"The points make it worth it"

Some cards give something back. Points, air miles, a percentage in cash. Using the card for everything earns it, and not using it leaves it on the table.

Run the arithmetic. A cashback card might return a fraction of a per cent of what you spend, or a point or two per pound that converts to something similar. A balance at twenty per cent costs twenty per cent a year on whatever's carried. If you spend a thousand pounds in a month and carry it, you've earned perhaps five pounds in rewards and started paying nearly seventeen a month in interest, and the interest runs for as long as the thousand does. The rewards don't offset the interest. They're a rounding error on it.

The rewards are worth having in one case, which is at zero. A person who puts everything on the card and clears the balance in full every month pays no interest and keeps the points, and for them the card is a slightly better way of spending money they already have. That's the design's picture of the customer, and it's the one this book isn't about. For anyone carrying a balance, the points are a small gift attached to a large charge, and they exist because they make the card feel like it's paying you.

There's a version of this belief that's about the credit score. Using the card and paying something keeps the score healthy, and the score matters for the mortgage. That's true up to a point. It's also true that a high balance relative to the limit tends to count against you, and that a card used and cleared does the score more good than a card run near its limit for a decade. The score isn't a reason to carry a balance. If anything it's a reason not to.

So keep the rewards card, if you have one, for the day you're at zero. Until then, the points are a reason to use the card that the card supplied, and the interest is the price of listening to it.