Posted by William Charles on February 2, 2017

Published on February 2nd, 2017 | by William Charles


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No, don’t focus on cashback when you have debt. Focus on rates. If you can open a card, don’t apply for cashback/points/miles go for the longest 0% promo rate – it doesn’t hurt if they have cashback, but carrying significant amount of debt with >10% rates, the 21 month on Citi Simplicity or 24 on Santander Sphere worth a lot more than 6% cashback on travel and dining (CSR /w UR = 2c).

(Arguably the CF/CFU or BCE/BCP/ED/EDP are a good choices with their 15 month’s 0% APR)


I think that focusing on 0% APR rates is great advice for those with high-interest debt — but only if they are very disciplined. The fact that they are servicing high-interest debt in the first place would more likely indicate that they are not as disciplined as they need to be, which means they might find themselves in bigger trouble when their 0% APR period is up.

(Small note: the American Express cards are 12 months not 15).


One can get into debt even if disciplined with card usage.
And you don’t even need high interest debt to get great benefits from intro 0% – having just a 4% loan, 12 month of 0% APR with a $10k credit limit is worth up to ~$400 (charge the total limit on the card on day 1, pay minimums for 12 month, pay back full last month), only the best premium cards have better signup bonus.

OK, one probably doesn’t max out cards immediately by organic spending, but if you spend $3k a month (easy at any high COL area), so you lose ~1.5 months, and 10.5 month @ 4% = 3.5% => intro rate is worth $350. For me, the 0% rate is a deciding factor, even after I paid off all my debt, I will use my savings account rates.

My BCP had 15 month (still something like 8 to go) + $150. Depends on the offer I guess.


You sound like you’re very disciplined (and I use 0% offers in a similar way). But based on my experience, people with high-interest rate debt are — on balance — not good at managing their money flow. (I don’t intend this as a judgement or a blanket statement — debt shaming is a very real problem that prevents people from seeking help and I don’t want any part of it!).

Properly getting out from under high-interest debt requires a good budget and few unforeseen circumstances (losing a job, etc), and I’m wary of a blanket recommendation of 0% APR offers because it’s so easy to wind up back in the same hole if you don’t have the money to pay it off at the end. A personal loan with a fixed monthly payment can wind up being a much better option for many people, even though it costs more in the near-term.

(you’re totally right about the BCE/BCP — it’s only the ED/EDP that are 12 mos)

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