Does having a reward/cashback card make you spend more?

MrNickel

YorkshireBoy wrote: »

Best to keep purchases and 0% BTs on separate cards, as you won't be able to avoid paying interest on purchases if you don't completely clear the entire balance each month.

I am not sure that is right. All credit cards now apply any payments to the amount attracting the highest interest before anything else, so you can pay off the purchases without denting the BT as any payment would be used to pay off that interesting bearing amount as a priority.

You would have to work out the amount to pay manually of course, which is the downside.

YorkshireBoy

MrNickel wrote: »

I am not sure that is right. All credit cards now apply any payments to the amount attracting the highest interest before anything else, so you can pay off the purchases without denting the BT as any payment would be used to pay off that interesting bearing amount as a priority.

But because you didn't pay the previous bill in full, you forfeit the "up to xx days interest free" benefit on purchases. So you can't avoid interest on said purchases. From the Halifax card T&Cs (condition 4.4 1st bullet)...

We will not charge interest on Purchases shown on your current statement if you pay the full balance shown on that statement by the payment date (provided you have also paid the full balance on the previous statement by the payment date). If you have not previously paid in full, we’ll add interest on those Purchases to your statement and we’ll charge that interest from the date we originally added the Purchases to your account.


http://www.halifax.co.uk/creditcards/help-guidance/terms-and-conditions/balance-transfers-and-purchases/

symphonies

No, I personally don't spend more than I normally would just because I'm using a cashback/rewards card. That's what the credit card companies want you to do.

Because if you're impulse buying for the sake of points/cashback then you're losing out in the end because what you gain from those rewards is tiny compared to the astronomical cost of the things you're buying.

I actually have the Freedom Rewards too (hoping to upgrade this to their cashback one soon!) and personally, I get a lot of satisfaction when I use my card for big spends like flights and hotels. I tend to put my normal spending on to it as well - the odd coffee, petrol, supermarket shopping and regardless of whether I had a cashback card or not, I would still be buying these things.

If you can't help but spend, it might be better to get rid of the card and stick to a regular, 'no perks' card.

Jdzia3

I am registered with a an organisation that gives me cashback (CB)and shopping points (SP). I understand what you're saying, but you have to be disciplined at all times.

I budget and plan my weekly shopping.....last year -2014, I accumulated CB & SP to the sum of £1700.

Jdzia3

zoe55 wrote: »

Hello!

Long time lurker, first time poster!

Regarding the title, I'm genuinely curious. About a year ago, I was accepted for a Barclaycard Freedom Rewards. The points system is a bit pants. You need loads to get a £5 voucher. Anyway, I just figured I'd use it for all spend. What I didn't realise was that my spend was increasing more and more each month. Every time I saw my Freedom points increase, I'd spend more on my card and justify purchases by thinking, 'ooh, I'll get me points.'

A year later and my closet is bursting and my clothes are all telling me I've dined out one times too many. When the thought first occurred to me, I thought 'oh good. I can purchase a gym membership with my Barclaycard and get points' and then I realised how wrong my thinking was and that I'd better get rid of the card before I do any more damage.

I have one other credit card and I have never abused it the way I have this one. I think the promise of points encourages me to spend more.

I want to go away to Europe for a week's break later on in the year and I'm already thinking about the ton of points I'll accumulate by booking my hotel and flights through lastminute.com through the Barclaycard Freedom Rewards store. But then I think I definitely need to get rid of the card now. (At least I always clear it in full - which is the ONLY good thing about this sorry post!)

Does anybody else have this problem? Or am I just an idiot?

JDZIA3

I am registered with a an organisation that gives me cashback (CB)and shopping points (SP). I understand what you're saying, but you have to be disciplined at all times.

I budget and plan my weekly shopping.....last year -2014, I accumulated CB & SP to the sum of £1700.

londonsaver86

No it will never make you spend more.

But it will definitely make you put more on the reward card.

Sometimes when using Amex gold, you get double points on travel for example. but a lot of airlines charge a fee for use of amex. In these cases you just have to weigh up the options and make sure you don't end up paying fees just for points (stupid!!).

Jdzia3

Well, it should not increase your spending. ...you need to change your attitude towards the loyalty - you are ONLY to spend 1) if you have the funds to hand, and 2) is it a NEED or WANT?

It's very important to plan and budget for ALL your shopping.

What we tend to do is just save all our rewards/points and spend them at Christmas...to date, for 2015 we've already accumulated £4500.00 worth of cashback.....

Candyapple

Jdzia3 wrote: »

Well, it should not increase your spending. ...you need to change your attitude towards the loyalty - you are ONLY to spend 1) if you have the funds to hand, and 2) is it a NEED or WANT?

It's very important to plan and budget for ALL your shopping.

What we tend to do is just save all our rewards/points and spend them at Christmas...to date, for 2015 we've already accumulated £4500.00 worth of cashback.....

£750 per month in cashback, pray tell what is this wizardry?

Jdzia3

We are registered with a an organisation that gives us cashback (CB)and shopping points (SP). Registration is free, but the responsibility of organising your shopping habits/visits to the stores to acquire the CB & SP is YOURS (this is where most people miss the hurdle!!!). In our household the Shopping list is compiled every week, we do the bulk shopping once or twice a week...there are certain items that get bought in bulk once a month or once every 3 months....in time, a habit/routine is formed and CB & SPs gradually starts to increase...this is in addition to using the Clubcard, Advantage Card & Match & More etc.....

The key is to budget and plan the family weekly/monthly shopping..