,
Speaker 1: sweet deal. Dollars towards a new phone and a lot
Speaker 1: of phones are free because with that and three months
Speaker 1: of free service. And as you guys know from from
Speaker 1: listening to the last episode two, we're fans of Republic
Speaker 1: Wireless no matter what their plan. Pricing is just you know,
Speaker 1: among the cheapest out there, and uh they've all they've
Speaker 1: got great phones you can bring your own. Just a
Speaker 1: great company to consider doing business with. Yeah, so you
Speaker 1: wanna announce too, Yeah, Matt, So the winner is drumroll please,
Speaker 1: Brian Sebezma. Brian, thanks for following us on Instagram. Thanks
Speaker 1: for entering our giveaway. It was a lot of fun.
Speaker 1: We'll get the republic wireless stuff over too soon. And
Speaker 1: that six pack of awesome beer. Yeah, that was a
Speaker 1: sweet giveaway. Man. I'm hoping we can do more of these,
Speaker 1: you know, in the future. Just giving away free stuff,
Speaker 1: giving away things that aren't ours to give is a
Speaker 1: lot of fun. You know, that's pretty awesome. Maybe maybe
Speaker 1: at some point we'll give away an autograph pair of
Speaker 1: your George. Oh yeah, I think those would would go
Speaker 1: for a lot of money. You know how the show
Speaker 1: Arrested Development, Like, you'll watch something in season one and
Speaker 1: then in season three it comes back the George thing.
Speaker 1: I'm gonna I'm telling you, it's gonna make it at
Speaker 1: least like every third episode it's gonna make an appearance.
Speaker 1: I thought you're gonna talk about what's his name? Being
Speaker 1: a never nude. So it's crazy, is I never even
Speaker 1: watched uh Arrested Development. I watched like the first season
Speaker 1: then just got sick of it because your sense of
Speaker 1: humor is lacking. I don't maybe so, man, Like I
Speaker 1: think you and I we have a little bit different
Speaker 1: since the humor and we just we didn't dig it, man, Matt,
Speaker 1: real quick before we get into the topic of credit cards.
Speaker 1: I wanted to talk about last year and what that
Speaker 1: meant in the craft beer world, because you know, we
Speaker 1: like beer. Uh found this stat interesting that it was
Speaker 1: a really fantastic year for craft beer in a lot
Speaker 1: of ways. We had almost a thousand breweries new breweries
Speaker 1: open up in the United States total. Uh, But on
Speaker 1: the flip side, we had a hundred and sixty five
Speaker 1: breweries closed down. UM, So I kind of wanted to
Speaker 1: know your thoughts on this. It seems like craft beer
Speaker 1: feels like it's like flying high, but then there's this
Speaker 1: contracting in part of the industry too. So what do
Speaker 1: you think about all those breweries? Man, I think those
Speaker 1: breweries that well, I mean, it's competition, right, and so
Speaker 1: a lot of it, Like, yes, there's still a ton
Speaker 1: of people out there that are wanting like a good
Speaker 1: local craft beer nearer they're living. But there's a lot
Speaker 1: of breweries that have been opened for a while that
Speaker 1: you know, may not be that good. It's when you've
Speaker 1: kind of had these middle of the road breweries that
Speaker 1: aren't really crashing it locally, and they're also not big
Speaker 1: enough to really you know, work the system and make
Speaker 1: it happen from a distribution standpoint, and I think those
Speaker 1: guys are the ones who are dropping out, because there
Speaker 1: are a lot of these smaller guys that are starting
Speaker 1: out and putting out new, amazing stuff, and you know,
Speaker 1: given those guys a run for their money. Yeah, it's
Speaker 1: gonna be interesting to see what happens over the next
Speaker 1: couple of years, because, um, there's just not room to
Speaker 1: continue to grow at I think it's such a torrid
Speaker 1: pace that we've been at, and I think some of
Speaker 1: those bigger breweries that some of the national and some
Speaker 1: of the regional breweries just got used to growing at
Speaker 1: growth rates and that's just not sustainable, especially with all
Speaker 1: the competition and how craft beer is getting more localized.
Speaker 1: So you know, we've got so many more small, small
Speaker 1: craft breweries that we can bike to or a quick drive,
Speaker 1: and so we're just buying a lot more locally. You know,
Speaker 1: you picked up a beer that we're gonna have on
Speaker 1: the show hopefully next week that is just from a
Speaker 1: brew pub down the street that started canning, and so
Speaker 1: that's just that's just kind of the trend right now.
Speaker 1: And and I think we're gonna see more of that,
Speaker 1: and I think we're gonna see probably some more open
Speaker 1: that are all that are neighborhood focused, that are incredibly small, yep,
Speaker 1: but that make their presence known in the community. And
Speaker 1: then we're gonna see some of the bigger players, whether
Speaker 1: they're regional or national, either just losing steam and losing
Speaker 1: market share or also maybe getting to the point over
Speaker 1: over a few years time where they had shuttered their
Speaker 1: doors completely. Yeah. I was talking to a buddy over
Speaker 1: at Monday night Monday Night brewing, and that's one of
Speaker 1: the things he was excited about seeing in the future
Speaker 1: is all of these I mean there's small towns across
Speaker 1: the country, you know, like across every state, there's these
Speaker 1: all these smaller towns. And even in these smaller towns,
Speaker 1: there's breweries that are kind of popping up and they
Speaker 1: are becoming sort of like the local brewery that's making
Speaker 1: awesome beer. It's like the equivalent of like a farmer's market,
Speaker 1: except for its beer, you know, instead of like go
Speaker 1: into your local farmers market and getting fresh samantas and
Speaker 1: veggies in the summer or eggs, that's where you're getting
Speaker 1: your beer. Now. It's it's sort of following that model.
Speaker 1: And that's exciting. Yeah. And I think the key to
Speaker 1: the whole thing, and I think it makes complete sense,
Speaker 1: is good beer. And I think it doesn't matter whether
Speaker 1: you're a big national brewer or you are my next
Speaker 1: far group pub. There are a couple of local breweries
Speaker 1: that you and I rarely visit just because we don't
Speaker 1: really enjoy their beer. We don't think they're making great stuff.
Speaker 1: We try to support them and go every once in
Speaker 1: a while, but it's just, you know, it's not our
Speaker 1: favorite beers. Then there are other places really close to
Speaker 1: us that have amazing beers. For instance, the beer we're
Speaker 1: about to drink is one of our favorite beers, and
Speaker 1: it's this big national brewery. And I think the key
Speaker 1: comes down to if you're making great beers and you're
Speaker 1: making what the public wants, it doesn't matter if you're
Speaker 1: distributed in all fifty states or you literally have to
Speaker 1: go to the place where it's made to pick it up.
Speaker 1: As long as you're making good beer, it's gonna sell.
Speaker 1: People are gonna find you. Yeah. And the word of
Speaker 1: mouth in the craft beer scene is is like worth
Speaker 1: its weight in gold. And so speaking of beer, we
Speaker 1: told you last week Bull of our brewing company UM
Speaker 1: out of Kansas City was kind enough to send us
Speaker 1: to awesome bottles of beer, and we had the Grand
Speaker 1: Crew last week, which we were amazing, super fond of
Speaker 1: good and uh, this week we're cracking Love Child number eight.
Speaker 1: So this is a sour beer that they make annually
Speaker 1: or or twice a year. Yeah, I think they do
Speaker 1: it once a year and it's a sour So it's
Speaker 1: a I mean literally in the complete opposite direction, the
Speaker 1: other end of the spectrum when it comes to beer light, sour, tart, acidic,
Speaker 1: you know, all the different sort of qualities that you
Speaker 1: typically don't find. And a stout blended with a quad
Speaker 1: which is what what we had by them last week.
