Michelle and I are “deadbeats,” and proud of it! To credit card companies, a “deadbeat” is a cardholder who pays their balance in full every month. This avoids interest, which represents most of the card issuer’s profits. A “good customer” is one that consistently carries a balance, accruing interest.
Living a mostly subsistence lifestyle with no steady income, you’d think we’d be strictly cash-and-carry. Actually, credit cards form an important part of our financial strategy.
Americans are caught in the credit web. The system is designed to draw us into debt and ensnare us for life.
Like it or not, a major credit card is almost a necessity in this society. Why else are major credit cards better personal identification than government-issued I.D., including driver’s licenses? That’s so wrong, but it’s true!
We use credit cards to “abuse” the system. Most credit card companies offer some sort of premium—often a rebate of 2% or more of one’s annual spending.
If one has self-discipline—and that is absolutely vital to success—these premiums represent added value. To get the premiums, we charge every purchase we can, always paying what we owe at the end of the month. This obviously requires that we not exceed available funds.
We use credit cards for very specific uses. We try to buy locally, but some items we need just aren’t available. In the Internet age, purchases are most convenient with credit. Our most active card accrues frequent flier miles on Alaska Airlines. It takes awhile to earn a free ticket at our rate of spending, but it represents significant savings. The required spending exceeds the cost of a ticket, but we receive other goods and services for that expenditure—the ticket’s a bonus. This helps, since Alaska Airlines has a complete monopoly on Southeast Alaska—there are no other carriers to choose from.
Some merchants offer discounts for paying cash. Credit transactions are a burden that most businesses are forced to bear for fear of losing customers. We try to help when we can, but are even more likely to do so when there’s an added advantage to us.
Maximizing benefits means remaining flexible and vigilant. If there’s any threat of increased fees or decreased premiums, we complain. If benefits don’t exceed fees, we ask for a lower level of service in return for no fee. We hardly need most of the “benefits” cards offer, just the lowest level that provides cash or mileage.
We’ve held our cards for years, and the companies seem averse to losing us. Often a call to customer relations changes the agreement to our advantage. If not, we will cancel the card, since it’s no longer benefiting us. We show no mercy, expecting none from a business that labels a customer who pays what’s owed when it’s due a “deadbeat.”
You will find a version of the essay above, as well as writing on similar and related topics in the ebook, Sacred Coffee: A “Homesteader’s” Paradigm by Mark A. Zeiger. The ebook version will likely be expanded, clarified, or updated from what you have just read.