credit cards

Credit Cards: How I’m Winning

If you’ve followed my story, you probably know that I’ve been very anti-credit cards for the past 5 years. I’ve been following Dave Ramsey’s Debt Snowball to pay off my student loans, build an emergency fund, save for retirement, and prepare for a downpayment on a house. For those of you who aren’t familiar, the name Dave Ramsey is synonymous with being anti-credit and anti-debt. While following Dave Ramsey has been a great way for me to get ahold of my finances and set myself up for success, a few months ago something changed. I decided if I wanted to buy a house someday with an affordable interest rate, I was going to have to play the credit game.

I knew the two fastest and easiest ways to build a credit were (1) taking out an auto loan or (2) applying for a credit card. Since my 2006 car is still alive and kicking, knock on wood! I decided the best route for me to build my credit was to apply for a credit card. While the average American has $6,375 in credit card debt, I’ve been able to avoid going into debt, and instead reap the cashback rewards. By combining basic human psychology with a little trial and error, I’ve been able to win the credit card game, here’s how I’m doing it.

Choosing the Right Credit Card

Before I opened my first credit card, I did a lot of research. I knew I was going to avoid store credit cards at all cost. In college, I worked for Gap and I know how useless it is to have a store credit card. Store cards offer the best deals and rewards for shopping that particular brand. Store credit cards charge a lot of interest for carrying a balance. Plus, they subconsciously encourage you to overspend with a particular store brand in order to reap the rewards.

Being the Frugal Millennial, I try to be brand agnostic. That’s not to say I don’t favor certain brands and stores, but rather than forcing myself to shop at one particular store all the time, I always do my research to make sure I am getting the best deal. I know myself well enough that if I had a store credit card I would be tempted to shop at that store more often, even if I wasn’t getting the best deal. With this in mind, any store-specific credit card was not an option for me, sorry Amazon.

No Annual Fees

In order to choose the best credit card for me, I headed to Nerd Wallet’s website. My number one requirement was that it didn’t have an annual fee. Call me old-fashioned, but I was not about to pay an annual fee to carry around a piece of plastic. To pay $99 or even $69 per year to swipe a magnetic piece of plastic is ridiculous.

I know some of you out there are going to tell me there are amazing credit cards that carry annual fees. I’m sure there are, but those cards are not for me. I spend very little. In fact, I calculated what my annual rewards would be if I kept my normal spending habits. Any rewards that I would earn would be offset by the annual fee. In order for me to maximize my rewards, I needed to find a card that did not have an annual fee.


After I filtered through cards without annual fees, I looked for credit cards that offered cashback. I wanted to be in charge of how I earned and used my rewards. I didn’t want to be limited to airline miles which often expire and are tied to one airline. In essence, I wanted straight cashback on every purchase.

Beyond that, I didn’t want the cashback to be determined by rotating categories. I know myself and basic human psychology. If I chose a card that used rotating categories to reward my spending, I would alter my spending habits to fit within those categories so that I could earn more cashback. I needed to find a credit card that fit into my lifestyle, not the other way around.

My Favorite Credit Cards

After doing hours of research, I narrowed my top choices to the following list. Keep in mind, all of these cards offered cashback and $0 annual fees.

My top choice was the Citi Double Cash Card. This card offers 1% cashback on all purchases and an additional 1% cashback when you pay the bill, for a total 2% cashback. Plus, it was a nice incentive to pay the card off in full every month and earn the additional 1% cashback right away. If you’re a regular Frugal Millennial follower, you know that I applied for and was rejected from the Citi Double Cash Card.

My second choice was the Fidelity Rewards Visa Signature Card. I liked this card because it offered an unlimited 2% cashback on every purchase with no annual fee. Even more, your cashback could be added to your existing Fidelity investment account. Check out how much more you would earn over time by investing your cashback rewards.

My third option was the Chase Freedom Unlimited card. With this card, I would earn 1.5% cashback on each purchase. While the cashback amount isn’t as high as the Citi Double Cash or Fidelity Rewards Signature Visa, in the grand scheme of things 0.5% was going to be a difference of an extra few dollars a year.

