Monthly Archives: September 2013

The time to start is NOW

“No time like the present, no bird like the pheasant,” my dad is fond of saying. It’s nonsensical but gets stuck in your head after awhile. I always figured it was some old-timey common saying, but in all of the Googles, only one other person has said something similar:

Present Pheasant

Photo courtesy of  Reuben WhitehouseSome rights reserved.

Thanks, quirky internet stranger! Anyway, I’ve hesitated to write this post, because even though I’ve wanted to communicate this idea, it’s not as practical and quantifiable as most of the other advice and experiences I’ve shared. Then, of course, I realized the irony of putting it off, and decided to just jump in and try to say what I want to say.

Several times in my life, I’ve made a lifestyle change quickly. When I was 19, for example, I went into a presentation on animal rights a complete meat-eater (barely an omivore, only in that I used a bun to hold burgers and tended to have fries on the side) and came out a vegan. As in, I went to the cafeteria for lunch straight after the lecture determined never to eat meat again, and I haven’t. (Dairy and eggs I’ve been a bit lenient on as ingredients over the years, but not meat.) I am 39 now, so I’m thinking this change is going to stick.

This is the most drastic example, but there have been other times when I’ve shut down or started up a habit almost on impulse and it’s stuck. My big financial transformation may have taken a few days vs. the hour it took to turn vegan, and I’ve fine-tuned my approach almost constantly over the years, but the psychological shift was sudden, dramatic and (seems to be)  permanent.

There are many other instances where I’ve tried to make a change and it hasn’t stuck. One of my biggest weaknesses (now that I’m no longer an overspender, that is) is physical fitness. I’m a slothlike creature by nature, loving to recline, relax, remain resplendently in repose, etc. Getting up and getting moving is just not my first impulse (or my second, or third, or …). So I’ve started countless physical fitness journeys that have petered out after a week, a month, a year … I’ve never gotten a routine to stick, basically. My only saving grace is I’m too cheap to buy a car, so I get a lot of walking and occasional biking in.

Will I ever find a routine that sticks and gives me my ideal body and fitness level? I’m not sure, really. But I never give up the idea that I will. So whenever I feel inspired to try, I start a new fitness routine.

Same with housekeeping. Having grown up in a cluttered household, barely ever asked (or taught, or ordered) to lift a finger to clean up after myself, I have a well-honed laziness and ability to turn a blind eye to chores that should be done. Every once in a while I get a burst of inspiration to tackle the floor of the whole condo, or keep the surfaces clear of paper clutter ONCE AND FOR ALL, and sometimes these bursts last weeks or even months. But again, I haven’t found a way to make myself consistently useful in the arena of housekeeping (beyond finding room in the budget for a cleaner to come once a month to help out!).

So why am I regaling you with tales of my chronic failures? I just want to make it clear that I’m no guru who’s found the key to modifying every part of my behavior that I find lacking. There are some parts of my life where I keep stumbling and having to start over again.

But where I’ve really succeeded, I’ve found that my big life changes have a couple things in common:

  • I started right away. When I’m struck by the inspiration to make a big change, I tend to do better if I don’t spend time dithering, or making elaborate preparations for the change. On the other hand, I’ve watched myself and many friends of mine delay making changes, either by flat out saying “This isn’t the right time” or “I can’t,” or by spending tons of time in the planning stage — making plans that quite often don’t actually ever get implemented, or fizzle out quickly; sometimes even spending money on the tools for something that never gets off the ground. (I can name my $1000 treadmill bought on a payment plan, a 15-year-old mistake I’ve never forgotten, as one painful example.)
  • quit something first. With both veganism and fiscal responsibility, the first step was to stop. I stopped eating meat and dairy, and found that I could find enough subsistence around me to get by while I learned how to cook and get a well-rounded diet. I and my family stopped spending; for a time we bought only groceries, turned down every invitation that would cost us any money, and made do with the clothes, housewares and other supplies that we had on hand, before we gradually figured out how to budget those things in. If you can’t figure out how to get started, maybe there’s something you can stop doing as a first step.
  • established a routine as quickly as possible. With money, of course, I started setting up little challenges and goalposts, and started a blog about them. Soon, I’d feel weird and itchy if I had a financial bit of news and didn’t  share it with my blogger community, or if I paid a bill and didn’t change my debt totals on my spreadsheet.
  • made myself accountable. With the veganism, I had a clear moral path and so I needed nothing more than personal guilt to keep me on track. But with finances, I’d tried many times before, and it really helped to have an audience (my blogger community) and a high-stakes motivation (keeping my family from going into default on our debts).

