With credit card companies cracking down on unused accounts, it’s a good time to review our credit card accounts. We’ve gotten a few letters lately of closed accounts, from Chase and Citibank, for unused cards.

Usually, I’m pretty diligent about using each card once per year, but I guess I got a little lazy! Sometimes it’s hard when the card has a low limit, the 0% balance transfer offer is used, and there is no cash rewards program. Those cards just fall to the bottom of my priority list.

Current Credit Cards

After the closures, and opening up some other great new cards last year, we have 93 open credit lines right now; up 4 from the 89 accounts we had a year ago.

I’m pretty diligent about using our oldest cards (those 10-15 years old) to make sure those never get canceled.

The four that were canceled had relatively low credit limits as the result of reallocating credit limits, and were opened in the last 3-5 years; I don’t expect much of an impact on our credit score from the closures.

However, if the trend continues, a lot of closed accounts could impact our credit… I’ll be working hard in the next couple weeks to make charges on our inactive cards.

Keeping Credit Cards Active

I pulled out my old spreadsheet to plan my attack. When I’m trying to make sure to use our cards once per year, here’s how I manage it:

1. Make a list of all your cards (easy to do if you have a list in MS Money.)
2. Find all the cards you haven’t used in the last 11 months.
3. Rank the list of unused cards. I give a higher ranking to the oldest cards and those with high credit limits.
4. If you are into credit card arbitrage, double check that you aren’t using a 0% balance transfer on those cards, just to make absolutely sure you wouldn’t accidentally hurt one of the balance transfers with a purchase.
5. Pull all the cards, and put a sticky note on each one with the rank, rubber band them and put them in your purse or wallet.
6. Next time you need to make a small purchase, use the one with the highest rank.
7. After using it, put the card back in storage. I only regularly carry my preferred cash back credit cards.
8. Put a note on your bill pay list that you’ll have to pay that bill.
9. Monitor your credit report and score with Free FICO Scores & Credit Reports.

Of course, it’s not really that scientific if you only have a few cards. But if you have a lot like I do, you want to be able to get through them quickly, without sacrificing much of your cash back opportunities. In addition, if it’s not realistic to get through them all, at least you are using the most important cards, those that affect your credit score the most, first.

What’s your strategy to remind yourself to use old credit cards once per year?

More Canceled Credit Cards

• Credit Card Closed My Account
• Another Credit Card Account Canceled
• More Inactive Credit Cards Being Closed
• Why Are My Credit Cards Being Canceled?

 Print   |   Email   |  12 Comments

As part of my effort to organize myself for the New Year, I’ve found that I’m starting to become a pack rat with papers.

While I was busy purging paper and backing up the electronic data, I realized that when we don’t know how long to keep something, we end up keeping it forever… or not at all. Here’s how long we should be keeping those important papers:

Forever

• Birth Certificates
• Marriage Certificates
• Divorce Certificates
• Death Certificates
• Military Documents
• Immunization Record
• Employment Records (Why)
• IRA Contributions (Why)
• Social Security Card
• Tax Returns: The IRS can audit your returns from 3 years ago; 6 years if you grossly under reported; indefinitely if you filed a fraudulent return or did not file. So you could pitch your returns after 7 years… however, if they claim you didn’t file, and you pitched it… well, now you know why I put tax returns on the indefinite list! For more details on how long to keep tax records, see how long to keep tax returns.

Keep During Ownership

• Car Titles and Service Records
• Receipts, Manuals, and Warranty Information for Appliances
• Receipts for Major Purchases like Jewelry, Furniture, and Computers

Ownership Plus 7 Years

Even after you sell investments or real estate, you’ll still need to keep the gain or loss documentation for tax purposes.

• Stocks, Bonds, and Investment Records
• Savings Certificates
• Home Improvement Documentation
• Real Estate Records

7 Years

Many of the following will contain information that supports tax returns. Therefore it’s best to keep the following for seven years:

• Canceled Checks
• Credit Card Statements
• Old Bank Statements
• Retirement Plan Contributions
• Supporting Documentation for Tax Returns

Until Specified Date

• Annual Retirement Statements: Until retirement and funds are exhausted.
• Insurance Policies – Until property is sold, policy expires, and all claims are settled.
• Wills: Until replaced by a new one.

Throw Away

• Receipts not used for Warranties, Taxes, or Insurance
• Paycheck Stubs: Once you get your W-2, you can toss them
• Phone Bills not needed for taxes
• ATM Receipts
• Grocery Receipts

 Print   |   Email   |  11 Comments

It had to happen… I’ve had a pretty sweet deal come to an end. For a few years, I’ve had a Chase card that earned 5% back on gas, groceries, and drugstores. I didn’t talk about it much, since you can’t apply for it anymore, so there wasn’t much point.

I got a letter that the program will change to 3% now. That change, coupled with my need to use an American Express card at Costco has had a domino effect on my cash back plan.

I always want to get the most cash back possible for all our spending, so I ran the numbers and calculated break even points between each card for each category that had tiers to break through. Here’s my new plan.

Best Cash Back Credit Card By Category

Tips and Tricks

Spousal Tip

If you are like me, the only thing that will spoil the new plan will be trying to reteach your spouse which card to use where. My poor husband finally had it figured out too! Write where the card should be used in a black marker on the front of the card.

