Should I Get a New Credit Card?

Posted March 24, 2008 by redgixxer
Categories: Credit

I recently came across a post on cash back credit cards over at MillionDollarJourney. He also has a follow up here. RedFlagDeals also has a good comparison of rewards cards which is worth a look.

It got me to thinking that maybe i should get a new credit card and ditch the old one. I currently have a Scotia Value Visa with a fairly low interest rate of 11.4%. However, i pay an annual fee of $29 for this low interest rate. This was fine when i was carrying $5000 balances month after month as the annual fee easily paid for itself with the savings on interest. Now though, i have no credit card debt and pay off any balance every month.

So my rationale is to get rid of the Scotia card as i am now wasting $29 a year for something that is not providing any benefit. I would then get one of the cash back cards that pay cold hard cash in exchange for using it. I like the idea of getting actual cash back in my pocket, and then i can choose how to spend it. I realize that some of the other rewards cards pay a slightly higher percentage payout, but those rewards don’t appeal to me as much as cash.

There is one little hiccup. Actually two. I do not own my own place and am looking to do so in the near future. So i am hesitant to get a new credit card which would affect my credit score some. This could in turn affect the interest rate i would have to pay on a mortgage. I know i have a good credit score but don’t want to mess with it until after having bought a place.

The second hiccup is that i would be a little worried i would actually spend more on my cash back credit card than normal just for the benefit of the extra cash i would get back. This actually happened once before when i had a GM Visa with a certain percentage going toward a new vehicle. I paid for everything with my GM Visa and did not pay attention to how much money was flowing out of my pocket. So if i were to get a new cash back card i would have to be very careful and extremely vigilant about not spending more than what i need to.

The Bottom Line

For now i think i will hold off on the new credit card until i have obtained a mortgage. Once i have the mortgage (and lots more debt to boot) then i will get the new credit card and cancel the current one. Food for thought.

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Dividend Dollar Daily Round Up

Posted March 22, 2008 by redgixxer
Categories: Daily Round Up

The Round Up

I’ve heard the term “equalization payments” used before, but never really understood what they were until i read this article about Ontario becoming a have not province.

Dividends4Life makes and interesting comment about the number of Canadian dividend blogs.

Report On Business always has a weekly article giving a financial facelift to people.

No Fee Bank Account

Posted March 22, 2008 by redgixxer
Categories: Uncategorized

So i recently decided to open a no fee banking account. We all know that banks charge fees for everything and this contributes to their always rising profits (US housing crisis not withstanding). There are probably a lot of people who will clip coupons to save a few cents on an item, yet they don’t pay any attention or have no idea what they pay in bank fees every month. It would not be uncommon to pay $5, $10 or even more a month for using your bank account. This may not seem like a large amount, but over the course of a year this can add up.

I sat down and figured out that over the course of 19 months i paid $99.45 in fees. That is over $5/mth on average. I don’t write many cheques and hardly ever use an ATM card though. For those that make a lot of ATM transactions or pay for unlimited transactions, that could really add up.

If you are interested in a no fee account you can find out about it here. I would highly recommend doing this in person as it only takes about 10 minutes. I did it online and it was a real mess.

I will take my $5+/mth and invest it or use it for something i enjoy. Let’s face it, $5/mth in banking fees do not enhance my life in any way.

Dividend Dollar Daily Round Up

Posted March 21, 2008 by redgixxer
Categories: Daily Round Up

The Round Up

The Globe Investor magazine has a good article why bonds are a bad deal.

Here are the Top 10 Features Of A Profitable Rental Property by Andrew Beattie at Investopedia.

My First Post!

Posted March 21, 2008 by redgixxer
Categories: Uncategorized

Hey folks! This is the first of what will hopefully be many posts on everything dividends and other personal finance matters. This is my first blog, so i expect a bit of a learning curve for the first little while. Therefore the posts may be a little slow at first, but hopefully become quite regular after some time. Happy Easter everyone.