Friday, February 21, 2014

Get Paid More to Spend Than Save

It is ironic that in the USA today, you get paid more to spend a dollar, than to save a dollar.  I believe it is the same in Canada.

If you save a dollar, the best online savings account will pay you 0.85% to 1.0% per year in interest.  Bond funds might pay you 2-4%, but you may lose money if interest rates go up.

On the other hand, with the right choice of credit cards, you get at least 1.5% back on all purchases and up to 5% on categories like gas or restaurant purchases.  This is paid to you within a month or at worst within a year, depending on the card.  You can also get miles, discounts, or dollars just for opening a new credit card account.

Is it any wonder that household debt is rising in the US and Canada again?

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