Monday, April 23, 2007

Use Your Cash Back Credit Card to Make Money

Use Your Cash Back Credit Card to Make Money

This is a very simple method. It does require very strict personal fiscal responsibility. Use your credit card with cash back option and charge everything you can. Charge your gas, groceries, and other daily expenses. Be careful to not charge more than what your usual expenses are. Everything you had paid for before with cash you will now charge. You will pay for these expenses in about 1 month when your credit card bill comes.

When you receive your credit card bill pay it in full before your grace period expires. Recommend returning payment as soon as you receive it to avoid any chances of missing due date, thus exposing your balance to interest and possible late fees. Don’t be overwhelmed if your bill is $500 - $600 dollars or more. If you paid cash last month when you made the purchases, you would have spent this much anyway.

On top of the 1 – 2 % cash back you get from your purchases, you will also collect a months interest by having your money in the bank.

Credit Card companies offer these cash back programs because they know the majority of card holders do not pay their balances each month. They will give you 2% back, but your paying around 20% interest. Read your card issuers rules and policies and ensure your payments are always sent well in advance of the due date. Remember you are doing nothing wrong by paying balance in full within grace period before any interest or late fees can be applied. You are only using the credit card companies own rules to work in your favor.

Do Not Try this unless you have tight control of your finances. Not paying entire balance for one month will have the interest and/or late fees negate your cash back amount. Exactly what the credit card companies want, so they make money. Play within the rules and you make money.

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