85% of People Are Using Credit Cards WRONG

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Video Transcript:

I love getting cash back for my credit
cards. It makes you feel—wait… I owe $14,000?! Credit cards are like
sweet potato pie. No they're not! Either you hate credit cards
or you love them, there's no one between, kind of like sweet potato pie. I only use
a credit card to make my purchases, I don't even own a debit card and I hate
using cash, because my credit card pays me to use it—But, it has been brought to my
attention that a lot of people are not using their credit cards the right way.
Nope. Can't even look at you right now… That's why today I'm gonna go over 7
ways you are using your credit cards wrong, so make sure you watch this video
until the end, but, before we get into that hit that, thumbs up button below
because it's kind of like a virtual high five, and subscribe to the Minority
Mindset YouTube channel, that way you don't miss our new videos every single week.
First, you are spending what you don't got.

There are about 250 million adults
in America, out of which 70% own a credit card, which is about 175 million, now out
of those 175 million people, just over half of them—or 95 million of those
people—have out standing credit card debt, and they are losing in the credit
card game, because they are paying a crazy interest rate on every single
purchase they make, while 80 million of those people are winning in the credit
card game because they are getting free trips, perks, bonuses, and cashback just
for using their credit card. I want you—put a smiley face here—to be
in this minority of the people, and not be there. Credit cards are a tool that
amplify your spending habits. If you cannot control your spending, credit
cards are going to fuel your bad financial habits, so if that's you, you
should not be using a credit card. But Jaspreet! What about my cash back?!
One percent cash back doesn't make up for the twenty five percent interest that
you're paying, which is why you need to make sure that you are a disciplined
spender before you use a credit card, but, you also need to make sure: Two, that you
use your rewards! One third of all credit card users have never redeemed any of
their rewards, ever.

Let me draw you a little picture here. So this circle
that's a little lopsided, represents everybody who has a credit card. Now, just
over half of these people, like we just talked about, are using their credit card
wrong, and are losing because these are the people paying interest.
Well, one-third of all credit card users who are getting rewards, which means they
have to be on this side because these are the people that are paying the
interest, are not using them. That only leaves this people that are using credit
cards right, and to their advantage, and are winning in the credit card game.
Let's put a little smiley face here, this is where you want to be! When I was a kid,
my Mom would always tell me: "Finish your food Jaspreet, there are hungry
people in India." I'm gonna rephrase that to make it a little bit more applicable
here; "Use your rewards people, there are a lot of people in debt that wish they had
them!" Third: make sure your perks don't suck.

You ever see those videos where parents
go to their kids and say: "Guess what, you can have some money.
The only catch is, you have to pick which hand do you want, and one hand has more
money than the other". Well, you get to do the exact same thing with your credit
card, except this time you get to see what's in my hands. Which would you
rather prefer? When I got my first credit card, I knew nothing about credit cards. I
went to my bank, I asked for a credit card and I was it. Hmmm? But not all credit
cards are created equal. Ugh, it's 2020, you can't say that Jaspreet.

Some credit
cards will reward you with more cashback, bigger bonuses, more perks, and better
rewards than other credit cards, for free. I learned this the hard way because my
first credit card gave me next to nothing, which is why I no longer have
that credit card. Now, I look for credit cards that will give me the most cash
back, because when I have cash in my hand I can use it however I want. I
can even use my cash to invest in my credit card company. The only exception I
have to my cash back only rule, is for a travel card—if and only if—you travel at
least a few times a year. I'm not gonna do a full breakdown of every credit card
in this video, but my team already put together a few blog posts with my
favorite cash back credit card, the best credit cards for travel cards, and my
favorite business credit card.

85% of People Are Using Credit Cards WRONG

If you want to see them,
I already linked them in the description below for you to check out. You don't
have to enter in any information to read them, these are just articles on our
website, where we do a full breakdown of the card, the perks, the signup bonuses,
and everything in between. So, if you want to up your credit card
game, and make sure you're getting the best perks, and the most cash back, check out
the articles are linked in the description below. Fourth: you've got too
many credit cards. I don't like the idea of signing up for 25 credit cards this
way I have one credit card for gas, one for restaurants, and one for toilet paper.
I get four percent cashback on toilet paper with my "Visa toilet card".

The more
credit cards you have, the more likely you are to screw something up, which is a
mistake that I don't want to pay for, which is why you have to make sure, five:
that you use a credit card like a debit card. The majority of people think that
their credit card is a magical piece of plastic that just prints out free money.
Mr. Magic Plastic, can I please have a free pair of shoes? Oh, thank you! And
these are the same people who get abused by their credit card. If you want to use
your credit card to your advantage, you need to treat your credit card like a
debit card, instead of treating your credit card like a machine that prints
you free money. Use your credit card to only make the purchases that you would
normally make with cash, and then pay off your entire credit card balance each and
every month without missing a month, this way, you never have to pay a penny in
interest, and to help you with that, six: Make sure your limit isn't too high.

For
some reason that I don't think I'll ever understand, people think it is cool to
show off how high their credit limit is. What's up guys? Take a look, my bank says
that I can borrow fifty thousand dollars of their money, and I only have to pay
them back twenty nine point nine eight percent of my life. If your monthly
expenses are five thousand dollars a month, you don't need a thirty five
thousand dollar monthly credit limit. So, I want you to call up your credit card
company and say: "Hi, I'd like to get my credit limit adjusted".

Oh, you'd
like to raise your credit limit? Sure, I'd be happy to help you with that! Uh, no. I'd
like to lower my limit. Lowering your limit is kind of like wearing a credit
card seatbelt, because now your savings are protected from a spending accident.
And number seven: you don't even know your credit card. Let me ask you a
question: how big was your credit card signup bonus? $200. How much cash
back do you get? One and a half percent. Do you get purchase protection?
I'm not sure. What about fraud protection insurance? Oh, uh blhuuh… Most people can
tell you what their sign up bonus was and how many points they get but after that, it's
just crickets… And your perks disappearing. If you go out and you buy a
new watch, and then you lose it, some credit card companies will pay you for a
new one. Other credit card companies will take the manufacturers warranty on
your laptop or on your phone, and extend it for a year, just because you used your
credit card.

These rewards can be really useful, but they're worthless unless you
know that they actually exist, so I want you to take five minutes and go
research all the rewards, perks, and bonuses that your card has to offer, this
way, you can use your card to the max. Without actually maxing it out… And to help
y'all with this, we already broke all this information down with some of our
favorite cards in the articles in the description below. Thank you for watching,
if you enjoyed this video, share with one friend, and if you don't want to miss
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License: Creative Commons