Speaker 1: I think I've I started drinking this particular beer back
Speaker 1: when it was Love Shot number five. I think the
Speaker 1: Love Shot number five was the first one I've had,
Speaker 1: and then six, and I don't know if I had seven.
Speaker 1: So well, this I love to read the labels and
Speaker 1: and see what kind of quirkiness comes out there. This
Speaker 1: one's awesome because what's to say specifically, because it's a
Speaker 1: sour beer and it's got multiple different strains in it.
Speaker 1: Let go Bacsilus and Bretton to miacies. It says these
Speaker 1: may change over time because these beers do develop in
Speaker 1: the bottle, So this is uh, these may change over time.
Speaker 1: But don't we all it's so true Bolivart. I mean,
Speaker 1: I agree, I'm not the same man that I was yesterday. Yeah,
Speaker 1: I mean it brings a level of humanity to their beers.
Speaker 1: That's like, hey, just be patient, all right. But let's
Speaker 1: I love that sound, man, I know, there's not not
Speaker 1: much better than that. This one is pouring and beautiful
Speaker 1: golden color. I'm just gonna put it all on my glass.
Speaker 1: What color is that? It's just almost like a nice
Speaker 1: olden amber, you know. It's like a murky, murky golden color.
Speaker 1: It's got a great nose to it. So this is
Speaker 1: why I'm super excited about this. I remember the love
Speaker 1: Shots always being pretty aggressive with their acidity levels, which
Speaker 1: is one of the things I love. Yep, just had
Speaker 1: a taste still is that's great. It's really at like, um,
Speaker 1: it's like a clean version of a goose, almost like
Speaker 1: a much cleaner It's still got a little funk to it,
Speaker 1: but a little bit of funk, little bit of sweetness
Speaker 1: just the right amount of sweetness for me. Man. That is,
Speaker 1: I really like delicious, some a nice funk factor to
Speaker 1: the beer. And on the back too. I mentioned the
Speaker 1: label they describe that it's got some funk, a fair
Speaker 1: amount of sour, and a little bit of fruit notes.
Speaker 1: So yeah, I kind of like those like scales like
Speaker 1: that kind of help you understand what you're getting into
Speaker 1: when you pop the top. Super tasty alright, Matt, So
Speaker 1: the first rule of using credit cards like a pro,
Speaker 1: pay them off every month. We're gonna touch on some
Speaker 1: things that can help people that don't carry credit card debt,
Speaker 1: how to use their credit cards better, how to make
Speaker 1: wise decisions when it comes to you know, what credit
Speaker 1: cards they get and how to utilize them. But the
Speaker 1: first rule, the very first thing you have to talk about.
Speaker 1: If you are listening to this and you don't pay
Speaker 1: off your credit card balance every month, that is your
Speaker 1: first and really most glaring goal that you need to accomplish.
Speaker 1: You want to sure that your credit card is getting
Speaker 1: paid off and that you're not accruing crazy amounts of interest. Yeah, man,
Speaker 1: that's step one. Like, that's the very first thing you
Speaker 1: need to need to do, Like before we get into
Speaker 1: the little nuance and the tips or whatever. I mean,
Speaker 1: if you're carrying a balance and you're you're paying interest,
Speaker 1: you are not using a credit card like a pro,
Speaker 1: and you need to like go back and do that first. Yeah,
Speaker 1: that's essentially one on one maybe even just like a
Speaker 1: remedial class you need to take. Uh. And I know
Speaker 1: that you know, there are a lot of people that
Speaker 1: have struggled with taking out too much credit card debt
Speaker 1: and and they're you know, working on paying it back
Speaker 1: and it can be tough. So I just want to
Speaker 1: encourage you if you are one of those people struggling
Speaker 1: under a weight of credit card debt, like you can
Speaker 1: do it, and there are a lot of tools out
Speaker 1: there to help you. But also know that it needs
Speaker 1: to be almost a singular focus for you to pay
Speaker 1: that off before you really start taking many of these
Speaker 1: other financial lessons, financial ideas and under consideration. Because if
Speaker 1: you're paying you know, nineteen interest every month on this
Speaker 1: credit card and you're only paying the minimum them or
Speaker 1: you're paying more than the minimum, but you find it
Speaker 1: hard to really make much of a dent in that balance,
Speaker 1: you just need to be putting all of your efforts
Speaker 1: into that one area. I mean, unless you've got like
Speaker 1: some sort of crazy title loan or something like that,
Speaker 1: that's even worse. I mean, this is probably the worst
Speaker 1: debt in your life percentage wise, and so all of
Speaker 1: your focus needs to be going at that. And I
Speaker 1: just encourage you that if you do have a lot
Speaker 1: of credit card debt, go at it. You can do it. Uh.
Speaker 1: And there's a lot of success stories out there of
Speaker 1: people not even making tons of money, but that are
Speaker 1: able to pay it on their debt in a quick
Speaker 1: amount of time just by focusing on it intently. Yeah, Joel,
Speaker 1: that's a good word of advice. And and really we
Speaker 1: want to encourage folks just to think about sort of
Speaker 1: your behaviors and your patterns, like you, like, we want
Speaker 1: you to know yourself. And if you know that by
Speaker 1: applying for another credit card, that's gonna maybe encourage you
Speaker 1: to go into more debt or maybe even spend more
Speaker 1: than you typically would. We'll kind of get into that
Speaker 1: later on. But this is this may not be the
Speaker 1: episode for you. This may not be sort of the
Speaker 1: sort of week or the maybe you know, the sort
Speaker 1: of financial life hack that would be great for you
Speaker 1: to do, and so it's just important to kind of
Speaker 1: know yourself, know what your tendencies are, and take that
Speaker 1: into account before you hop onto nerd wallet and start
Speaker 1: looking up all the best credit cards right that offer
Speaker 1: sweet bonuses. And so one thing you should consider if
Speaker 1: you have credit card debt, whether it's you know, a
Speaker 1: large balance or a small balance, and you have good credit,
Speaker 1: the only reason we would encourage you to open up
Speaker 1: another credit card is if you could do this one thing,
Speaker 1: open up a credit card that has a promotional zero
Speaker 1: percent interest rate. So if you've got a credit score
Speaker 1: and go back and listen to our episode on credit
Speaker 1: scores and now to improve that. But if you have
Speaker 1: a good credit score that's typically seven seven forty year above,
Speaker 1: if you're in that range, you're likely getting offers in
Speaker 1: the mail with zero percent promotional interest rates of twelve, fifteen,
Speaker 1: eighteen months. And if you've got a credit card balance,
Speaker 1: it would be wise to open up a zero percent
Speaker 1: credit card, transfer the balance over and pay that likely
Speaker 1: three percent fee to do that, and then essentially give
Speaker 1: yourself fifteen eighteen months to tablet as quickly as possible
Speaker 1: where you're not paying any interest on the debt itself.
Speaker 1: And so if you have a good credit it's worth
Speaker 1: kind of going down that path. And that's the only
Speaker 1: real reason that we would consider telling you to open
Speaker 1: up another credit card. But again, if it's going to
Speaker 1: cause you to to snowball into more and more debt,
Speaker 1: it's not worth it. You just need to cut it
Speaker 1: off all together, toss them in the freezer, and just
Speaker 1: start paying it down with that laser like focus. Yes,
Speaker 1: that's definitely more of a route for someone that's like
Speaker 1: turning over new leaf, right if it's if they're like,
Speaker 1: you know what, I'm We're done with this, We're done
Speaker 1: carrying a balance. We're not gonna have credit card payments anymore.