With one of my more recent (temporary) fitness successes, I’d been tiptoeing around the fact that I needed to add strength training to my daily life. My wife started doing a certain amount of the same kinds of exercises every morning and night, not making a big deal of it, just taking less than 5 minutes out of her morning and night routines to fit it in. After watching this for about a month, I suddenly one night thought, “Why try to come up with some brilliant hard-hitting weights routine when I could just get started?” So the next morning I began my own little mini-routine of strength training, and that night, and the next morning … very soon it became second nature, and only a couple of health scares/events derailed me. But yesterday morning, I started up again, again on a whim.

I think this one could be a keeper; it just got interrupted too soon in the process to stick the first time I tried. But it’s something I can start right away, and it’s easy to make it part of my mornings and evenings, which are some of the most routine-heavy times in my day.

So, if you’re still reading, here’s what I propose: Pick something you’ve been wanting to do, something that’s been nagging at you for a while that you’ve found seemingly valid reasons to put off. Start doing it right now. The first step for many lifestyle changes can’t be planning; it has to be something with a palpable reward, a feeling of a step taken.

So you want to get fit? Get up from your desk and do 25 ab crunches, then set your alarm for the next day at the same time so you can do them again. You want to start saving? Open a savings account — they’re all about the same, so just pick a free one and start; you can always switch later — and set up a recurring automatic deposit. You want to start making money to pay off debt? Go through your stuff and list something on Craigslist right away.

Whether the change you want to make is big or small, the first step can probably be taken right now.

Credit card rewards: my take

As many of you know, I have big dental expenses coming up next year. Somewhere between $2800 and $5000 of expenses. I’m looking at ways to minimize the bite, and I said offhand to my wife that I wished there was a credit card that gave extra rewards points for medical expenses.

Then I realized I hadn’t actually ever looked for that type of card! But I did some research today and, alas, I don’t think there is a card that gives you extra points for that category of spending. I don’t know why; just one of those weird quirks of the credit industry. Because there are ways to get extra rewards for almost every other type of spending, if you play your cards right (you saw that coming, right?). And, there’s still a chance I can significantly offset my medical bills using credit cards.

There are two main strategies for taking advantage of credit card rewards: finding the card(s) whose everyday rewards structure works best for your spending, and the credit card churn.

CAVEAT: Before I go into this, I want to say I don’t recommend ANYone try to play the credit card rewards game if you carry a balance. Why? Because if you already carry balances, it could be difficult to make sure you pay off any new purchases, and the interest you pay on the increased balance could negate the rewards you earn. I started learning about these strategies a year or so before I paid off our credit card debt, but I held off doing anything about it until all my existing balances were paid off. Even then, I hesitated about starting to use cards again, but I dipped my toe in and discovered I had no problem keeping them paid off, so now I use credit cards regularly.

So first, go and pay off all your credit cards. Easy, right? I know, it’s not, but if you do carry credit card debt, I recommend you make eliminating it your number one goal (besides spending less than you earn).

Anyway, on to the credit card reward strategies:

1. Everyday rewards. Many credit cards have rewards programs attached. Typically they reward you points worth 1% of your purchases and let you withdraw them once you’ve hit $20 or $25 worth of points. So if you have a card that offers that, once you spend $2000 you’ll have enough rewards points to redeem for a $20 check or statement credit (or gift card, or airline travel discount; but cash back is my favorite so I’ll focus on that). It doesn’t sound that great, huh? But many cards also offer extra points in some categories. As a random example, BankAmericard Cash Rewards™ Credit Card offers 3% rewards on gas and 2% on groceries. So for spending $1000 on gas, you’d get $30, and $1000 in groceries would get you $20 back. Some cards give even better rewards. The Target Visa gives an automatic 5% back at the register when you use it for Target purchases, so you don’t even have to wait to accumulate rewards; you just get the discount right there. And some cards offer rotating bonus categories that change every quarter.

