I was reading a post on MoneySavingMom titled We are debt-free. No thank you It was an interesting story from a guest blogger, and it focused on how the author was able to get rid of her debt by ditching credit cards. I do recommend your take a look, especially if you are struggling with getting out of debt yourself. I’m always happy to read stories of folks changing their way of thinking and taking control of their life when it comes to finances.
But I have to take issue with the overall message, as in “Credit cards are evil. They will get you into trouble, guaranteed.” I think it’s overly simplistic. I do understand that the idea behind MoneySavingMom is to help moms (and dads) to stay out of debt and optimize savings. And let’s face it, overall, credit cards have done more harm than good in this country. I get it.
Still, does the notion of “credit cards are evil” hold true for all families? Absolutely not. This blog is a proof of that. Just read some of my trip reports where we were able to vacation for pennies on the dollar. And it irks me when I see others in this hobby suggest that regular folk (read SAHM) aren’t capable of reaping benefits when it comes to miles and points. That they aren’t smart enough, disciplined enough etc.
I am your regular, run-of-the-mill SAHM
I live in a small town, I stay home with my kids, and we make less than $65K per year. Yes, very average. I am by no means a genius, but I’m not an idiot either. I certainly think I can handle doing basic math, and resist buying things I can’t afford. And frankly, I find it offensive that someone would reduce me to a stereotype and determine my ability to handle credit because of who I am and what I do.
There are many middle-class families just like mine. They are responsible with credit and pay bills on-tme and in-full. They can benefit greatly from maximizing credit card rewards. If you followed my blog long enough, you probably know that this is my main focus. It’s not the bonuses, but rather finding ways to leverage your everyday spending and renewing cards that give a decent perk every year. It doesn’t take a genius to figure out that for an affiliate blogger, it’s not the best profit-maximizing strategy .
Yes, personally, I focus on sign-up bonuses, but I would never suggest that most folks should do what I do. That said, who am I to tell others how to do things? I’m not anyone’s babysitter, and this isn’t my call to make. Last year, I read an article in consumer advocate blog where a lady has reached out to the author. Apparently, she signed up for several credit cards (via advice from a miles and points blogger) and got into debt. She was wondering if she could sue that person. Are you kidding me? What happened to personal accountability, folks?
I’m not saying this industry isn’t full of sleazy practices, but this is absurd. When you buy a car and can’t afford to pay for it, do you sue the dealership? When you buy a vacation package and end up in debt, is the travel agent to blame? My own policy is this: I recommend credit cards and products I personally find worthwhile. Whether they give me an incentive or not is irrelevant. And believe me when I tell you, I have never worked this hard for this little pay in my entire life. But I really do like helping families find ways to travel more.
I’ve said this many times: You are your own best advocate. You should always take everything with a grain of salt, especially when it comes from an affiliate blogger. Do your own research, don’t let this hobby take over your life, and enjoy special memories with your family. Boom.
Miles For Family 
At the most simplistic level, it’s like one of my kids blaming someone else for making them do something. You hit the nail on the head about personal responsibility – you control your own actions. You shouldn’t pay any more attention to the bloggers that are constantly pushing the than you would to those sidebar ads that promise a flat belly with “one weird trick”. If you are not organized and are not good at managing money, then this hobby is probably not for you. And I respect that – people are good at different things. We can’t all be professional athletes or whatever. I just went to a local miles/points meetup for the first time and it was quite amazing to hear how some people are playing this “game”. I’d say the skills and level of organization might be comparable to a professional poker player (and I sincerely mean that in a complimentary and respectful way). Could I be those guys if I intensely focused myself in the same way? Possibly…but at what cost to me or my family? I’m comfortable at my current level but always willing to learn about new things that could be incorporated into my personal game to make it better.
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Looks like WordPress thought my comment enclosed in brackets was HTML code or something…meant to say “You shouldn’t pay any more attention to the bloggers that are constantly pushing the “card of the moment” than you would to those sidebar ads that promise a flat belly with “one weird trick”
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@Erik I always appreciate your comments. And not just because you usually agree with me! 🙂 Man, I wish that “flat belly” trick was real. Oh, and the magic cream to get rid of cellulite. But I digress…
Yeah, readers should always do their own research. If you feel that the sales pitch overpowers the helpful message within the content, simply move on. And yes, the sales pitch in the industry has reached monstrous proportions as of late. It is money first, readers second. Of course, I’m making a bit of generalization here, because not everyone is that way. But that’s what happens when there is only one decent income stream, and multitude of players competing for it.