Speaker 1: It's gonna take someone that is just all about knocking
Speaker 1: it out. Yes, So now the rest of this podcast
Speaker 1: is dedicated to the people that use credit cards and
Speaker 1: pay them off every month. If you're one of the
Speaker 1: people doing that, all the rest of these tips are
Speaker 1: for you. Yeah, man, So for those folks, a credit
Speaker 1: card is essentially a tool. You know, it's just like
Speaker 1: a great sort of product that we can sort of
Speaker 1: hack and and use in a way that you know,
Speaker 1: we essentially are able to work the system kind of
Speaker 1: play the game and get some pretty sweet bonuses along
Speaker 1: the way. Yeah, and our in our country, we have
Speaker 1: a lot of people in credit card debt, and that
Speaker 1: actually allows people that use their credit cards wisely to
Speaker 1: get some great perks and great cash back rewards. And
Speaker 1: that's essentially because people that are you know, have the
Speaker 1: credit card debt and are paying high interest rates or
Speaker 1: subsidizing the people that get points, and and they're they're
Speaker 1: subsidizing the rewards that that we get as credit card
Speaker 1: users that use it wisely. And man, I kind of
Speaker 1: like in this system to In our state, the lottery
Speaker 1: ticket sales benefit middle class and upper class families by
Speaker 1: providing free pre k and free college. And I personally
Speaker 1: benefited from both of those things in this state. Yeah,
Speaker 1: same here, And uh, I don't like it. I don't
Speaker 1: like the fact that essentially it's a huge, huge transfer
Speaker 1: of wealth from the poorts people. It's a crap system. Yeah,
Speaker 1: who can't afford it. I don't think that's a good thing.
Speaker 1: But that is the way the system is currently constructed,
Speaker 1: and the credit card system is much the same way,
Speaker 1: and so I don't like it. I don't like that,
Speaker 1: you know, the poorest people who can't pay their bills
Speaker 1: are paying exorbitant interest rates. But it does provide an
Speaker 1: ability for us to get returns that we otherwise wouldn't
Speaker 1: ye ji also for better or worse. That's kind of
Speaker 1: one of the biggest benefits of of the credit cards
Speaker 1: are the points, like the points in the cash back
Speaker 1: or the miles depending on you know, all the different
Speaker 1: cards out there have the different reward that they focus on.
Speaker 1: And that's the biggest reason why I use the credit
Speaker 1: card is is I mean we use it to pay
Speaker 1: for everything. I mean, everything that we can possibly pay
Speaker 1: for with credit card, we we throw it on the
Speaker 1: credit card and we yeah, we get the cash back.
Speaker 1: So yeah, man, if you want to use a credit
Speaker 1: card like a pro, you're gonna use credit cards that
Speaker 1: benefit you the most. And there's a lot of advertising
Speaker 1: in the credit card industry. You know, commercials all the time, NonStop.
Speaker 1: When you're web surfing, you know, you'll see ads on
Speaker 1: almost every website. You know, get this credit card, this
Speaker 1: one will make it life better. Go travel to Tahiti
Speaker 1: if you get this credit card. And I think unless
Speaker 1: you're really, really really into the credit card game, the
Speaker 1: easiest and best thing for you to do when getting
Speaker 1: a credit card is to maximize cash back because there's
Speaker 1: all sorts of loopholes when it comes to booking travel
Speaker 1: composed the blackout dates. Yeah, and maybe you think you
Speaker 1: want to travel, maybe you didn't realize all the things
Speaker 1: that it took to actually redeem those rewards. And so
Speaker 1: I think the easiest thing for people to do is
Speaker 1: to get the highest percentage cash back that they can.
Speaker 1: And so my favorite two cards are the City Double
Speaker 1: Cash Card because you get one percent when you make
Speaker 1: the purchase and another one percent when you pay. That's
Speaker 1: two percent back. And the card that I use most
Speaker 1: of the time is the Fidelity Investments Visa Reward Card,
Speaker 1: and that's two percent cash back that I can transfer
Speaker 1: into a retirement account. I can open up an investment
Speaker 1: account with Fidelity with the rewards, and the great thing
Speaker 1: about it is you're getting two percent on your money.
Speaker 1: If you transfer that money to U qualified Fidelity account,
Speaker 1: you could transfer it into a five account for your kids.
Speaker 1: There's all sorts of options with that card, but I
Speaker 1: think the easiest and best thing to do if you
Speaker 1: don't really know exactly what you're spending is like the
Speaker 1: two percent is just an easy thing to follow. There's
Speaker 1: all sorts of rotating rewards cards where every three months
Speaker 1: it's five percent in this category or that category. I
Speaker 1: think for most people were too busy, like we don't,
Speaker 1: it's hard to track of right. So one of my
Speaker 1: cards has that too, where they're like, would you like
Speaker 1: to enroll and getting you know, an extra three percent
Speaker 1: or whatever on home improvement stores, and it's just like, well,
Speaker 1: I mean yeah, because I'm logged in, I'll click yes
Speaker 1: because it doesn't require anything, you know, really extra of me.
Speaker 1: But uh yeah, man, I'm totally with you. Like for us,
Speaker 1: we've never used credit card for miles. We like to
Speaker 1: use it more as additional income as opposed to sort
Speaker 1: of like this bonus where we sort of get this
Speaker 1: thing and we kind of have this little prize and
Speaker 1: we get to do something with it. And by using
Speaker 1: that additional money to kind of plug back into our
Speaker 1: system where we've already sort of predecided what our priorities are,
Speaker 1: and then we'll use that to fund travel, or we
Speaker 1: might use that to fund you know, at line United
Speaker 1: tickets or something else that's fun that we might want
Speaker 1: to do. We keep it super simple. And we're totally
Speaker 1: with you, like we don't worry about the loopholes and
Speaker 1: just everything, all the hoops you need to jump through
Speaker 1: in order to make it work. From a mile standpoint, yeah,
Speaker 1: I think if you want the set it and forget
Speaker 1: it approach, then that's the easiest one to do. If
Speaker 1: you don't want to be thinking about fulfilling all these
Speaker 1: obligations in order to book to travel, the easiest thing
Speaker 1: is to pull out the two percent cash back card
Speaker 1: because likely the one you're using is offering you inferior
Speaker 1: rewards than two and so switch to that card and
Speaker 1: get better rewards. I will say at different times I've
Speaker 1: I've gotten travel reward cards, and I usually when I
Speaker 1: do that, I go for a specific airline. For instance,
Speaker 1: I recently got a Southwest credit card when they had
Speaker 1: a special with extra points, so I got sixty instead
Speaker 1: of the normal forty, and you know what, that's enough
Speaker 1: points for me to book a round trip ticket for
Speaker 1: my whole family of four if I wait for a
Speaker 1: sale on Southwest across the country. Right. So that's a
Speaker 1: sweet deal. But just be careful when you're getting a
Speaker 1: credit card that offers you travel rewards points. Know what
Speaker 1: you're getting into, know that you'll you want to make
Speaker 1: sure you you'll know how to redeem them. Uh, that's
Speaker 1: really important when you're considering what cards you're gonna get,
Speaker 1: and if you know you're not gonna go through those steps,
Speaker 1: just go with simple two percent cash back cards. Yeah.
Speaker 1: But yeah, man, the points the cash back and then
Speaker 1: for me, Man, recently the past few years, I've been
Speaker 1: really into the sign up bonuses. That's another sort of
Speaker 1: pro that I feel like we've been able to work.