My favorite card, besides the Target RedCard Visa, is the Blue Cash Preferred® Card from American Express. It offers 6% rewards for groceries and 3% for department store purchases. There’s a $75 annual fee, but even with that we clear about $350 a year. If I ever find a card that has a fixed 5% reward for groceries, that would top the 6% minus $75, but for now, it’s the best grocery card for me.

An intriguing card I just found out about is the USBank Cash+ Visa card. You can choose two categories to get 5% rewards for. Unfortunately, groceries is only eligible for 2%, but if you tend to spend a fair amount at department stores, restaurants or hotels (to name just a few available categories), you could earn 5% rewards on them. Right now we hardly spend any money at stores outside of groceries, so I doubt we’ll get much use out of this one, but I think it could work for someone else. The Chase Freedom Visa offers three 5% categories, but it chooses them for you. Right now the categories are Kohl’s, gas stations and amusement parks, and past categories haven’t been very relevant for me either. I’ve been using a Chase Freedom for years, but I mostly only earn the 1% because I spend in non-bonus categories. At this rate, I’m starting to think I’d be better off with the Quicksilver Cash Rewards Credit Card from Capital One, which gives you a straight 1.5% on all purchases. At least I’d be getting $30 per $2000 instead of $20.

One place we do spend a fair amount of money is Amazon.com, and we have an Amazon Rewards Visa Card linked directly to our account that earns us 3% on Amazon purchases. And it’s easy to redeem the rewards as a discount during checkout.

If you’re organized enough to track spending on multiple cards, I’d recommend using several, maximizing the amount you spend on your most common categories. That’s where we’re heading, although we haven’t completely settled on the best cards for our everyday spending (besides groceries, Target and Amazon). Many sites have regular roundups of the best cards, including one of my favorites, Kiplinger’s.

One reason I haven’t completely focused on the best permanent cards to carry is that I’ve spent the past couple years engaged in the other type of credit card rewards tactic:

2. Sign-up bonuses, aka the credit card churn. Right around when we finished paying off our credit card debt, several card companies — mainly Chase and Citi — were offering pretty outlandish bonus offers if you opened a new card and spend X in X months. In 2011 and 2012, I made over $4000 per year without spending a cent more than I’d intended to spend anyway, just by opening cards, spending up to the point where I could get the bonus, paying the card off, redeeming the bonus, and closing the card. The cards aren’t offering those bonuses right now — one of the bonuses I got was $1000 for spending $3000! — so my rewards this year have been much smaller, and I haven’t opened and closed as many cards.

That said, if you know you’re going to be spending a ton of money, it might be worth taking advantage of these types of bonus offers to offset the cost. For instance, we were going to England and knew we’d most likely use Delta, so we opened three Amex Delta cards — one in each of our names — and spent up to the point where we each got $300 worth of Delta miles. So when we booked our trip, we got a $900 discount on our airfare by using the bonus miles. And for my upcoming dental costs, I might take advantage of one of the few remaining big-bonus offers (unless there are new big offers next year): the Chase Sapphire Preferred® Card, which gives you 40,000 points for spending $3000 in three months. That’s $500 of travel rewards or just $400 straight cash. So it would be like spending $2600 on dental expenses vs. $3000.

So keep an eye out: The big rewards may come around again. And even if they don’t, there are tons of “spend $500, get $100 back” offers out there that you could use for a small but easy cash infusion. I check in regularly at several great websites: My Money BlogCreditCards.com, nerdwallet,

You may be wondering, how’s my credit score doing with all this opening and closing of accounts? I have to say: Great! Occasionally if I open or close several in quick succession, I’ll see a small temporary dip in my score. But it’s stayed in the high 700s, low 800s this whole time, so I honestly don’t think it has much effect as long as you don’t miss any payments and don’t carry a balance.

CalculatingCreditCardRewards

Image courtesy of moggara12 / FreeDigitalPhotos.net