Buzz
Not all life hacks are equally effective. Some DIY projects can end up costing more or taking longer than simply buying the item you wish to recreate. Some goals take too long to reach, and some hacks are only useful to a select few.
One hack on my list that probably isn’t worth the effort: paying an additional fee just to use a credit card for purchasing a product or service. If the rewards you get from cash-back exceed the fee, you may come out ahead, right?
Reddit user EMF911 shared their insight in the r/frugal subreddit:
I had a personal tax bill to pay. When I called the payment office to ask about credit card payments, the receptionist informed me that they do accept credit cards, but there’s a $5 fee.
My credit card offered a 2% cash-back reward, and the bill was for $310. Two percent of $310 would net me $6.20 in rewards. After paying the $5 fee, I would still come out ahead—making this payment method worth it.
EMF911 also pointed out the added benefit of paying with a card, like improving your credit score. A few others agreed, noting that when the fee is less than the cash back you earn, it’s worth the cost. Of course, you need to be someone who avoids carrying a balance on your credit card month to month to truly benefit.
If you’re like this Redditor and are comfortable using credit for almost everything, you probably wouldn’t hesitate to make this choice.
However, for most people, the potential for error is simply too high. A recent survey by Bankrate found that 38% of Americans consider staying current or catching up on bills their top financial priority.
Using a credit card to pay a bill—and accepting the added fee—might be necessary if your budget is tight. However, the habit of relying on a credit card for everything can quickly lead to debt. If you're not paying off your full credit card balance each month, any rewards from cash-back are quickly outweighed by the interest charges.
Not every money-saving strategy carries this kind of risk—DIY mishaps are usually low-stakes—but when it comes to your finances, playing it safe is sometimes the best choice. Would you prefer to save a little now, or pay upfront for the chance to get a small return later?