Speaker 1: And honestly, just about every three months or so, I'll
Speaker 1: apply for a new card that's offering anywhere between three
Speaker 1: hundreds of eight hundred dollars for a sign up bonus
Speaker 1: if you spend a certain amount of money within you know,
Speaker 1: like typically three months or something something like that. Yeah,
Speaker 1: So when you're considering what credit card you're gonna get,
Speaker 1: consider what the rewards are and whether you're actually gonna
Speaker 1: know how to use them, and if you're not going
Speaker 1: to take the time to figure out how to redeem
Speaker 1: the miles, don't be suede a commercial and sign up
Speaker 1: for a credit card just because oh I want to
Speaker 1: go to Tahiti. Instead, get a cash back credit card
Speaker 1: and consider the sign up bonus too. So some of
Speaker 1: these credit cards are going to offer you know, richer
Speaker 1: sign up bonuses and it might be worth it to
Speaker 1: make three bucks off the bat if you're gonna fulfill
Speaker 1: those obligations of spending within the first ninety days. That
Speaker 1: can be a really great perk of getting a new
Speaker 1: credit card too. Yeah, and a good place to look
Speaker 1: those up would be nerd wallet dot com. They basically
Speaker 1: have all the credit cards, they've reviewed them all. They
Speaker 1: kind of have all the information laid outside by side,
Speaker 1: so you can it's really easy to kind of compare
Speaker 1: look at the different costs associated with it and the
Speaker 1: different percentage of cash back that you get, plus any
Speaker 1: sort of sign up bonuses on there as well. So
Speaker 1: that's a great tool. Yeah, another way to use a
Speaker 1: credit card like a pro It's easier to track than cash.
Speaker 1: So if you have been kind of working on a
Speaker 1: cash system that has its pros as well, usually tend
Speaker 1: to spend less. But I love how easy it is
Speaker 1: to track my credit card spending in Mint. I just
Speaker 1: tie it straight in there. It's easy to kind of
Speaker 1: run through how I've spent my money over the past month.
Speaker 1: Or yesterday even just based on how I use my
Speaker 1: credit cards, and I can see kind of, you know,
Speaker 1: how our families doing overall pretty quickly, and where our
Speaker 1: money goes. It's just so much easier to track, yes man.
Speaker 1: And if you listen back to our episode on budgets,
Speaker 1: I think it was episode number two. That's basically the
Speaker 1: easiest way to get started on creating a budget is
Speaker 1: looking at your actual expenses, and the easiest way to
Speaker 1: do that is looking at your credit card statement from
Speaker 1: the from the month before. So a lot of times
Speaker 1: people are get overwhelmed, you know, they don't know even
Speaker 1: know where to start when it comes to making a budget,
Speaker 1: And the best place to start is by looking at
Speaker 1: what you typically spend. And it's easy to do that
Speaker 1: by again, just looking at your credit card statement. Man.
Speaker 1: Another pro of using a credit card is that fraudulent
Speaker 1: charges and unauthorized transactions cannot be held against you like
Speaker 1: they can with a debit card. Yeah, have you ever
Speaker 1: just disputed a fraudulent charge in your card before? I
Speaker 1: don't know if I've disputed a fraudulent charge, but I've
Speaker 1: definitely filed a charge back against a merchant for not
Speaker 1: delivering goods like they should have. And so that's definitely
Speaker 1: a perk of using a credit card. And I will
Speaker 1: say debit cards, many of them provide some of these
Speaker 1: same features of the credit card on their own, but
Speaker 1: they're not legally held to the same standard as credit cards.
Speaker 1: And so using a credit card for your purchases does
Speaker 1: put you in a better situation when it comes to
Speaker 1: your rights, and typically too with a credit card. I mean,
Speaker 1: if there's an unauthorized transaction, that's not money out of
Speaker 1: your pocket yet, like it's charged on the card and
Speaker 1: you can dispute it. But that's one of the disadvantages
Speaker 1: of say, like a debit card, right, Like folks say
Speaker 1: that like, oh, you have the same kind of protection.
Speaker 1: It's a visa card. It still got that protection, what
Speaker 1: except with a debit card, like that money is already
Speaker 1: out of your wallet, like and you've gotta get it back, yeah,
Speaker 1: and you've got to get it back, versus saying that like,
Speaker 1: oh no, this isn't something I charged on, you know,
Speaker 1: with your credit card. And in that case, by the
Speaker 1: time the statement actually rolls around and by the time
Speaker 1: you have to actually pay, it'll it's gonna roll off
Speaker 1: they'll you know, they'll address it. Same thing with you know,
Speaker 1: booking a rental car or a hotel or something like that.
Speaker 1: They'll put a hold on your account usually, and when
Speaker 1: you have a credit card you don't to worry about that.
Speaker 1: But if you have a debit card and you overdraw
Speaker 1: your account because they put a hold on it, you're
Speaker 1: liable for over draft fees. Yeah. Man, it's been a
Speaker 1: long time actually since I've had an actual, you know,
Speaker 1: fake fraudulent charge whatever my credit card. It would mean
Speaker 1: it was years ago. The credit card company caught it
Speaker 1: before I did, and they gave me a call and
Speaker 1: we're just like, hey, are you making plane ticket purchases
Speaker 1: in like Israel? And I was like, nope, it's not me. Yeah,
Speaker 1: And in that case, it was super easy, I was.
Speaker 1: I just said, these are not my charges, and they
Speaker 1: just shut down the account. They sent me a new card,
Speaker 1: you know, and it's super easy. So one tip if
Speaker 1: you want to use your credit card, you're worried about
Speaker 1: getting into debt and you want the parks of using
Speaker 1: a credit card, but you kind of want that ease
Speaker 1: of mind of paying with a debit card and knowing
Speaker 1: that that's taken care of. There's a really cool new
Speaker 1: app called debt Eze, and essentially Debatize uses your credit
Speaker 1: card but treats it like a debit card. How does
Speaker 1: it work, man, because that sounds awesome. So you make
Speaker 1: purchases on your credit card like you normally would, they
Speaker 1: deduct the amount from your checking account every day, and
Speaker 1: at the end of the month, they pay your credit
Speaker 1: card bill. So yeah, so it's really cool, Like it
Speaker 1: feels like it's this day by day thing and you're
Speaker 1: not racking up this like huge four thousand dollar bill
Speaker 1: or two thousand dollar bill at the end of the month.
Speaker 1: You're paying it off every day, so you're actually seeing
Speaker 1: the balance in your account shrink. But you're using it
Speaker 1: a credit card, and you have interesting those perks of
Speaker 1: a credit card without accruing a huge debt that you
Speaker 1: might or might not be able to pay at the
Speaker 1: end of the month. If you want to check that out,
Speaker 1: go to debitize dot com and you can see the details.
Speaker 1: And then the one of the last advantages of using
Speaker 1: our credit card is like the builts in sort of
Speaker 1: rental car insurance, like the purchase protection or like the
Speaker 1: extended warranties and anything like that. I personally have never
Speaker 1: used that. It's been there in case something like that
Speaker 1: word to happen. But but yeah, man, I've never actually
Speaker 1: had to sort of like tap into that feature of
Speaker 1: of of a credit card, so I don't have personal
Speaker 1: experience as far as that goes. I have actually used
Speaker 1: the rental car insurance really in my credit card one time.
Speaker 1: I got a minor accident in South Africa and uh
Speaker 1: and so it came in really helpful save me a
Speaker 1: lot of money. Was it easy? Yeah, it was super
Speaker 1: easy to use too. Yeah. So I would say, look
Speaker 1: at those services that your credit card offers, like trip cancelation, insurance,
Speaker 1: rental card coverage, the extended warranty. So specifically, let's say
Speaker 1: you're buying a television, you want to make sure you
Speaker 1: use the credit card in your wallet that offers a
Speaker 1: doubling of the warranty offered by the manufacturing fu facturer's warranty. Yeah,
Speaker 1: so it's really some of those perks are really neat.
Speaker 1: You just have to remember that they're there and you
Speaker 1: have to meet all the requirements. So, for instance, when
Speaker 1: you're booking a rental car, you have to make your
Speaker 1: initial booking reservation with that credit card and then actually
Speaker 1: pay with that credit card as well. If you don't
Speaker 1: do both, you're not going to be covered. So make
Speaker 1: sure you read the fine print. But there are some
Speaker 1: really cool perks that credit cards offer. Besides just the
Speaker 1: rewards that they tout, there are awesome protections for you
Speaker 1: on top of that. You know, one of my credit
Speaker 1: cards offers like con concierge service, so I could get
Speaker 1: tickets to I know, use it because it sounds fancy.
