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12 • What does a Cash Back
Credit Card really Give Me?

We choose to use credit cards for all the wrong reasons. Eight years ago I opted for a Royal Bank Avion card because I was seduced by the idea of saving up a whack of travel points to cash in for a great family holiday someday. What a ruse! Air mile points convert to 1.5 to 3 cents per mile! It wasn't smart financial planning. While I've earned 165,000 in points (worth about $1,650 in airfare), I pay total annual fees of $170 to use the card. Over these years that alone amounts to $1,350. And then you consider that I sometimes carry a balance and am charged a hefty 19.5 per cent in interest on top, this is a real money maker for the bank, and only the bank has benefitted from me having that card far more than what I truthfully have to show for my money.

Give to take

Cash Back really means… WoW look at what a good cash cow you are! We are harvesting so much of your hard earned cash that we don’t want you to notice. So we are making a big deal about how much we are giving you for using our credit card that you won’t notice just how big a fish you really are. This is a just distraction ploy to keep their cash cow content to prevent you from really looking at how much money you waste on renting money for little or no reason!

When you Understand Credit, You will have Great Credit!