{Money Journal} The Pros and Cons to Credit Card Upgrades

On a given week, my mailbox is flooded with credit cards upgrade offers that I immediately place in the recycle bin. It wasn’t until about a month or two ago that I received two separate offers that made me go hmmm…, maybe I should find out more. So off to the bank I went to speak with a representative about the Limitless Card and the Cash Back card.

The Limitless Card

The first offer that intrigued me was one the limitless card, known to me as the Discipline Tester. I sparingly use my card anyway, so a limitless card would actually help boost my credit score because it eliminates the debit to credit ratio for that card. There are several downsides to this type of card, though. For those who are not careful, the limitless factor could entice one to live beyond one’s means; thus, putting the cardholder further into debt. Another disadvantage to this type of card is the higher interest associated with the card… like say around 22%, which would skyrocket even more if you were ever late for a payment. In my opinion, this card is a NO GO!

The Cash Back Card

A cash back credit card is one that offers a percentage spent back to the card holder. It’s great because you can get money back for things you would buy anyway, like gas, groceries, and sometimes travel expenses. It’s also great, because you can have the cash received applied to your credit card bill, into a checking or savings, or in some cases applied to your mortgage. It’s downside- some people get so caught up in the cash rewards that they spend more than they were initially planning on saving. Therefore, you are basically spending money to get a deal…again, NOT GOOD!

Between the two cards, I did choose to upgrade to the cash back card. I found myself briefly falling into the spending trap of the cash rewards card. On a positive note, the cash back rewards seem to be accumulating much faster than the reward points system of my previous card and I will use that money to in turn, pay down my debt.  More updates to come as I feel how it is working out.

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2 thoughts on “{Money Journal} The Pros and Cons to Credit Card Upgrades

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