Speaker 1: It sounds too fancy for me, please, Yeah, But like
Speaker 1: if I really wanted tickets to, like, I don't know,
Speaker 1: Taylor Swift Last a Minute tomorrow night, I don't know,
Speaker 1: I could call them. They don't know. They might have
Speaker 1: the hook up. I have no idea. So that's kind
Speaker 1: of cool. Make sure, you know, look in those fine
Speaker 1: prints and and see kind of what your credit card offers,
Speaker 1: and make sure you're making the right purchases with each
Speaker 1: credit card, because there's some cool stuff. I know. Some
Speaker 1: fancy travel credit cards offer you free admission to airport lounges,
Speaker 1: and that can be really cool perk if you travel
Speaker 1: a lot. Yeah, that would be something good to look
Speaker 1: at I guess if you know you're about to make
Speaker 1: a bigger purchase, uh, somewhere where it would be you know,
Speaker 1: say extra handy, did like Joel said, kind of have
Speaker 1: that extended warranty or you know, like if you know
Speaker 1: you're gonna be traveling, it definitely might be worth looking
Speaker 1: at that card. Obviously, make sure you don't have a
Speaker 1: foreign transaction fee um associated with that card when you're
Speaker 1: when you're traveling. But yeah, man, I couldn't imagine being
Speaker 1: in another country and then get it getting an erect
Speaker 1: like having that extra insurance essentially see valuable. Yeah. And
Speaker 1: I want to say too that at some point I
Speaker 1: hope to get into like the travel hacking thing. And
Speaker 1: I know there's a lot of people that are super
Speaker 1: into travel hacking and using credit cards, essentially opening a
Speaker 1: credit card, taking the perks and the sign up bonuses,
Speaker 1: and booking a whole trip for their family for fifty
Speaker 1: dollars or less, and and that's really cool and I
Speaker 1: love that idea. For me, I'm just not brushed up
Speaker 1: enough on that and not interested in brushing up enough yet.
Speaker 1: But hopefully, you know, at some point when I have
Speaker 1: more free time, I look look forward to using credit
Speaker 1: cards for stuff like that. Yeah, And I love that idea,
Speaker 1: but I'm just not there yet. Yeah. Yeah, same here, man.
Speaker 1: I look forward to the day when I have to
Speaker 1: do all the mile researching because that means I'll be
Speaker 1: traveling a lot more and have a lot more time.
Speaker 1: Don't quite have that at the moment. Yeah, with you've
Speaker 1: got three young kids. I've got two young kids. Were
Speaker 1: just traveling once a year, and you know, if we're
Speaker 1: lucky right now, not doing much jet setting with our
Speaker 1: with our kids in tow. Yeah. So let's talk about
Speaker 1: some of the cons of using a credit card real quick, Matt. Yeah,
Speaker 1: those were all the pros that we just covered, you know,
Speaker 1: every all the advantages and benefits of using a credit card.
Speaker 1: And there's definitely some some cons, some things that we
Speaker 1: need to be wary of, make sure we're not getting
Speaker 1: hammered or paying more than we need to be paying. Yeah. Man.
Speaker 1: One of the first I put this in parentheses cons
Speaker 1: is annual fee credit cards. And so there are a
Speaker 1: lot of credit cards that charge you an annual fee.
Speaker 1: And I will say for most people it is a
Speaker 1: con because they're not getting their money's worth. They might
Speaker 1: be paying annual fee and they're not making their money
Speaker 1: back because they're not using their rewards properly. Yeah. A
Speaker 1: lot of times those those annual fees are associated with
Speaker 1: cards that have slightly higher cash back, and you think,
Speaker 1: oh man, that'll totally be worth it. But in a
Speaker 1: lot of those cases, sometimes those will be business cards
Speaker 1: or just sort of these fancy personal cards, and you
Speaker 1: need to be spending a lot of money on that card.
Speaker 1: The fact is you don't need to be encouraged to
Speaker 1: spend more money just to make sure you're getting your
Speaker 1: money is worth out of your annual fee card. There's
Speaker 1: something kind of messed up and twisted about that thinking
Speaker 1: that like, oh man, I gotta make sure it's worth
Speaker 1: it for me to keep this card with an annual fee.
Speaker 1: Therefore I need to spend extra money so I get
Speaker 1: the extra rewards and slippery slope, Yeah that you just
Speaker 1: don't do that. Yeah. So I mentioned my Southwest card
Speaker 1: that I got that will, when we book on a sale,
Speaker 1: give us probably four round trip tickets pretty easily across
Speaker 1: the country for our family, which is awesome. That's like
Speaker 1: the reason I got it, because I had it in
Speaker 1: mind I'm going to book tickets to go see my
Speaker 1: family in the Northwest, and it carries an annual fee,
Speaker 1: but it's worth it because I know what I got
Speaker 1: from signing up, and after I book those tickets, I
Speaker 1: might cancel it. Yeah. Oh, man, absolutely, that's kind of
Speaker 1: my m O. Like it's the same thing. Like if
Speaker 1: there's a card that I'm going to sign up for
Speaker 1: that has a really sweet sign up bonus, like one
Speaker 1: specifically that I recently redeemed and got eight fifty bucks
Speaker 1: cash cash back. Man, that's huge. Granted that card had
Speaker 1: a nine dollar annual fee, and so I just gotta
Speaker 1: take that into accountans in reality is not eight fifty
Speaker 1: it's more like seven fifty. But even still, that's the
Speaker 1: biggest cash back sign u bonus that there is out
Speaker 1: there right now. And if you can just keep that
Speaker 1: in mind and take that into account when you're weighing
Speaker 1: the benefits out there, sometimes annual fee isn't a huge
Speaker 1: deal as long as you're aware of it. Yeah. Another
Speaker 1: con of using credit cards is your tendency to overspend,
Speaker 1: and that's been well documented throughout the years. Using plastic
Speaker 1: just doesn't register with our brain in the same way
Speaker 1: as handing over physical bills and change. And so if
Speaker 1: you're not able to control your spending when you're using plastic,
Speaker 1: like we talked about earlier, I think you really need
Speaker 1: to consider going to a cash system. I mean, I
Speaker 1: think credit cards are great for a lot of reasons,
Speaker 1: but if you know yourself in particular, you know you
Speaker 1: can't handle it, then moving not even just to a
Speaker 1: debit card, but moving to cash could be the way
Speaker 1: for you to pay for most things. Yeah man. And
Speaker 1: so then another con I guess that I want to
Speaker 1: touch onto is sort of the trap of paying for
Speaker 1: your purchases from yesterday, like yesterday's purchases tomorrow. And what
Speaker 1: I mean by that is thinking that, like cool man,
Speaker 1: there's something I want to get like today, like right now,
Speaker 1: but I don't quite have the money. Like people know
Speaker 1: that it takes close to a month before that charge
Speaker 1: shows up on the statement, you know, like once your
Speaker 1: monthly statement comes in, I'm gonna buy that coach purse,
Speaker 1: yeah yeah, or the Atlanta United Jersey. Yeah that's more
Speaker 1: like uh, and I want them for for a month
Speaker 1: and a half. It's gonna be awesome. I'll have the
Speaker 1: money back by then. They're about the same price too. Yeah, yeah, exactly,
Speaker 1: and then it's another month almost before that statement is
Speaker 1: even due. And so basically you're making charges today assuming
Speaker 1: that you'll have the money you know, in the future.
