3 Ways To Make Real Money With Your Credit Card

3 Ways To Make Real Money With Your Credit Card

For years, when I was deep in debt, my credit cards ruled me. The balances that I carried on them never seemed to decrease and were a constant strain on my life. The money that I was wasting on interest fees was outrageous! For the longest time, simply carrying these things around in my wallet was costing me money.

And unfortunately, that is how most Americans live today – carrying monthly credit card debt with no end in sight.

The solution is that we need to make getting out of credit card debt one of our top priorities. I know this is easier said than done, but there are lots of simple and easy ways to make significant progress with credit card debt reduction.

Then, instead of your credit cards costing you money each month, you can actually use them to generate real, usable, spendable cash in your everyday life. This was something that I never even knew was possible before I got out of debt. Once I learned it, I took full advantage of it in every way that I could.

The following are 4 tips and strategies for how to generate this real cash. Of course, most of these are not feasible unless you are out of debt with your credit card and can pay off your balance in full each and every month.

1. 0% Balance Transfer
There are many ways to take advantage of 0% APR balance transfer credit card offers, but one popular strategy recently gaining steam is known as 0% balance transfer arbitrage. Here is a step-by-step process of how the strategy works:

    Find a credit card offer with a 0% APR, 0% balance transfer fee option (the most difficult step).
    Apply and open a credit with as high a credit limit as you can get.
    Take out the full balance allowed under the 0% APR offer.
    Invest this money in a liquid, ultra-conservative financial instrument that offers a reasonable interest rate (I personally use a high-interest savings account that gets me 4%). You can also explore peer-to-peer lending networks like Lending Club to invest the money with significant returns.
    Do not use the card for anything else other than this balance transfer.
    Pay off the balance in full before the the 0% APR period ends by taking out the necessary money from the financial instrument you chose. This period is usually a 12-month introductory period. This is the most important step! If you cannot pay your balance off in full, you will be hit with hefty interest rates once the introductory period has expired.

By following these steps, you will have created 4%+ in “free money” simply by taking advantage of the 0% APR credit card offer. Balance transfer arbitrage is by far where I generate the most cash from my credit cards. You have to be organized and stay on top of things, but it’s literally like taking candy from a baby.

With that said, this strategy is not for everyone. You need to be disciplined and 100% confident that you will be able to pay off the balance in full before the 0% APR period ends. If you have any hesitance that you will be able to follow through with the process, then don’t try it. Instead, take advantage of some of these other great strategies.

2. Set Up Monthly Bills on Your Credit Card
Setting up automatic payments for your bills takes some time and effort. It also takes a lot of follow up and attention to detail because it is easy to lose sight of these bills once the automatic payments are set up. Pick out the credit card with the best rewards percentage and put all of your monthly bills on this card. Then, watch your rewards account skyrocket for doing something you would have had to do anyways: pay your bills. But again, even once you have set up automatic payments, you still need to keep track of things to make sure you are remaining within your monthly budget.

3. Take Advantage of Credit Card Rewards
One aspect of credit cards that many people overlook is the awesome rewards that many of them offer. And you don’t need an amazing credit score to quality for many of them. For example, the following are my favorite 3 cards for cash back rewards and savings on everyday items: Citi Forward Credit Card, Discover More Credit Card and the Chase Freedom Credit Card. And if you don’t qualify for some of the best offers out there, there is still hope; there are ways to improve your credit score rating.

4. Only Redeem Your Rewards Points for Cash
This has always mystified me. You’ve got a card that gives you a great rewards percentage, you do your best to grow your rewards account, and then you use it for something other than cash. OK, using your rewards for free flights I can understand, but how about some good ol’ American cash instead! Who needs an inflatable pool for the backyard which will break in a few months anyways? And do you really need a Homedics Foot Massager? And that DXG Handheld Camcorder that looks so cool in the picture will probably turn out to be a piece of junk. And the best part is you can always use the cash from these rewards to purchase any of these items, often at a much better deal than you would have received had you gone directly through the credit card company.

Build up that account balance and take it in a check, or apply it to the balance of your card. I currently have about $750 waiting for me on one of my cards – as soon as it gets to $1,000, I’m going to cash it in. Imagine that – especially right around Christmas time!

Final Word
Instead of having your credit cards cost you money, why not turn the tables and get them to generate real usable cash in your everyday life?

Do you have any other great strategies for generating money with your credit cards? As always, your questions and comments are greatly appreciated!

刚开始接触balance transfer 时觉得很不可思议。
因为可以不用给利息的借钱。。。
我把钱都放进房贷来减少利息和一些周转
“太死守规矩” 自然就会被 “规则” 局限所拥有的思维。

～ The best way to protect yourself is to be as fluid and formless as water; never bet on stability or lasting order.  Everything changes. ～