This is a guest post written by Money Supermarket, a UK based comparison site.
Recently, the Bank of America announced that they, like many other financial companies, were introducing a cashback credit card. These types of cards are becoming more and more popular as credit card companies try to encourage consumers to spend.
And the popularity of these cashback credit cards is soaring as people take advantage of the benefits on offer.
However, there are more benefits than people originally realize. With a little bit of strategic thinking, it is possible to get free money from your credit card company. Of course, this sounds wonderful to most people but there are some initial considerations.
Firstly, these strategies work best for individuals who can make their repayments within the set amount of time. If you are struggling with debt, attend to that before trying these methods.
Secondly, it takes some effort to keep on top of dates and deadlines. If your life is hectic and you are not the organized type, these strategies could prove costly.
If you are happy with those conditions though, here are the ways you can, in effect, get free money from cashback credit cards and who would say no to that?
Firstly, apply for cashback credit cards that have a 0% APR, which is the interest rate you pay for borrowing money from the credit card company. APR stands for Annual Percentage Rate.
Note how long this free introductory period is, so that you will never be caught out if it switched to a higher APR. In your organizer, mark around four weeks before deadline dates so you will be reminded in time.
If you have a large purchase to make, such as a vacation or car, use the card to pay at least part, if not all, the amount. Then pay off the debt straight away and collect the cashback.
Some cards will give you cashback only on certain items, such as groceries or leisure activities. You can apply for cards for each specific circumstance to maximize your cashback.
If you do all your shopping at a particular store, see if the retailer offers a cashback card. Use the card rather than paying in cash and make the repayments in full each month to earn more free money.
If you need to return goods, ask the retailer to give you a credit note or exchange rather than refund your card so that you can keep the cashback.
If you have a good credit score, you are an attractive potential client and some companies will offer a cash bonus for signing up to their card. Take the cash bonus and use the card or close the account.
Always remember that companies wish to attract and then keep your loyalty, so competitive deals are available if you do your research.
Often, companies will extend 0% deals to keep your custom, so do ask about this before switching to another card. There are numerous cards out there so take advantage and use them wisely.
4 Comments
We use a rewards card right now in a similar fashion. We get points instead of cash back. In the last three years we have used our points for 7 free flights. It has really come in handy for reducing travel costs.
@Miss T – That’s a lot of points! Starting next week, I have to change my strategy since my debit card will no longer be earning me points. I’m not sure which card to use yet. I guess I have to do my homework this week!
Our main card is a reward card that will send us a check after we get certain number of points. I’d much rather get cash than other form of reward.
@Retire by 40- I like the idea of getting cash back. My cards earn points that I can apply towards gift cards and we take advantage of that option. But cash back would be nice. 😉