Winning with Credit Cards

Create a Budget

I talk about the benefits of budgeting constantly on my blog. If you want to win with money you need to create, and stick to, a written monthly budget. I’ve had roughly the same monthly budget for the last 3 years. I know exactly how much money I can spend each month in order to have fun and build wealth. When I opened my first credit card I didn’t change my spending habits. As I mentioned, my spending habits are so consistent that before I even opened my credit card, I calculated how much I would earn annually in cashback rewards. That way, I wouldn’t be tempted by the allure of earning more cashback by spending more than I normally would.

Being frugal doesn’t have to be boring. As long as you save and budget, you can afford anything.

By sticking to my regular monthly budget and not altering my spending habits, I have not only been able to pay off my credit card in full, every month. But I have also been able to continue to build wealth. I’ve been able to avoid the credit card trap that so many Americans fall into and it started by creating and sticking to a written monthly budget.

Use One Card

You know the saying, “keep it simple, stupid”? That’s how I try to keep my finances. The more you complicate things, the more likely you are to make errors. I only have one credit card and put all of my purchases on it. I don’t worry about using a specific card for travel purchases, another card for gas, and yet another for groceries. It’s too complicated to remember which card to use for what and even more complex to remember which card needs to be paid when.

If really stop to think about how much more cashback you would earn by using multiple cards it’s probably marginal. Unless you’re a big spender, it’s probably not going to be worth the time and hassle to use multiple cards.

The Credit Card Game in a Nutshell

I consider managing finances like playing a game. At the end of the day, there are winners and losers. If I’m able to spend wisely and budget accordingly, I consider myself a winner. On the other hand, the months when I let myself spend frivolously and overspend (yes, I am human), I consider myself a loser. By sticking to a written monthly budget and choosing a credit card that fit into my existing lifestyle, I have been able to avoid credit card debt and instead reap the rewards. In essence, I have been able to win with credit cards.

Stay Frugal. Stay Fiesty.


Frugal Millennial Budgeting Infographic

Millennial’s Guide to Budgeting

If you want to get ahead and accomplish your #financialgoals, you need a monthly budget. Most Millennials graduate college with a fancy college degree but no idea how to manage money. The first step to tackling your finances is to create a monthly budget. I get it, you hear the word budget and you want to run for the hills. Most people cringe when they hear that dreaded b-word. But just hear me out, budgeting doesn’t have to be boring, overwhelming, or confusing.

I’ve been studying budgeting for the last 5 years, I’ve read over 50 books on the subject (can you even believe there are that many books out there?!). And I think I have a pretty good idea of what all of the major financial experts have to say about budgeting. But in all of my research, I keep coming across the same issue. The way budgeting is presented is complicated! Most people suggest using percentages and ratios, lots of spending categories, and that gets overwhelming.

Worry not, my fellow frugal millennials! Over the past 5 years, I’ve learned a few things to take the drudgery out of budgeting. First things first, download and print your own budgeting worksheet.

Step 1: Calculate Your Income

Before you can even begin to think about how much you can spend, you need to figure out how much you make. This isn’t complicated. Since it’s 2017 I’m assuming your employer pays you via direct deposit. Log into your bank account and see how much your employer deposits into your account each pay period. Then, figure out how often your employer pays you. Are you paid weekly, monthly, bi-weekly, or bi-monthly?

Let’s say you take home $1,000 on the 15th and 30th every month. In total, you take home $2,000 every month. That was easy! Now that we know how much money you are bringing in each month, let’s figure out how much we should spend.

Step 2: Calculate Your Rent

For most of us Millennials, our rent is a fixed rate and you’ve probably signed a year-long lease. While most financial experts recommend spending 25%-33% of your take-home pay on rent, you’re probably already stuck in a lease for the next several months. So, while your rent should be somewhere between $500-$660 per month (using our $2,000/month take-home pay example), you may be spending more than that.

Step 2.1: Budgeting Utilities

If you’re lucky, your utilities may be included in the cost of your rent. This makes it easy for you to plan ahead and know exactly how much you’re spending each month. If you’re not as lucky, and you are responsible for your varying utility costs, you’re going to have to take a few extra steps.

