This “great deal” illustrated above recently popped up on a shopping deals site I visit from time to time. It’s at best a 2% cash back credit card (but read the fine print…). Everything you need to know about how these things work in reality, and why they are a joke is spelled out in the listing. The real-life example given by the poster of this deal  says that as much as possible was charged to this card (which as we know, leads to overspending to collect rewards). The person received “almost” $1000 in rewards over five years. Could be $800, $900, who knows. But let’s be generous and say it’s the full $1000…over five years….divided by 5…is $200 a year….divided by 12… $16.67 a month.

That’s the discussion we are having. Putting your entire personal economy, literally several thousand dollars charged to a credit card each month – and spending more, potentially hindering your savings and investing goals – for a whopping $16.67 a month in rewards.

A couple of trips to the coffee shop. Barely one lunch. Half a tank of gas – maybe.

Don’t muddy the waters of your personal financial plan, thinking you’re getting ahead with credit card rewards. If you pay even one month’s interest you will have negated all rewards. Coupled with the increased spending, this is nothing but a bad plan. Is it normal? Yes. But remember, normal is broke. Don’t be broke. Don’t be normal. Don’t fall for their marketing. Use your debit card. Use cash. Create your own rewards!