Money Monday: Fighting Inflation

The number one economic or financial challenge we are facing today is inflation. With so many contributing factors, from stimulus to international war, the critical question now is how can we reduce, if not control, inflation without creating a recession? While the experts debate and strategize, you might want to consider ways in which your credit card rewards programs can help mitigate some of the economic pain at this moment. For example, some credit card rewards programs have provided rebates as high as 6% on supermarket spending and 5% on your gas bill. Regarding rewards cards, one thing to note is that no one card provides the same reward percentage across the board. For example, on some cards, you may be eligible for a greater percentage in rebates or cash back rewards in some categories such as travel, shopping, or leisure spending instead of necessary categories. Let’s look at some of the credit cards that offer better rewards or cashback options.

Chase Freedom Flex Card

This card will provide a signing bonus of $200.00 if you spend $500.00 in the first three months, but to me, that’s not the best part of this card. What I find attractive is that for the first 15 months, your APR (Annual Percentage Rate) is zero, and you receive 5% back on gas purchases, up to $6,000.00 in the first year. If you are a family with one vehicle and have a pulse, you currently spend a significant amount on transportation costs. Perhaps 5% of $6,000.00 ($300.00) may not seem like much, but I’m of the mindset that saving a little in each area of your budget will amount to much over time. It’s the compound interest concept being applied to your spending. There is also a 5% back on up to $1,500.00 spent on what is referred to as rotating categories. The options are worthy of consideration as you think through solutions to fight inflation.

Consistent Cash Back Rate

Perhaps you prefer to keep it simple and can’t manage all the changes in rebates and cash backs and which category applies to what; well, there might be a solution to your struggle. Wells Fargo bank provides an Active Cash Visa Card, which will give you 2% across the board. Therefore, it does not matter what you purchase; the reward is the same. This simplicity will allow you to walk around with one credit card and not several attempting to figure out which option to exercise and when. One nice wrinkle with this card is that you can get up to $600.00 of protection for your cell phone if damaged or stolen by paying your cell phone bill using this credit card. How about that!

Low-Interest Rates

While this article is about using your credit card rewards to help fight inflation, it would be financial literacy and stewardship malpractice if you acquired great rewards on a high-interest rate credit card. The Wells Fargo Reflect Visa card offers a zero percent interest rate for the first 18 months on credit card transfers and balances. However, you can extend that period for an additional three months if, during the first 18 months, you pay at least the minimum balance on time. One person said, “Too many people spend money they earned to buy things they don’t want, impress people they don’t like.” Spend wisely!

WHAT’S UP!

Today’s what’s up, I would call credit report BREAKING NEWS. Beginning in July 2022, any new medical debt sent to collections will not be reported or show up on your credit report for another year from when the debt was sent to collections. This would give you time to address the problem without impacting your credit. In addition, any medical debt reported to a collections agency but was eventually paid off would be removed from your report on all three credit reporting agencies. Finally, for you shopaholics, BNPL (buy now, pay later) transactions will be included or evaluated on your credit report moving forward. Be careful what you wish for. And that’s what’s up!

Ruthven R. Phillip, Esq., is a tax attorney, Stewardship and Philanthropy Ministry Assistant, and CEO of Give2Getrich, LLC. Give2Get Rich, LLC 2022. All Rights Reserved. Any distribution or reproduction of part or all of the contents in any form is prohibited.

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