I write this after careful study, always repeating the caveat "if anything seems to be too good to be true, it probably isn't."
The big discovery of this year 2000 gold mine came when I was trying to figure out how to pay $7500 for my daughter's summer session tuition at NYU. I had two choices: take a onetime distribution from my IRA (I'm over 59 1/2) or write a check on my bank home equity line of credit at 9% interest. A retirement fund withdrawal would raise our income bracket and require payment of more tax. Using the line of credit would give us a federal tax deduction and reduce our income (likely providing a bonus by making the family eligible for two $1000 Hope tax credits).
But lo and behold, a handful of banks mailed out offers that seemed too good to turn down. By signing up for one card, I can use it to pay the tuition with the bank's money that they are advancing to me at 0% interest for six months. (You read it right: 0% interest.) Only small monthly minimum payments of a few hundred dollars are required until the Yuletide bells ring.
How sweet it is!
My money keeps earning 6% and change in the IRA. By December I will have pocketed $200-$300.
You may ask, why am I so cheerful? Don't I realize the hefty fall tuition bill is already in the mail, payable in mid-August? Sure, but those softhearted moneybags in their custom-made suits (if it isn't dress-down Friday in the vaults) are watching out for me.
I received in today's mail a second credit card application from another bank, likewise offering 0% for six months extending from August through Feb. 1. This will enable me to make a few more bucks instead of shelling out my own money in the Dog Days.
Will there by a reckoning next year? Perhaps, perhaps not. Who can say that the fierce credit card wars will end? An optimist can even look forward to a better deal. Wouldn't a balance transfer at 1.9% to 5.9%, now offered by many bank cards, really add green to my spring?
But if the good times of the bull market end, damaging the wave of spending by confident consumers that has meant huge profits for credit card issuers, there's no need to panic. It's back to Plan B: tap the IRA or line of credit.
Meanwhile I just might buy that car or home entertainment system or take the dream vacation financed with the help of those credit card rebates. Is this a great financial country or what?