Speaker 1: But like for us, are income fluctuates. Someone might be
Speaker 1: out of work or something like that, you know where
Speaker 1: where they don't have the or even other expenses that
Speaker 1: come up. There's just other things that that kind of
Speaker 1: come up. And so when you put yourself on that
Speaker 1: cycle of of being anywhere between thirty and sixty days
Speaker 1: sort of removed from that purchase, I just feel like
Speaker 1: that's sort of another slippery slope where you can essentially
Speaker 1: just end up overspending. Yeah, no doubt. And that's a
Speaker 1: common reason that people get into a lot of credit
Speaker 1: cards because they think, I can make this purchase now
Speaker 1: and pay for it. It'll be fine a couple of
Speaker 1: months from now, and I will have the money. But
Speaker 1: if you think that way about too many purchases, you're
Speaker 1: not gonna have the money in two months, and so
Speaker 1: that's that's a huge issue. And then it becomes just
Speaker 1: this sick cycle that repeats itself. And in the same
Speaker 1: way that you know, putting your money into an investment
Speaker 1: account or that compounding interest makes such a huge difference
Speaker 1: to your bottom line over time. The same thing happens
Speaker 1: in the opposite direction with credit cards. Can I get
Speaker 1: stuck in that opposite cycle? Well, let's say you're just
Speaker 1: paying the minimum payment every month. If you look at
Speaker 1: your statements, it tells you if you pay the minimum payment,
Speaker 1: it might take you thirty seven years to pay off
Speaker 1: this debt. And that's like legitimately, it could say thirty
Speaker 1: seven years forty s I it could be forever if
Speaker 1: you're only paying the minimum payment. Essentially, if you're paying
Speaker 1: the minimum payment allowed by your credit card issue every month,
Speaker 1: you're accruing interest. Your balance is not being cut down significantly,
Speaker 1: and you're going to be in debt for such a
Speaker 1: long period of time. It's not even funny. Yeah, indefinitely. Yeah.
Speaker 1: And so that sort of mentality when it comes to
Speaker 1: using a credit card actually means you're you're not fit
Speaker 1: for using a credit card and you need to really
Speaker 1: consider moving to cash or UH and and doing that
Speaker 1: taking that focused approach towards your debt, like we talked
Speaker 1: about earlier on Yeah man, and like the way we
Speaker 1: use credit cards is we literally pay them off, you know,
Speaker 1: at the end of every month. Essentially what you're that
Speaker 1: new app that you're talking about does, which I'm totally
Speaker 1: gonna look into you because that's like right up my alley. Um,
Speaker 1: but yeah, I mean, we track our expenses every month
Speaker 1: and then literally on the you know, after the last
Speaker 1: day of the month, um, I schedule a payment for
Speaker 1: all the charges for that month. And that's before you know,
Speaker 1: the statement even rolls in. Because for us, I just
Speaker 1: want to make sure that we're on top of our expenses, um,
Speaker 1: that we're sort of don't have this backlog of of
Speaker 1: charges that we owe, and it just helps us to
Speaker 1: stay on top of things and stay organized. Yeah, and
Speaker 1: that's a great tactic for people to ensure they're using
Speaker 1: their credit card wisely is to pay before the statement
Speaker 1: even comes in. And it's really easy to do that online.
Speaker 1: Essentially choose the date at the end of the month,
Speaker 1: like you said, or or figure out a system that
Speaker 1: works for you. But whatever you have to do to
Speaker 1: minimize your chances of getting into recurring credit card debt,
Speaker 1: you want to do. And that's a great tactic for
Speaker 1: ensuring that you never fall down that path. Alright, So
Speaker 1: let's talk about how many credit cards should people have, Matt,
Speaker 1: and what should those credit cards consist of. We already
Speaker 1: kind of talked about how we like cash back cards,
Speaker 1: but how many credit cards do you think the typical
Speaker 1: person should have? I have like currently open, like five. Yeah,
Speaker 1: five is a good number. I think it's good. I
Speaker 1: don't know. I think average person anywhere between three and five.
Speaker 1: And that's because of the credit utilization rate that we
Speaker 1: talked about in our how to Approve Your Credit Score
Speaker 1: podcast episode, which you can check out. But I think
Speaker 1: there's a few reasons that you want multiple Let's say
Speaker 1: your credit line gets reduced or credit card gets canceled
Speaker 1: because you're not using it enough. You want to make
Speaker 1: sure you have other lines of credit available to you, uh,
Speaker 1: and you you don't want to be essentially s O
Speaker 1: l when it comes to having a credit card that
Speaker 1: you can use. The other thing is I think you
Speaker 1: want to be able to maximize rewards. So I think
Speaker 1: for the person that is really really lazy about it,
Speaker 1: and I would I would put myself like just a
Speaker 1: little bit above that on the scale of using credit cards.
Speaker 1: So most of my usages I go to the two
Speaker 1: percent card, but I have a couple of others that
Speaker 1: I know that I can use for certain things. So
Speaker 1: I use the Costco card. That's one of my other
Speaker 1: main cards that I use, and I'll tell you why.
Speaker 1: It's because I can get four percent cash back on gas,
Speaker 1: so I always use it when I get gass, three
Speaker 1: percent cash back on restaurants and travel, so I always
Speaker 1: use it when I go out to eat or when
Speaker 1: I'm doing travel stuff, and two percent back when I
Speaker 1: go to Costco. So obviously I always use it at Costco,
Speaker 1: and then for everything else, I use my two percent card.
Speaker 1: That's just kind of my one leg up to on
Speaker 1: some purchases I make a little bit more than two percent.
Speaker 1: But I think for most people, you know, if you've
Speaker 1: got twelve cards and you're trying to figure out which
Speaker 1: card do I use it the supermarket, which card do
Speaker 1: I use for booking travel stuff? That that gets a
Speaker 1: little like, at least for it's too much mentally, and
Speaker 1: so I try to keep it simple with literally three
Speaker 1: credit cards that I cycle back and forth between. But
Speaker 1: I think anywhere between three and five is probably a
Speaker 1: good number for you for a bunch of different reasons.
Speaker 1: And just make sure you can have a simple enough
Speaker 1: method of knowing when to use them so that you
Speaker 1: can do it the right way with every purchase consistently. Yeah,
Speaker 1: I mean the biggest thing there is just to not overcomplicated.
Speaker 1: It's not like we're making bank Like you're not making
Speaker 1: a ton of money with these different bonuses in the
Speaker 1: cash back. This isn't a way to create an income.
