I knew it had to end sometime. It was 2006, gas prices had peaked above $3.00, and I was laughing each time I left the station. It was partly due to my car getting over 30MPG, but mostly because of my credit card (here’s a link, but I am no longer recommending this card). My Citibank Dividend Rewards card earned me 5% cash back on gasoline and groceries, which meant I was essentially getting 15 cents off each gallon of gas. Once I earned over fifty dollars, I simply requested a check from their website, and reimbursement arrived at my door in under 7 business days. Unfortunately, as gas prices continued to rise to over four dollars a gallon, Citibank cut their rewards package from 5% to 2%. They recently cut it again to 1%, eliminating any advantages to using the card, and prompting my search for a new one. The credit card market is no longer the idyllic consumer-favorable environment it used to be. This doesn’t mean you can’t find an awesome rewards plan, you just have to work a little harder for it.
Carrying a Balance = No Rewards
For some people, credit cards result in more damage than good. Studies have shown the average college graduate has thousands of dollars in credit card debt, and these people are the academically-superior minority! A credit card may serve well as a means of short-term credit in emergencies, but it should never be used regularly for this purpose, and it should be a personal financial goal to prevent these emergencies from happening. Still, there are a few advantages to credit cards that work exclusively in your favor: