Hi Money Minder,
Hey there! I don’t have any credit cards at the moment. Just dealing with the usual bills like mortgage, auto insurance, phone, internet, and gas/electric. Fortunately, I make enough money to cover all these expenses, plus gas and food. I was thinking about grabbing a cash back card to make things easier.
So, my plan is to set up automatic payments from the card for all my bills. That way, I don’t have to worry about multiple payments throughout the month. I’ll just pay it off once a month and avoid any nasty interest charges. Plus, why not earn some cash back on money I’m already spending?
Now, here’s where I need your advice. Should I just pay off the card in full every month? Or should I have a specific amount automatically deposited into another account, set up auto payments to the credit card for slightly less than that amount, and then chip in the remaining small sum from my main account? Or maybe there’s another trick up your sleeve to make my money work harder for me? (Just so you know, I’m already taking advantage of all the perks my credit union has to offer).
Looking forward to your insights!
Fondly,
Seeking Advice
Response from THE MONEY MINDER:
Hello There,
Firstly, congratulations on considering the idea of getting a cash back credit card to manage your expenses more efficiently. It sounds like you have a solid grasp on your finances and the discipline to pay off your balance in full each month to avoid any interest charges, which is a great approach.
In terms of setting up your payments, automating them through the cash back credit card and then paying it off in full monthly is indeed a smart move. This will streamline your bill-paying process and allow you to earn cash back on your regular expenses. As for the strategy of setting a direct deposit into another account and having automatic payments from the credit card, followed by a manual payment for the remaining balance, it can be a viable option to ensure you always have enough funds to cover the card’s bill.
In terms of making your money work for you, besides earning cash back with a credit card, you could consider building an emergency fund or investing in a high-yield savings account or retirement fund. These options can help you grow your savings or prepare for unexpected expenses in the future.
Ultimately, the key is to find a balance that works best for your financial goals and lifestyle. By utilizing a cash back credit card responsibly and exploring other beneficial avenues like saving or investing, you can maximize the potential of your money. Remember to keep track of your spending, stay within your budget, and continue to monitor your financial progress.
Farewell from THE MONEY MINDER.
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