Savings on credit

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#1
I never believed in having too many credit cards. Right now, I only have one credit card with me which I use for rebates and discounts. Smile

Jan 16, 2011
Savings on credit

Multiple credit card holders are using their cards to get discounts and rebates at stores
By Nicholas Yong

Singaporeans are flashing credit cards like never before, but give them credit: Burnt by splurging, some become savvy users.

At least that is what a check by LifeStyle has found.

While figures earlier this month from the Monetary Authority of Singapore showed that the number of credit cards issued in November crossed the six million mark for the first time - working out to six to seven cards a person - it turns out that some holders are choosy users.

The cards do not just pay the bills, but are also lifestyle options, with card holders telling LifeStyle that they use different cards to get what they want from plane tickets to cash rebates to store discounts.

Take, for example, businessman Chris Quek, who accumulated his eight credit cards during a season when banks were 'almost throwing credit cards at you'.

He says: 'I use mainly one primary card, with the rest for specific purchases at specific venues.'

For example, he has two OCBC cards co-branded with furniture chain Ikea and department store Robinsons that give him cash rebates and exclusive privileges.

'For married people of my age, these cards are very important as we do a lot of shopping at such places,' says the 31-year-old, who is married with a baby on the way.

Other cards give him discounts on petrol and dining, while another two are used specifically for his business.

With credit-card promoters everywhere and banks quick to waive membership fees, accumulating credit cards is easy.

Medical representative Steven Yong, 29, recently acquired a ninth credit card and does not rule out getting more 'if there are good cards with attractive benefits'.

But for business controller Amelia Tan, in her 30s, some of her 12 credit cards do not even see the light of day.

She says: 'Some I use for specific purposes like dining and some of them I don't use at all. But I hold on to them because you never know when they will come in handy.

'I've never had to pay for the cards. If they don't waive the annual fee, I'll just cancel it.'

Ms Tan, who says she is no spender, restricts herself to spending just about $1,000 a month on two primary cards.

But industry analysts caution against holding more than two or three cards.

Multiple card use can lead to multiple debts, which could over-stretch a person's ability to repay them.

The likes of Mr Quek have already gone through the over-spending phase.

He now restricts himself to spending $2,000 a month on shopping, entertainment and dining, and carefully scrutinises his receipts.

'I realised that I was over-spending and my savings were dwindling. So I cancelled quite a few cards and now I'm very disciplined,' says Mr Quek.

Ms Tan Huey Min, general manager of Credit Counselling Singapore, has this advice: Select two or three cards that best serve your lifestyle and cancel the others so that it is easier to keep tabs on your expenditure.

She says: 'This could reduce unnecessary expenses such as annual subscription fees and unnecessary spending due to readily available credit facilities or discounts and rebates offered by the various cards.'

nicy@sph.com.sg
My Value Investing Blog: http://sgmusicwhiz.blogspot.com/
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#2
Personally, I have many credit cards.

The best combo is NTUC fairplus with Citibank SMRT.
For purchases above $20 at NTUC extra, the customer can use NTUC fairplus for linkpoints(1.3% per $1 spending) and SMRT card for supemarket rebates of at least 4.7%.
A total of 6% rebate Big Grin

OCBC Ikea has free kopi at Ikea restaurant.

POSB card got rebates for starhub bill, utilities, car park and town council conservancy fee.

I think if a person is a spender, it does not matter if he/she has one or more cards. The card limit will be max out, transfer to credit line, max out again, borrow from relatives, max out again.....

Self control is the key and since the bank is offering rebates here and there, I am glad to apply any card that is useful.

As for annual fee, wait long long... I will not pay a single cent.
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#3
I guess it really depends on your lifestyle. I used to have more credit cards as I was eating out a lot more and the different cards are useful when dinning at different restaurant. As I dun dine out as often as I used to, I cancelled a lot of cards (those that refused to waive the annual fees)

My 2 main credit cards are American Express Black (1.5x rewards pts) and EssoPlantintium for pumping petrol.

I just managed to get my OCBC Titanium card annual fees waived so I will continue to hold on to it (though I seldom used it much)

Its quite easy to get the annual fees waives nowadays (compared to 4-5 yrs back). DBS even automate the annual fee (and penalty fee) waiver process that you dun even need to speak to their CSO nowadays!
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#4
Limit orders in kick and put the money you would have spent on it in their savings account.Create an automatic savings plan. Talk to your bank about getting a 1-2% of all income in your bank account to your savings. If you have gone straight to the top, do not miss, and can help you save for that rainy day.
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