When we were planning our wedding (which we planned in three months) we didn’t want to get too extravagant and end up in debt because of the wedding (not a good way to start a life together). Still we knew there would be some hefty expenses to cover. Luckily for us I got an offer for an American Express credit card with 0% interest on charges for a year.
I know, some of you may be thinking “Uh-oh credit card debt!”
Well yeah but look at how we made a new credit card work for us:
- We charged what we could on the card. This included not only wedding expenses but also the honeymoon and many other charges over the course of a year (we would have charged more but some vendors preferred cash or check).
- When the monthly bill came we paid only the minimum. I know, another red flag – Never pay just the minimum. Stay with me it gets better.
- We took as much of the remaining monthly balance as we could and put it in our ING account and labeled it AMEX. This money would only be used to pay the Amex bill once the 0% offer was over!
- Fortunately we already had money saved for the wedding so we were able to add money to our ING “AMEX” account. Essentially we could have covered the credit card bill at any time but let it sit since we weren’t being charged interest.
- At the end of the offer we paid our bill in full. We continue to use the card paying off the statement in full every month.
Basically what American Express did was give us a free loan for our wedding! On top of that we were earning decent interest in our online high-yield savings account for money that could have paid off the card. AND for the charges we made on the card we were earning rewards points as well. The points translated into a nice gift certificate to the Pottery Barn! Thank you American Express and ING!
Understand, we had to be disciplined to do this. At no time did we go crazy making charges we couldn’t already pay off. We had a plan and stuck to it.
This shows you that credit cards don’t have to be bad if they are used correctly. Money can be saved and earned in all sorts of ways. We just have to be open to how it can be done.
Let me know what you have done creatively with a credit card or online bank account!