Business Cards

Want a business card, without a business? I explain how individuals can use Business Cards.

Discover Quarterly Promotion

Discover has quarterly promotions; sign up online with any Discover card. October 1 – December 31 has a 5% Cash back bonus on up to $400 on these purchases:

• Grocery Stores
• Restaurants
• Movie Theaters
• Movie Rentals

Action Plan

I have three of these cards currently, so I’ll put those into the rotation. I’ll plan on applying for the rest in a few weeks.

Did I miss any? I want to hit the highest cash back in every category; let me know if there’s a card out there that’s better than the ones I found.

 Print   |   Email   |  9 Comments

We joined Costco! And we went there 5 times in 8 days! Here’s the catch with Costco, if you pay with credit, you need to use an American Express card. Lucky for me I keep a stash of credit cards handy for “emergencies” like this!

Why does it matter which card I use? Because I never like to give up free money! There’s one card that I keep just for cash back everywhere. It’s the Blue Cash Everyday from American Express.

I already have one, so it’s naturally the one that I pulled out when I went to join Costco. I also use it whenever the American Express Wishlist comes around (which will be soon…. I’ll let you know!)

It’s also one of those cards that is perfect for people who just want to carry one card and forget about chasing all the various cash back offers.

Blue Cash Everyday Card from American Express

• No annual fee, 0% intro APR on purchases for up to 12 months, flexibility to pay over time.
• Get 3% cash back at supermarkets, 2% cash back at gas stations and department stores, and 1% cash back on all other purchases.
• NO spend minimum, NO enrollment, and NO rotating rewards categories.
• Get a $25 Referral Bonus for each friend or family member who is approved for the Card.

How the Cash Back Works

So exactly what does “up to 5%” really mean? Here’s a helpful chart from the Blue Cash Everyday Card from American Express site:

“Everyday Purchases” are Eligible Purchases made at U.S. supermarkets, gas stations and drugstores, in each case that are not departments of superstores or warehouse clubs.

Um, ok. So exactly what percentage cash back am I earning? For supermarkets, gas stations and drugstores, I took a few annual spending amounts and calculated the cash back percent:

• $7,500: 1.5%
• $8,750: 2.0%
• $10,400: 2.5%
• $13,000: 3%
• $26,000: 4%

We were spending about $9,600 per year on gas and groceries. So that’s about 2.3% using the Blue Cash Everyday Card from American Express.

Once you cover the $6,500 threshold, you’ll also earn 1.5% on all your other purchases, which is fantastic, compared to most other cash back cards around right now.

More Features of Blue Cash Everyday Card

Unlimited cash rewards. This is a fantastic option for me. Every time I find a card with great rewards, my plan gets foiled by the limits. Not here!

Cash Tracker. They have a nifty online dashboard meter that shows you how much you’ve spent and how close you are to breaking through the tier.

Readers Love It. Whenever I write about credit cards, I hear about this one. Here are some recent comments:

• I have American Express Blue Cash and in addition to the rewards they have great (and usually quick) customer service. – sara l
• I’m with sara – you can’t beat American Express customer service. I have the Blue Cash and a Blue Rewards and I never use anything else (unless it’s a merchant who doesn’t take Amex…!) – Brip Blap

More Blue

In addition to the Blue Cash from American Express, you can also check out the Blue Sky Preferred Card from American Express where you can earn points for any airline, any hotel, any cruise or any car rental with no blackout dates, advance purchase requirements, hotel room restrictions, or travel restrictions.

Action Plan

Whenever I switch out some of our cards, it ends up being a domino effect. I’ll do a more thorough reevaluation of my stash of credit cards in the future. Stay tuned to see the other cards that I’m planning to use. Until then, I’ll be using my Blue Cash Everyday Card from American Express.

 Print   |   Email   |  6 Comments

Regular readers know that I’m a credit card arbitrage junkie. This one is for those of you that enjoy playing that game and want to take it to the next level, using business credit cards.

Why Are Business Cards So Useful?

They don’t report on your individual credit report. So you can use 90% of the limit on a bunch of cards and it won’t hurt you when you apply for more. It will appear as if they don’t even exist. This is clearly one of the most significant ways that I can carry over $200k in credit card balances and continue to be approved for more.

Do You Need a Business?

No. Most credit card companies allow you to open a business account as a sole proprietor using your name for the business name and your SSN. Before I had a “real” business I did this all the time. If it asked for my income, I just put down the amount of stuff I sold on eBay, which wasn’t that much. It doesn’t really matter though, because you can often reallocate your credit limits for bigger balance transfers.

In addition, some of the cards specify that “transferred balances must consist of business-related expenses.” Interpret that how you feel comfortable. I’ve always been honest with the companies and said what I was doing with the money and none of them had any problem with it.

Here are some 0% balance transfer business cards to get you started. As always, I’ll keep this list updated, so you can bookmark it and use it for reference in the future. If you want to make your plan of attack with the personal cards too, you can use the full list of 0% Balance Transfer Credit Cards.

0% Balance Transfer Credit Cards for Business

Sorry, there are no cards available right now.

 Print   |   Email   |  3 Comments