Speaker 1: This is a way, do you know, just have like
Speaker 1: a nice little bonus the end of the month or
Speaker 1: at the end of every every few months. So for
Speaker 1: the longest time for us, we've had essentially two main
Speaker 1: cards that we use. We kind of have like our
Speaker 1: main go to card that we use for like in
Speaker 1: person purchases, so if you go to the store and
Speaker 1: you know when we're handing the card over in person,
Speaker 1: but then for all like essentially like utilities and online
Speaker 1: purchases and things like that, we kind of have this
Speaker 1: other like a separate card. From my standpoint, like keeping
Speaker 1: up with finances, it helps me to sort of mentally
Speaker 1: organize what purchases are aware that being said, and I
Speaker 1: have recently signed up for like a new sort of
Speaker 1: sign up bonus card though that's when I hit that
Speaker 1: one card hard across the board. You got two man,
Speaker 1: you got to meet those requires. Yeah, yeah, because sometimes
Speaker 1: they're pretty step. You know, they can be like four
Speaker 1: to five tho dollars in three months, and it can
Speaker 1: be like kind of tough because we can try to
Speaker 1: live pretty frugally and so I have to try to
Speaker 1: make sure I get a bunch of business expenses on there,
Speaker 1: and uh yeah, I gotta gotta hit that quota. But
Speaker 1: in those instances, though, I really like having that single
Speaker 1: card because it's super easy, incredibly simple, laser focused. We're
Speaker 1: using this one card for everything, and we get the
Speaker 1: cash back. But then on top of that, like I said,
Speaker 1: you know, you get get that sign up bonus anywhere
Speaker 1: between like three and in some cases even even eight
Speaker 1: hundred or eight hundred fifty bucks. Yeah. And I think
Speaker 1: one other quick point is you'll probably want to get
Speaker 1: a Visa and a MasterCard, any sort of mix of
Speaker 1: the three major credit card companies Visa, mess Card, AMEX. Yeah,
Speaker 1: you want to get different logos on on a couple
Speaker 1: of different cards just because of where credit cards are accepted,
Speaker 1: and just make sure you have one Visa, one master Card,
Speaker 1: one Visa one American Express. You know, whatever suit, your
Speaker 1: your your needs. Just make sure it's not three visas
Speaker 1: just just in case, or three amex Is or three
Speaker 1: Discover cards. Yeah. Yeah, it's like we don't take Discover
Speaker 1: but that's all I have. Yeah, that's not good and
Speaker 1: real quick, Matt, let's touch on closing a credit card. Yeah,
Speaker 1: we just admitted that we close credit cards, right. I
Speaker 1: think that if you are getting one for the sign
Speaker 1: up bonus only essentially, and you're done with it, You've
Speaker 1: used the bonus and you're done with it, and you
Speaker 1: don't want to pay that annual fee, that's a decent
Speaker 1: reason to close the credit card. I think for the
Speaker 1: most part, closing credit cards is a bad idea, and
Speaker 1: you don't want to close them for no reason. The
Speaker 1: annual fee really is, in my mind, the only good
Speaker 1: reason to close the credit card. Yeah, man, I completely agree.
Speaker 1: I'm not gonna pay that annual fee. You know, I'm
Speaker 1: not gonna pay a hundred bucks a year just to
Speaker 1: have this card if I'm not gonna reap some huge reward.
Speaker 1: So when the time comes, I I really do close it.
Speaker 1: Though you know we cover this in the Credit Score episode.
Speaker 1: The length of credit history like that only makes that
Speaker 1: fifteen per cent of your entire score, and so you know,
Speaker 1: you close a card that portion of your credit score
Speaker 1: that might drop a little bit, and you know you'll
Speaker 1: see a change on your credit score, but it'll rebound
Speaker 1: pretty quickly. That's not gonna impact you, like say, over
Speaker 1: utilizing your credit cards. Yeah, just make sure you know
Speaker 1: what you're doing when you're playing the game, because you
Speaker 1: want to make sure your credit utilization rate is not
Speaker 1: an impacted greatly and that your age of credit history
Speaker 1: is an impacted greatly by closing a card. If you're
Speaker 1: closing one, make sure you have three others right that
Speaker 1: have low balances. Sure, you're gonna want to make sure
Speaker 1: that you know what you're doing when you close the
Speaker 1: card and that you already have a good score. And yeah,
Speaker 1: I mean that's not something you want to do, especially
Speaker 1: when you're if you're considering taking out a new loan,
Speaker 1: say for a new home or something like that. A
Speaker 1: lot of times I've found from personal experience that it's
Speaker 1: tough to know what exactly is going to happen to
Speaker 1: your credit score, and so it kind of just takes
Speaker 1: some messing with it. It sounds kind of funny to say,
Speaker 1: but it's not really that big of a deal, like
Speaker 1: it's constantly changing. Just make sure you're not trying to, say,
Speaker 1: apply for a new mortgage for your first home something
Speaker 1: like that, where if your credit score drops some a
Speaker 1: few points where you would be more negatively impacted. Yeah,
Speaker 1: and just make sure you're not messing with it, like
Speaker 1: Matt said, at a point where you're gonna need it,
Speaker 1: to need it exactly at it's very best. So you
Speaker 1: know what, Hey, I'm getting a mortgage in two months,
Speaker 1: or I'm applying, but you know what I'm gonna I'm
Speaker 1: gonna do this credit card hack real quick and sign
Speaker 1: up for this awesome bonus and then cancel it next week. Yeah,
Speaker 1: I want to do five credit card hacks, sign up
Speaker 1: for all of them and drop them all. That's that's
Speaker 1: something you don't want to do, right, Yeah, And it's
Speaker 1: totally fine if you're completely settled in your house you
Speaker 1: don't need access to any credit anytime soon. Your credit
Speaker 1: score doesn't really mean much to you. But if you're
Speaker 1: even close to thinking about getting a loan for anything,
Speaker 1: you don't want to take part in this. So just
Speaker 1: make sure that you're wise when it comes to closing
Speaker 1: your credit card because your credit score matters for a
Speaker 1: lot of reasons and you don't want to negatively impact it,
Speaker 1: even in the short term unless you really know what
Speaker 1: you're doing. Cool man, Let's uh, let's go ahead and
Speaker 1: get to some Facebook questions now, Like right before we
Speaker 1: sat down to record, I'll it's passed up a post
Speaker 1: up in our group and uh, a bunch of folks
Speaker 1: have commented, which is totally awesome. So let's let's get
Speaker 1: to some of these questions. See what folks are saying.
Speaker 1: All right, Brian mentioned not a question but a statement,
Speaker 1: and it's an awesome one. He says, we put all
Speaker 1: of our expenses on a credit card that we can
Speaker 1: and pay the bill monthly. We gotta be disciplined. We
Speaker 1: have a U. S A A limitless cash back card,
Speaker 1: and we earned two and a half percent back on
Speaker 1: all purchases. And Brian, I'll be honest, I hadn't heard
Speaker 1: of this card. Sweet. I looked it up. It's pretty neat.
Speaker 1: It is better than even the two percent cards we
Speaker 1: were talking about. So if you are a U. S
Speaker 1: A A member and direct deposit your paychecks into their bank,
Speaker 1: you can get this USA A limitless cash back card
Speaker 1: and earned two and a a half percent back on everything.
Speaker 1: That's pretty sweet man. And then Zach wrote in, Matt,
Speaker 1: and to talk about something we just talked about. He said,
Speaker 1: when should you cancel the credit cards? Should it be
Speaker 1: based on time, minimal use or when a better deal
Speaker 1: comes along? I mean, yeah, we essentially just kind of
Speaker 1: talked about that. But for a quick recap, if you
Speaker 1: don't have an annual fee, keep it open. It will
Speaker 1: help you maintain a low credit utilization rate, which is
Speaker 1: great for your credit at score. And it's always kind
Speaker 1: of there if you want to be able to take
Speaker 1: advantage of maybe a sweet promotion that they're doing. Hey,
Speaker 1: and the only reason to cancel is an annual fee
Speaker 1: where you feel like you're not getting to benefit from
Speaker 1: the card. And even in that you need to be careful,
Speaker 1: right like we talked about all right, Matt. Also, Josh
Speaker 1: Ordening said, should I pay off all my credit card
Speaker 1: debt before saving for a down payment on a house
Speaker 1: or should I try to do both? And if my
Speaker 1: rent is lower than my mortgage would be, should I
Speaker 1: stay where I am until I'm at least credit card
Speaker 1: debt free? So those are yeah, two separate questions. The
Speaker 1: first one should if you have credit card debt before
Speaker 1: saving up for a house, And I think to that
Speaker 1: one we we would both say yes. I mean, it's
Speaker 1: typically credit card debt. I mean, if you have anything
Speaker 1: lower than that you're paying to a credit card, you've
Speaker 1: got a great credit card. But it doesn't even matter
Speaker 1: if it's if you're paying ten percent to a credit card,
Speaker 1: you want to get rid of that. That's I mean,
Speaker 1: that's a high interest rate. You're not going to do
Speaker 1: better than that in savings. So yes, exactly, and you're
Speaker 1: definitely not going to do better than that when it
Speaker 1: comes to seeing equity growing a home. Uh So, first
Speaker 1: things first, pay off that credit card, and I think
Speaker 1: you'll be shocked and surprised at how quickly you are
Speaker 1: then able to save up for a down payment on
Speaker 1: a house. And I think his second question actually reinforces
Speaker 1: what we just said, because his rent is lower than
Speaker 1: his mortgage. If your rent is lower than what a
Speaker 1: mortgage would be where you're buying, you should strongly consider
Speaker 1: continuing to rent because of the costs that are associated
Speaker 1: with buying a house and then maintaining a house. If
Speaker 1: you're happy renting and you're happy where you are, and
Speaker 1: you're in a good situation, and the rent is reasonably low,
Speaker 1: which it sounds like it is where you are. I
Speaker 1: think renting is the best option there, and Matt really
Speaker 1: soon on the podcast, we definitely need to cover the
Speaker 1: age old debate of renting versus buying. Yeah, man, there's
Speaker 1: nothing wrong with renting. You know, live that rent life.