We all sell to a certain extent. Some do it via affiliate links, some sell their consulting services, others blog to boost their self-esteem/feel important. Nothing wrong with any of those, to each his own. I don’t tell others how to monetize, and don’t really care to hear others’ strong opinions on the matter.
I am my own person, and not responsible for other bloggers’ actions. We are all individual business owners, in a sense. Frankly, I like it that way, and would never join a miles and points blogging network for that reason. Not that anyone would offer such a thing! I’m pretty sure that ship has sailed. I do like my independence, even though it means very limited traffic.
Oh, and you are correct in comparing some of these guys to professional poker players. I saw a blog post where the writer had a photo of this special binder to keep his credit/gift cards organized. You should have seen it! It is incredible that some turn it into a lucrative side business but frankly, my head would explode. I can barely keep track of the few credit cards I have. Actually, I’ll have a post on Monday on my latest blunder. I think it’s important to show the other side of the coin as far as this hobby is concerned.
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Amen, sister!
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@Nancy You are precisely the type of family I try to reach with my blog. I’m not worried about you getting into debt because I know you are more than capable to handle credit cards. Obviously, we all have to be careful, no doubt. I just trust folks to make their own decisions.
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When I first started this hobby in September, 2013, I had the following exchange with Scott Grimmer at Mile Value. It was eye opening.
Me: “I take debt management very seriously, hence my avoidance of credit cards. I realize now that astute management of credit card debt is a great way to build my credit from Good to Excellent, and to ensure our family can benefit from our responsible spending with some great trips.”
Scott’s Response was awesome: “I agree with you that astute management of credit cards is far better than not using them. I wouldn’t use the term “credit card debt” though, since you should pay them off in full each month.”
Basically, Scott helped me separate Using Credit Cards from “Getting into debt.” That was a significant learning for me, as someone who grew up in a household that literally never had a credit card. My parents barely knew how to use their debit cards, and would always embarrass whoever was them whenever they had to use them in public. I think my Dad’s pseudonym is “Dave Ramsey”. He’s taken it so far as to hire a middle aged white guy to play the role of “Dave Ramsey”. He’s an amazing guy.
Also, I just shot a note to Scott that’s been 2 years in the making. It was a follow up to my original note to him in September 2013, and I literally interrupted writing this comment to send it to him out of gratitude:
“Just wanted to follow up:
2 years later:
Will be going to Disney for the 7th time in 2 years (would be our 8th if it weren’t for the loss of a dear loved one)
Will be going to Mexico for the 3rd time in 2 years in December.
Will be taking my wife and our kids on a massive graduation trip for my wife in December which will include: Puerto Vallarta, Cancun, Miami, and, of course, Disney World, then Christmas with the family.
I lost track of how many points we earned once we got past 1 million after the first year.
Credit scores went up 70 points.
We close on our first home in December. Got the lowest available APR at the down payment we had.
I live a part from my wife and kids for a work assignment. Been able to use points to travel between where I work in Wisconsin and where my family lives in Cincinnati.
I am typically the most interesting person at parties, gatherings, and happy hours.
Tl; DR: Thank YOU! You helped me get the most fulfilling hobby ever.”
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@Cheapblackdad That was interesting! Scott is a very smart guy, which is why his blog took off. He also seems down-to-earth and fun. His travel style is similar to mine, though, I think he is even more cheap.
I’m so glad things have worked out for your family the way they did. That’s the point of my post: Let’s not forget the upside, folks! Over the last few years, miles and points bloggers have been maligned to the point where it has become ridiculous. Yes, many have become sellouts but overall, this hobby and blogging industry are benefiting people in a very real way.
P.S. Black “Dave Ramsey” is “virgin” blogging territory, your dad should really think about it!
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Nice post. I’m interesting in learning how Cheap Black Dad did with closing on a new house. We’re thinking about getting a better loan for our mortgage and I always hear that you have to stop using your cards for a couple of years (!!!!!!). Did he stopped using credit cards?
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@Leticia I’ll let Cheapblackdad chime in, he should get the follow-up comment. On my part, I will say this: It’s best not to apply for any new cards for at least a year, better two years. It doesn’t mean you won’t get a good rate if you get a few bonuses here and there, I just think it’s prudent not to take that chance.
If you can apply for a better rate right now and happen to have a good credit score, you can always check and see what they offer. Of course, I’m assuming there aren’t any upfront non-refundable costs. You can always explain that you simply applied for various cards to maximize rewards so you can travel with your family, which is 100% true. I know some hobbyists who had to explain many apps that way, and got approved in the end. Still, my original advice stands. If you are thinking about refinancing in a near future, it’s best to forego apps for now.
