/biz/ - Business & Finance

>>1002422

>You must get into debt and stay in debt before you can get into even more debt.

> buy a candy bar with credit card for $1.50.
> credit card gives 1% off purchases.
> candy bar is now $1.485; saved $0.015.
> xfer $1.50 from bank to credit card

Now lets maximize that on a larger scale without green-text for more detail:

You have car insurance, electric, cell phone, gas, food, and other purchases in order to live day-to-day. Lets compare two separate individuals involving their purchases.

[0] Anna - No Credit / Bad Credit

- Car Insurance: $100 month
- Electric: $120 month
- Cell Phone: $50 month
- Gas: $60 month
- Food: $180 month
- Other: $50 month

Total: $560 a month / $6,720 a year

Anna has to pay for everything listed above with either cash or debit. Anna doesn't receive anything in return being a responsible conductive member of society.

[1] Maria - Average Credit / 2% Credit Card

- Car Insurance: $100 month
- Electric: $120 month
- Cell Phone: $50 month
- Gas: $60 month
- Food: $180 month
- Other: $50 month

Total: $560 a month / $6,720 a year

Maria pays for everything listed above with her 2% credit card. She receives 2% off every listed item above, for being a responsible individual. But how much does she actually save/gain though? Is it actually worth it for Maria? Lets find out:

- Car Insurance: $100 - 2% = [ $98 month ]
- Electric: $120 - 2% = [ $117.6 month ]
- Cell Phone: $50 - 2% = [ $49 month ]
- Gas: $60 - 2% = [ $58.8 month ]
- Food: $180 - 2% = [ $176.4 month ]
- Other: $50 - 2% = [ $49 month ]

Total: $560 - 2% = [ $548.8 a month ] / $6,720 - 2% = [ $6585.6 a year ]

By simply swiping her credit card, she has saved $134.4 a year and $11.2 a month.