Free money

No, really, I'm not kidding. I use my Discover credit card for pretty much everything. It's easier than writing a check, and safer than carrying cash. As long as you pay the bill off every month, and electronic bill paying has made that easier than ever, there's no down side. Plus, you get cash back. For Discover, it's 0.25% on your first $1,500 of purchases a year ($4), then 0.5% on your next $1,500 ($8), then 1% after that. Hmm, I actually thought it was more than that.

I just found a much better deal. Chase has Cash Plus Rewards Visa program that offers 1% back on all your purchases, but 5% back on all grocery, drugstore, and gas purchases. It's four times better than Discover right out of the starting gate.

Say you spend $50 a week at the grocery store. With Discover, that means that you're getting back about $9 per year. Not a huge amount, but that's a couple of free movie rentals. With the Chase card, you're getting back $130 a year, which is nothing to laugh at. That means gas is thirteen cents cheaper a gallon. I've heard of people driving across town to save five cents per gallon.

Mind you, you'd better have the financial self-discipline to pay off the bill on time, in full, every month. If not, don't bother. Use cash.

UPDATE 2006-07-31: That link doesn't seem to be working anymore. Try this one instead.