Question: My wife and I have 14 credit cards between us. Most of them offer cash back or airline miles, but three are department store cards we signed up for so my wife could get an immediate shopping bonus. Two more are gas cards, and one is from Kroger, a supermarket near us.
I want to get rid of most if not all of these, but she insists we make money with these cards. We do, but we also forget to pay off the balance every time, and we still haven’t paid off the balances on those store cards from the last holiday season because we’re making minimum payments.
Am I right? And if I am, how do I convince her?
— Greg in Connecticut
Howard Dvorkin CPA answers…
Let’s tackle the easy part first: You’re right. You don’t need 14 credit cards. Before we even talk about the balances you’re carrying — which is the major problem here — let’s talk about which cards you can easily dump right away.
For starters, point your wife to Debt.com’s scathing review of the Kroger rewards card, called Everything You Don’t Want And More! Then have her read our recent report, More Reasons Why You Shouldn’t Bother With Gas Credit Cards.
Since your wife ran up holiday bills on her department store cards that you have yet to pay off, give her one last reading assignment: Just Say ‘Bah, Humbug’ To Store Credit Cards.
All of these reports were written by a credit card expert I hired named Jason Steele, and he has multiple cards himself. As he famously documented for Debt.com, he once flew around the world in first class using nothing but his credit card points.
Meanwhile, I’ve written in my books, “Learning to live without a credit card is an integral part of financial empowerment. The lessons you discover will add to your building blocks that will eventually lead to your financial independence.”
Yet Jason and I agree: If you carry any balance at all, you should focus on paying those off before you even consider thinking about cash back, airline miles, discounts, or any other form of rewards.
If you want to prove this to your wife, use the Debt.com Debt Repayment Calculator to show her the hard numbers. You can show her how long it will take to pay off these lingering balances at the minimum payments — and how much that’s costing you. It’s certainly eclipsing any rewards you’re earning.
If that still doesn’t work, maybe talking to an expert will. Call one of our certified counselors at 1-800-810-0989 for a free debt analysis.
Have a debt question?
Email your question to firstname.lastname@example.org and Howard Dvorkin will review it. Dvorkin is a CPA, chairman of Debt.com, and author of two personal finance books, Credit Hell: How to Dig Yourself Out of Debt and Power Up: Taking Charge of Your Financial Destiny.