Your Book is a Joke, Barefoot

Question


Dear Barefoot Investor,

I had three separate friends recommend that I read your book, so I gave it a try. I have to admit I was enjoying it, until I got to page 79. That’s when you started talking about credit cards, and you showed you have no idea.

If you really area money guy, surely you could make credit cards work for you? If you like, I could teach you how to use the banks to get serious rewards. Maybe you could join me in first class … or maybe they don’t let people in without shoes?

Matt

Scott's Answer


Hi Matt,

Bang! You sure schooled me.

The truth is that I have my own rewards scheme going on — but it’s got nothing to do with flights, or toasters.

Let me explain:

It’s no secret that the banks have been playing hokey-pokey with the value of rewards points for years — but right now it’s just getting ridiculous. These days, getting a reward from your credit card is almost as hard as getting a reward from your wife after seven years of marriage.

Case in point: over the past 12 months, the banks have been secretly shutting down, or radically reducing, the value of their rewards cards. According to financial comparison site, Mozo, the banks have yanked the value of their rewards points, on average, by a staggering 63% in the past year alone.  

Bottom line: the value of the points, and the restrictions on redeeming them, will only continue to go one way — down.

So what’s my rewards program?

Well, it’s not having to bother playing the rewards point shuffle. It’s not having to worry about innocently missing a repayment and being slugged with back interest for the month. It’s not having to pay a hefty annual fee.

But Matt, do you know what the platinum-titanium-reward-of-them-all is? I’m modelling good habits for my kids. They’ll grow up knowing Dad doesn’t do credit cards. That’s a powerful message, and for me that’s the ultimate reward.

Thank you for reading.

Scott