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@Leticia I forgot to add. You don’t have to stop using your existing credit cards. Of course, you don’t want to max them out, and should pay balances in full. It’s just not advisable to apply for new ones. Sorry, I should have clarified it better.
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I bought a new house about a year ago. It was somewhat unplanned in that we were casually looking and just happened to run across a good deal. I had many inquiries on my file and my wife probably had a few too (let me say that I don’t do “app-o-ramas”, I tend to get cards when I have a specific need and the bonus is attractive. Also, I do very little MS, maybe picking up the occasional gc when there is a good deal but that’s about it). My existing mortgage was with a small local bank that only has a couple of branches. I went back to them because they have great rates and I had the existing relationship (plus I can walk into the bank’s head branch and sit down F2F with real humans). Anyways…I was a little worried about all the inquiries plus the fact that we were moving out of the old house before selling it, meaning I would carry 2 mortgages until it sold. Sure enough, when the underwriter ran the loan he asked me why I got each account and I just answered truthfully. I think he got it when I said “I just returned from Australia and we flew business class. Had I purchased those seats, it would have been around $32K but using miles it cost me less than $600 total for the taxes/fees).” The mortgage was approved, no problem. So…I guess the point that I’m making is that lots of inquiries aren’t an automatic kiss of death provided that you have a strong credit history, adequate income to support what you’re doing, and a good relationship with your banker. But the advice is sound…if you are actively planning to buy a house, it’s probably best to chill on credit card apps to make your credit history more attractive to lenders and qualify for the best rates (but continue to use existing cards and pay them off every month because they want to see that you are managing debt responsibly). Never underestimate the power of relationships – this was a recurring theme at a recent miles/points meetup where people spoke about having good relationships with store managers, clerks, bankers, gift card vendors, airline employees, etc. as a key component of their miles/points strategy. There are still people who are empowered to make decisions – the computers haven’t entirely taken over.
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@Erik Thank you so much for relating your experience! I think this topic actually deserves its own post. I will feature your comment. Hope you don’t mind!
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I’ve got you so covered you can sell all your blankets in a rummage sale.
Also, sorry for the delay. I travel back to see my wife and kids on the weekends and between the drive and family activities, there is little time left for much else.
Here’s a quick overview, which likely includes things you know. This is probably worth a post all of its own, and I am curious what others think. May be that guest post you have been harassing me about, Leana.
Understanding Your *Mortgage* Credit Score
1. Don’t use the free scores from your credit card/creditkarma, etc. They are likely using FICO 8, the most recent FICO model, but mortgage lenders are using the older scores.
2. Get a MyFICO subscription, and look at the “other scores” option they have, and leverage the score that they mention mortgage lenders use. That’s the most accurate score you have.
Managing Your Score:
3. Managing your credit card balances (not too high, not to low) is the most powerful short term thing you can do to improve your score. We got our score about about 40 points over the last few months playing the balance game.
4. We stopped applying for cards last September. We applied for 1 each in May/June of this year. We applied for our loan in September. I’ll go back and look, but I think when they ran us, we had 1 credit card app a piece in past 12, but probably like 5+ each past 24 months.
5. 740+ is the magic number. They’ll basically take the midpoint score provided the other two aren’t off too much. i.e. if you have a 742, 750, and 767, they’ll effectively call you a 750.
That’s it. Hopefully you notice this, Leticia.
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Also, I found the opposite to be true relative to a point you made. We actually saw a bump in our credit scores when we used a card we had stuck in the sock drawer. We didn’t let a balance post, but usage across cards seems to be rewarded and lack of usage seems to be punished.
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@Cheapblackdad Thanks for chiming in! I will make sure to add your thoughts to a post on this very subject. So, Leticia will see it even she misses your comment. I’m actually not surprised that using older cards helped your score. FICO is a complicated beast, but it likes to see various accounts and how you handle them.
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Thanks everybody! all the information is very valuable! I remember a few years ago a bank clerk, talking about credit scores told me that I’d lose my sleep trying to figure out how it works. In a way I know I may not be doing EVERYTHING I need to in order to have the best score I can. I don’t use all of my credit cards. Many are sleeping in a box just because I know I couldn’t manage to keep track of all of them. Maybe I need to create a system that works for me but there’s too much in my life right now. I’m always using the 3 that I’m trying to meet minimum spending with and when I’m done with those I usually have some coming in the mail. I will change a bit my strategy to get the best refinancing but I liked the fact that you can just go and explain to bankers the reason why one gets so many cards, we may get some new followers of this hobby!
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