Speaker 1: That's pretty nice, not have to worry about doing all
Speaker 1: those household things that. Yeah, we could, we could talk
Speaker 1: a whole episode about that that alone. Yeah, we'll do
Speaker 1: that real soon. So yeah, Josh, I would say, pay
Speaker 1: off your credit card at first, and stay in that
Speaker 1: rental that's reasonably cheap, and eventually, you know, you'll find
Speaker 1: the time to get into that house of your very own.
Speaker 1: But now it sounds like it's not quite the right time.
Speaker 1: All right, Joel, let's get back to this beer. I
Speaker 1: feel like we like all the beers that we have
Speaker 1: on here. I haven't really had bad words to say
Speaker 1: about almost any of the beers we've had, but I
Speaker 1: think it's because we carefully select and we picked good beers.
Speaker 1: I mean, thanks to Boulevard for sending this one. This
Speaker 1: is uh really tasty. I'm a huge fan. I mean
Speaker 1: it really is in that if you've had some of
Speaker 1: the older love Child's, it's right in that vein. It's
Speaker 1: like a freaking sibling of the ones that came before it,
Speaker 1: and it's it's it's beautiful of the previous Love Child
Speaker 1: Love Child before that. It's delicious. Man. I really love
Speaker 1: how sour it is. It's it's heart. Yeah, it really
Speaker 1: has a great tartness to it. It's still fruity, though.
Speaker 1: This is nice and well balanced and rounded and that's great. Yeah,
Speaker 1: and enough of that funk that kicks in that it's
Speaker 1: not just sour. It kind of gives it like a
Speaker 1: well roundedness. It's got some interest to it other than
Speaker 1: just sourness. Yeah. So Love Child number eight you can
Speaker 1: probably get it in your local bottle shop and maybe
Speaker 1: your maybe your local grocery store. Fancy your grocery store. Yeah,
Speaker 1: you're not gonna be able to pick this up at
Speaker 1: Aldi No, well, no, definitely not. And actually, uh, you know,
Speaker 1: one of our listeners wrote us a note the other
Speaker 1: day said that Aldie actually has a good beer. So Matt,
Speaker 1: we're gonna test that out. Do you remember what it was?
Speaker 1: I don't remember, but I'll look it up. Maybe we'll
Speaker 1: give it a shot on a future show, because I
Speaker 1: do kind of like the idea of drinking beers that
Speaker 1: a lot of other people out there can get, and
Speaker 1: so we'll try to do that more and more, um
Speaker 1: so that if you hear about the beer that we're
Speaker 1: drinking and you you want to partake that, you can,
Speaker 1: you know, run out to your local shop and grab it.
Speaker 1: All right, MAT's a quick recap. Using your credit cards
Speaker 1: like a pro. Yeah, man, The first thing you need
Speaker 1: to make sure you're doing is paying off your card
Speaker 1: every single month. You do not need to be carrying
Speaker 1: a balance. You do not need to only be making
Speaker 1: the minimum payments. The credit card companies are are working
Speaker 1: you like a pro. When that's the case. If you're
Speaker 1: not doing that, do not pass go, do not collect
Speaker 1: two hundred dollars. Go back to square one. Pay off
Speaker 1: your balance every month, and until you can get there,
Speaker 1: the rest of the things don't matter. But assuming you've
Speaker 1: already done that, there's some sweet advantages and then pros
Speaker 1: to to using credit cards, the first of which is
Speaker 1: cash back. Man, you can get some sweet little bonuses
Speaker 1: at the end of the end of the month or
Speaker 1: end of every couple of months, and maybe even a
Speaker 1: sweet bonus for signing up. Another pro the credit cards
Speaker 1: are easier to track than cash spending, and so cash
Speaker 1: my curb your spending, but using a credit card can
Speaker 1: be really helpful for seeing where your money goes, tracking
Speaker 1: it either on your balance sheet that comes in the
Speaker 1: mail or online every month, or tracking it through an
Speaker 1: app like Mint. Using a credit card just makes it
Speaker 1: really easy to see exactly where your money is going. Yeah,
Speaker 1: especially helpful if you're trying to create a budget for
Speaker 1: the first time. There are constant credit cards too, and
Speaker 1: even someone who's using a credit card like they should
Speaker 1: be used. A con could be an annual fee. And
Speaker 1: so if you're spending seventy or more dollars a year
Speaker 1: on an annual fee, but you're not getting the bang
Speaker 1: for your buck when it comes to rewards, you might
Speaker 1: want to consider closing that credit card, I mean, and
Speaker 1: another downside to using credit cards is the tendency to overspend.
Speaker 1: Instead of feeling you know the bills your cash leave
Speaker 1: your wallet when you use plastics, sometimes you don't feel
Speaker 1: it as much. So if you're not tracking and keeping
Speaker 1: up with your expenses. Uh, it's really easy to to
Speaker 1: overspend and even blow through your budget. Yeah, it's tough
Speaker 1: for to see a clean, crisp greenback fly out of
Speaker 1: your fingers than it is to just slide or insert
Speaker 1: your credit card. Really, yeah, man, consider paying off your
Speaker 1: credit card not at the end of every billing statement,
Speaker 1: but literally at the end of every month. We found
Speaker 1: that that's incredibly helpful for us to stay on top
Speaker 1: of our expenses. We don't fall behind that way. And
Speaker 1: if it's kind of tricky for you to keep up
Speaker 1: with them, check out that app that Joel mentioned. It's debitized,
Speaker 1: which is d E B I T I Z, which
Speaker 1: sounds awesome And I literally I'm totally gonna check that
Speaker 1: out because that that sounds like something right up my
Speaker 1: alley might be a way to for us to simplify
Speaker 1: our life. And another tip, how many credit cards should
Speaker 1: you have? Well, probably between three and five. Yeah, that's
Speaker 1: for your credit utilization rate and just in case one
Speaker 1: of your credit cards gets canceled, you want to make
Speaker 1: sure you have enough lines of credit available to you.
Speaker 1: And on top of that, you can maximize your rewards
Speaker 1: by having you know, between three and five you have
Speaker 1: specific credit cards for specific usages like I mentioned having
Speaker 1: a two percent cash back card for everyday purchases, and
Speaker 1: then having other credit cards that give you higher amounts
Speaker 1: that specialize in certain things. But don't overdo it, because
Speaker 1: you want to make sure that your system is easy
Speaker 1: enough that it's not going to annoy you, and so
Speaker 1: you're gonna actually be able to use your credit cards
Speaker 1: properly for maximum benefit. All right, thanks to everyone for listening.
Speaker 1: Our home on the web is how to money dot com.
Speaker 1: Check it out. We'll have some show notes up there
Speaker 1: for you. Yeah, we'll link to things like debtize and
Speaker 1: some of the credit cards that we think are best.
Speaker 1: And until next time, Joel, best friends Out, Best Friends Out,