What's better? Living off a credit card vs 2% ING cashback

Hi guys,

Thoughts on what is the better option here:

Pay complete salary into high interest savings, live entirely off a CC (Bankwest Platinum for example) and then pay it off each month after the interest has collected from the savings account.

OR

Use the ING 2% visa debit for all purchases.

I haven't done the maths (thats probably the next step for me) but I feel like option one would yield better results?

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Comments

  • +4

    the maths was done in another thread recenetly, most credit cards werent as good as ing 2%.
    http://i.pictr.com/rzzc3laxo7.png
    done 2 months ago.

    • Yeah that's fair enough. I guess my point is that you're earning more interest in your savings by dumping your entire pay in there, rather than paying for things with it.

      • +3

        the image takes into account the savings you get from that, which is comparision not very much. (only 0.57% AND thats assuming you bought everything on the first day of the month cycle. So in reality its a bit less even).

        Points from CC would be where most of your money would be saved, through getting giftcards from points. (If its worth it, if theres an annual fee).

        ING 2% is great, if you managed to get one of their 5% deals, even better.

        Obviously ING only gets the cashback on paypass purchases, so I use credit card for all other purchases (citi platinum)

  • +2

    Why wouldn't the ING option not also accrue interest?

    Pay your salary into an ING online saver and transfer a portion into the everyday account. Rinse, repeat or are you living on the line from pay cheque to cheque.

    • But you're not earning maximum interest on it because you're using it to purchase things?

      • Yes, but why do you need to have all your money in one account at any given time.

        You do the maths on your monthly expenses. I don't see why you couldn't just transfer the odd $100 out of your interest generating account, for the weekly groceries.

        • nah the point is with ING you're only earning interest on savings until you make a purchase (assuming you transfer to everyday orange just before purchase). Whereas with credit card you don't need to pay it off until up to 55 days later so you're earning interest 55 days longer.

        • @lolmao:

          This.

        • @The Quote Train: Your right, but the money saved is not very much (saving between 0.30% - 0.57%ish when keeping the money for purchases in a savings account with about 3.8%pa, compared to saving 2% with ING which is much better )

  • +2

    Note also, Mebank has 5% cashback going on at the moment. which trumps everything.

  • Pool all money in an offset mortgate account / high interest saving account, transfer a few hundred dollars into ING orange account regularly or when balance low. Keep a credit card at hand for occationally big spending or non-PayWave transaction.

    Most handy if you have all mortage, high interest saving and orange everyday accounts with ING Direct.