Do you think cashback makes you spend more (or otherwise disrupts a budget)?

upoiupou

I have a credit card with cashback but have decided it's not worth using because I don't spend enough! I would use it for a large purchase but I'm not making any (I'm on a strict budget).

Obviously, I'd still get something if I used it for small purchases like food and fares, but I decided it wasn't worth it overall. One reason is that I'm tempted to spend more when I use a credit card. I do much better staying frugal when cash has to go through my hands. Another reason is that having spent money but still seeing it in my savings account doesn't help my motivation to economise. Again, I'm better at being frugal when things are more immediate and real.

I realise this is all in my head and I'd get a few extra pennies if I used the card, but I prefer to let that go in exchange for finding it easier to keep to my budget.

I'm curious if other people experience something similar, or manage to be completely hard-headed about it and spend the same as they would if it was cash.

elsien

I don't find I spend more. I mainly pay for petrol and food on it, which I'd be spending anyway as my job involves a fair amount of driving.
As far as food goes, I have a credit card repayment pot. I take out a certain amount of cash for the weeks food shop, and if I spend on the card the amount comes out of the cash amount and into the credit card pot. Might seem convoluted, but that way I can see real money vanishing which removed the temptation to overspend.

concernedSaver

Well, probably the average MSE fan will make the cashback work in his favour, choosing the best credit card as a tool to spend money already allocated on a budget.

But obviously, in the grand scheme of things, credit card companies must have find cashback and rewards quite effective in encouraging people to get more in debt. The meagre percentage awarded to us in cashback or air miles come straight from someone else's interests repayments.

chattychappy

Cash back has made any difference to me. I can save so much more by not buying stuff I don't need, getting discounted food on its sell-by date etc.

Cash back seems like peanuts anyway. Currently I'm getting Avios miles via an old MBNA BMI card. Seems that one's dying.

I suppose I did use Pizza Express more when I had vouchers via my Tesco Clubcard credit card. Perhaps I spent more that way.

PeacefulWaters

It doesn't make me spend more.

latisha_2

I usually use cash than credit card when purchasing food and other items. Since, you have to afterwards even I use credit card.

Linda32

No cashback card do not make me spend more. But if it did, then no I wouldn't be using one.

Nebulous2

Cashback makes me spend more - on one card rather than using another method! I've had quite a bit of expenditure on my house this year and putting that through cashback cards has probably netted me £140 or so. Then there's TSB at 5% on contactless. So while it may seem like small amounts - £200 or thereby is always useful.

Katiehound

No, it doesn't make me spend more. I just put all the expenditure on the credit card and hope to make a few extra £s (or pence!) and it saves me having to carry a load of cash.
I'm really going to miss the Halifax Clarity £5 cashback- it has worked well for me. Looks like now I am going to be using the TSB CC with 1% cashback up to £500 spend- not so generous and I doubt I shall reach that ceiling!!

fozmcfc

I use my M&S card for nearly all purchases over £10 during a month, because of the cashback vouchers. I also sometimes pay friends purchases on the card as well and then take the cash off them. i.e cinema tickets, theme park tickets or even a holiday.

The only thing to make the cashback worthwhile, is to make sure the full balance is paid off each month, as even a couple of months interest, can far outweigh a year worth of vouchers. The only danger in that, is it's important to not spend the cash, that would have been used if you didn't use the card, or someone could well come unstuck.

I've several other cards, which I got for 0% deals, but then I stop using them, because they have no benefits, other than if they have a generous repeat offer on balance or money transfers.

takman

For me it doesn't make me spend more but I always try to avoid cash anyway. I find cash annoying, especially when you end up with lots of change!. So if anything cash may even make me spend more just to get rid of those annoying coins lol.