jen3kids Posted September 18, 2012 Share Posted September 18, 2012 The credit card rewards thread from last week (or maybe a couple weeks ago) got me thinking... DH and I have one credit card that we use for everything and we get United AirLine travel miles that have served us well. However, I just received an offer in the mail for a cc for REI (an outdoor store). With 2 boys in Boy Scouts and my dd and I in GS, we shop there quite a bit for gear, clothes and food. They are offering a $100 gift card to their store for signing up and then a $100 credit on a statement if we charge at least $3000 on the card by Dec. 31 (no problem there!) They also offer 5% back on purchases at their store and 1% back on all other shopping. That credit goes onto my yearly refund, so more money to spend at REI. I was thinking of getting it (and the gift card), using it until Christmas, getting the $100 credit and then being done with it. Is that ok, ethical, allowed? Does it damage my credit rating? Anything else to consider? Thanks, Quote Link to comment Share on other sites More sharing options...
bookfiend Posted September 18, 2012 Share Posted September 18, 2012 Yes, it is allowed. IMO - it is ethical. We have done the same with Marriott Rewards Card (many, many hotel points that gave us free lodging for this summer's vacation) and AMEX (who gave us $500 in rewards points which paid for 1/2 of Christmas last year). We also used to do this when we carried a credit balance and cards would offer 0% for a year if you switched. So while we worked at reducing our debt load to zero, it didn't cost us anything. Just be certain that when you cancel the account, you get a statement from them in writing that the whole account has been closed. The company is offering you an incentive to try their card. Take advantage! Quote Link to comment Share on other sites More sharing options...
fairfarmhand Posted September 18, 2012 Share Posted September 18, 2012 we've done things like that before. Have no idea how it affected our credit, but ours is in great shape anyway. Quote Link to comment Share on other sites More sharing options...
jen3kids Posted September 18, 2012 Author Share Posted September 18, 2012 Thanks to both of you. I have signed up for store credit cards before to get their one-time immediate 15-20% discount, so I don't know what I'm waiting for. I think I'll go to REI's website and see what I find. Thanks, Quote Link to comment Share on other sites More sharing options...
SailorMom Posted September 18, 2012 Share Posted September 18, 2012 I wouldn't close the account when you're done. Just leave it open without a balance on it. Otherwise - great plan :) Quote Link to comment Share on other sites More sharing options...
jen3kids Posted September 18, 2012 Author Share Posted September 18, 2012 I wouldn't close the account when you're done. Just leave it open without a balance on it. Otherwise - great plan :) Why not? In case we need it in the future? Quote Link to comment Share on other sites More sharing options...
merry gardens Posted September 18, 2012 Share Posted September 18, 2012 It could affect your credit rating. Opening new several new accounts negatively affects credit rating. Closing accounts (even if you're the one who does it and you paid everything on time) negatively affects credit rating. Dh recently check his credit rating and was told those two things were why his score was lower than mine. It could also affect your credit score because it's easier to forget making payments on seldom used cards. Plus-- it can negatively affect your finances even if you do make all the payments because they'll send you all kinds of tempting offers on items you may want but don't need. Spending money to save 10, 20 or 30% doesn't really save money. edit to add: yes, it's ethical to do it, but it may not be wise. Quote Link to comment Share on other sites More sharing options...
DianeW88 Posted September 18, 2012 Share Posted September 18, 2012 Why not? In case we need it in the future? Closing it could negatively affect your credit rating. Just leave it open with a zero balance and don't use it. Quote Link to comment Share on other sites More sharing options...
jen3kids Posted September 18, 2012 Author Share Posted September 18, 2012 It could affect your credit rating. Opening new several new accounts negatively affects credit rating. Closing accounts (even if you're the one who does it and you paid everything on time) negatively affects credit rating. Dh recently check his credit rating and was told those two things were why his score was lower than mine. It could also affect your credit score because it's easier to forget making payments on seldom used cards. Plus-- it can negatively affect your finances even if you do make all the payments because they'll send you all kinds of tempting offers on items you may want but don't need. Spending money to save 10, 20 or 30% doesn't really save money. edit to add: yes, it's ethical to do it, but it may not be wise. Hmm, never knew that. I think it makes no sense that closing an account is bad. :confused: What is the rationale behind that? I'm embarrassed to say that dh takes care of all the financial decisions and I just sign on the line. It holds no interest to me at all, but I guess I should pay more attention. I think I will check how many store cards I have, because I do know I opened accounts at a few major retailers to take advantage of their discounts.... Closing it could negatively affect your credit rating. Just leave it open with a zero balance and don't use it. I'll have to think about it and do more research. Apparently, the possibility of debt is enough to push down your score. Quote Link to comment Share on other sites More sharing options...
milovany Posted September 18, 2012 Share Posted September 18, 2012 We've done this to get free airplane tickets and I don't have a problem with it. Have you factored in the annual fee (if there is one?) in the pros/cons of doing this? I know the prevailing wisdom is to leave the account open, but when we did it, we closed the account when we were done with it. We chose to do this because of the following: We both have very strong credit; we bought the house we're planning to stay in for oodles of years a couple of years ago; and the only other loan we sometimes take out is for a vehicle, paying it off asap, far sooner than the life of the loan, and we get those loans from our credit union which is easier and more personal than the mortgage companies (easier to get the loan if needed). Oh, and we're set with insurance; happy with where we are. A small hit to our credit score doesn't mean much in our situation, and we don't want to have more than one credit card active. Quote Link to comment Share on other sites More sharing options...
jen3kids Posted September 18, 2012 Author Share Posted September 18, 2012 We've done this to get free airplane tickets and I don't have a problem with it. Have you factored in the annual fee (if there is one?) in the pros/cons of doing this? I know the prevailing wisdom is to leave the account open, but when we did it, we closed the account when we were done with it. We chose to do this because of the following: We both have very strong credit; we bought the house we're planning to stay in for oodles of years a couple of years ago; and the only other loan we sometimes take out is for a vehicle, paying it off asap, far sooner than the life of the loan, and we get those loans from our credit union which is easier and more personal than the mortgage companies (easier to get the loan if needed). Oh, and we're set with insurance; happy with where we are. A small hit to our credit score doesn't mean much in our situation, and we don't want to have more than one credit card active. No annual fee. It is waived in this offer :hurray: The only debt we have is our house. Both vehicles are paid off. Our single cc is paid off each month (and this one would be too, no problem). I would simply use it instead of the regular one for the next 3 months. Dh wouldn't switch. When I mentioned it to him, he didn't think it would be worth the hassle, but he thought I meant getting rid of the regular one in favour of this one. Thanks. You've given me more to think about. Quote Link to comment Share on other sites More sharing options...
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