Electric, Gas, Water & Sewage

Look at your electric, gas, water & sewage bills over the past year, this should be as easy as logging into your online account and looking at your payment history. Calculate your average monthly spend and put that into your budget. This cost shouldn’t vary too much from month to month, but know that depending on your consumption habits you may be a few dollars over or under each month.

In your budget worksheet, fill out how much you spend on rent, and if applicable, add that to your average utility spend per month. In our example, let’s say you pay $500 per month for your apartment and all of your utilities are included. Go you!

Step 3: Budget Your Car Insurance

If you drive a car you need car insurance. This isn’t just me going on a rant encouraging you to get insurance (side note: you also NEED health insurance to protect yourself from bankruptcy). Most state laws require you to have car insurance if you drive your car. If you’re pulled over by the police and don’t have car insurance you better bet you’re going to get slapped with a major ticket. Save yourself the ticket and headache and make sure you are insured.

Your car insurance should be a fixed monthly rate that you pay every month.

In your budget worksheet, fill out how much you spend on car insurance each month. For our example, let’s say you pay $100 per month on car insurance.

Step 4: Budget for Your Cell Phone

I’m going to go ahead and assume that we all have a cell phone, and most of us have fancy data plans to go with them. The most affordable way to use your cell phone is to stay on a family plan for as long as possible. With a family plan, the cost is much less than if you were to get your own individual plan. In fact, what you would pay on a family plan is often half of what you would pay on an individual plan.

Calculate what you pay for the actual phone (if you’re leasing the phone through your carrier). And calculate what you pay to use the phone every month. Add that up and put it on your budget worksheet. In our example, let’s say you pay $30 per month to lease your iPhone plus $20 per month to stay on your family’s cell phone plan.

Step 5: Budget for Groceries

Your grocery category is one category where you can really save a lot of money. Most people spend way too much on groceries that they end up throwing away. The key to saving money on groceries is to go into the store with a plan and stick to that plan! If you’re a single person, shopping for yourself, I recommend spending between $125-$150 per month on groceries. That breaks down to $31-$37 per week on groceries.

Check out my post on how I grocery shop on a budget for more details on how to slash your grocery bill. Then, fill out the grocery section of your budget worksheet.

Step 6: Budget for Gas

If you own a car, you probably need to fill it up with gas every once and a while. Calculating how much you spend on gas every month isn’t too hard. Figure out how often you fill up with gas, and what your average spend is. I fill my car up with gas every 2 weeks. Each time I spend around $40. I give myself a bit of a cushion and allow my gas budget to be $100 per month. That extra padding helps if I take a road trip or if gas prices end up skyrocketing–which they sometimes do in California!

Calculate your gas budget and add it to the gas portion of your budget worksheet.

Step 6.1: Budgeting Parking

If you have to pay for a monthly parking pass for your apartment complex or work you’ll need to add this into your budget. If you only pay for parking every once and a while when you go to events, you can include that expense in your “miscellaneous” category.

For our example, let’s say you also budget $100 per month on gas and don’t’ have to pay for a monthly parking pass.

Frugal Millennial Budgeting Infographic

Step 7: The Miscellaneous Category

The miscellaneous category of my budget is my favorite and soon it will be your new favorite, too! I put all of my other monthly expenses in my miscellaneous category. This includes going out to eat, getting my hair/nails done, buying clothes, toiletries, etc. Some financial experts will tell you that it’s better to break your miscellaneous category into smaller, more manageable categories. If that works better for you, then by all means breakup your miscellaneous category.

Keeping One General Miscellaneous Category

For me, keeping one large, general category has really helped me stay on track and spend less. When I first started budgeting regularly about 5 years ago I split my budget into many little categories. But I found that I was overwhelmed as to how much money I should put in each category. And what about expenses that occurred frequently but not every month, like getting my nails done or buying shampoo? Ultimately having so many categories caused me to spend way more than I do now and it took me a lot longer to create the budget at the beginning of each month.

And thus, the general Miscellaneous Category was created.

