I’ve been looking at articles about credit cards and a lot of them say to keep credit card utilization under 30%, ideally under 10%. If that’s true, does that mean cashback should rarely be above $1-2 per month? Is cashback a strange way to lower your credit score in exchange for small amounts of money? I couldn’t find anything explaining the relationship between these two opposite mechanisms of credit cards. Thanks.
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Cash back and other incentive programs exist to make you want to use your credit cards more.
Sound financial advice about minimizing debt and such is a threat to the credit card companies.
They’re completely opposite things.
The credit card companies are literally willing to pay you (a relatively tiny amount) just to ignore that advice.
That said, there’s absolutely nothing wrong with using credit cards **RESPONSIBLY**.
Buy stuff on credit, immediately pay off the balance, reap the rewards, never pay insane finance charges.
Of course that only works if you only use a credit when you could just as easily pay cash. And most people can’t always say that.
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