Budgeting for Miscellaneous

You can decide how much you want to spend on miscellaneous items every month. To give you a point of reference, I budget $500 per month in my Miscellaneous Category. I break that down into $100 weekly increments and give myself that extra $100 to splurge on a random shopping trip, day trip, or an afternoon at the salon.

For the most part, I try to save my $100 for the weekend. I know that by the time Friday night hits, I’m going to want to grab a drink with my friends, head to a movie, or grab a meal out. Realistically, $100 is enough for a few budget-friendly weekend activities or one extravagant experience.

There was a time when I was going out to lunch and happy hour during the week and found that I was spending my weekly miscellaneous budget during the work-week. By the time the weekend rolled around, I had no money left to spend. I was either really cranky from being a shut-in. Or, more often than not, I was spending $800 per month on miscellaneous items.

Decide how much you want to spend on miscellaneous items each month. Add that amount to your budget worksheet.

Tying Your Budget Together

Once you’ve determined how much you’re going to budget for each category, you need to start tracking your expenses. Tracking your expenses is going to be the key to your success. If you don’t’ track your expenses, how do you know how much you’re spending? You don’t. And odds are, you’re going to end up overspending.

There are 2 apps I like to use: Mint and EveryDollar. Personally, I use EveryDollar more than Mint. I’m just more accustomed to EveryDollar than I am to Mint. Both apps are equally as good. Budgeting Worksheet Filled Out Example

You’ll notice my budgeting method is pretty simple and straightforward. In a nutshell, I try and spend as little as possible so that I can save at least half of my income. In the example above, we end up spending $1,375 of our $2,000 take-home pay. That means we end up saving about 1/3 of our take-home pay or $625 every month. That is a great start! You could put that $625 to work, either to pay off debt or invest in retirement.

You’ll also notice, I didn’t add that $625 to a new category on the budget. There’s a reason for this: out of sight, out of mind. For me, if I see that amount printed on my budget, I know I would be tempted to spend it. Instead, I set up autopay to either pay off debt or invest in retirement. Trust me, if you forget it’s even there, you’ll end up saving a lot more.

Comment below with questions, and happy budgeting!

Should You Get the Venmo Debit Card?

Among the many FinTech companies looking to edge their way into our everyday lives, Venmo has unleashed a new debit card. Following suit from companies like Square, the Venmo Debit Card is looking to make waves in the financial sector.

Who Can Get the Venmo Debit Card?

According to TechCrunch, only a few select users have access to the Venmo Debit Card right now. Because the card is still in beta, Venmo is still working out the kinks. If you’re eligible to test out the Venmo Debit Card, you will see the offer in your Venmo Account. The invitation appears at the top of your Venmo feed.

What Can I Do With Venmo’s Debit Card?

You can use Venmo’s Debit Card the same way you would use any other debit card and you can use it anywhere Visa is accepted. Which, in this day and age, is pretty much anywhere that accepts credit cards. You can use Venmo’s physical debit card at stores, restaurants, gas stations, grocery stores, etc. The only difference is that this debit card is linked directly to your Venmo account. And you’ll also have to link your Venmo Debit Card to your bank account. If you don’t have enough money in your Venmo account to cover the cost of the purchase, Venmo will pull the balance from your bank account.

What Can I Do With Venmo's Debit Card?

Should I Get the Venmo Debit Card?

Once Venmo releases the card to the general public, you will have the option to decide if you want to order one. According to TechCrunch, the major drawback to the card is “the card design is really, really ugly. It’s literally a picture of a ball of pizza dough with some white flour sprinkled on top”. According to TechCrunch, Millennials care about the design of their debit card and would never opt for such an ugly card. I have to disagree, the design of a card should be the last reason on your list. If you only choose cards based on their design, we need to talk.

I’m interested to see what Venmo will say once they release this card to the general public. At this point, because there are no major benefits to this card, I wouldn’t recommend grabbing one for yourself. Adding another debit card to your wallet only increases your risk for fraud. What happens if you lose your wallet at the bar or on the train? You have yet another card linked to your bank account that you need to remember to cancel. The best financial advice I’ve ever received is “keep it simple, stupid”. No need to complicate your life by adding yet another card to your wallet.