Find The Ideal Cash Back Card For You!
Before applying for the cash back cards, you should take a look at the pros and cons. I agree that it sounds like a great idea to get cash back when you use your new cards but it isn't the best choice for everyone.
The principle with the cash back credit cards is really quite simple. As a credit card holder, chances are you use your card fairly regularly to make purchases in stores or online.
Credit card providers allow you to benefit from your purchases by giving you a small percentage of the purchase amount as 'cash back'. So essentially the more you spend, the more you will earn. The earnings are then credited back to your outstanding balance!
The cash back rates will obviously vary from card to card, but generally you'll find the rate to be somewhere around 2-4%. So for example, if you spend $1000 you would look to earn around $20 to $40.
That's not very much? Well it's not a huge amount, but you'll be pleasantly surprised at how the small dollars pile up for the end of the month!
The best strategy is to use your cash back credit card in place of your banks debit card for daily spending, then use the money you left untouched in your bank account to clear off the balance at the end of the month.
These cards often have annual fees attached to them. It may not seem like much as you think you will gain more money back than the card will cost you.
Make sure to read the fine print to be sure that's the case. If you don't use credit cards often the cash back may entice you to spend more than you should.
If you don't use a charge card often, the cash bonus may not be enough to make up for an annual fee. Remember, many credit cards have no annul fees at all so check the terms for getting your 2% or 5% rebate and see if it suits the way you shop.
Cash back is such a great advertising slogan. It's so good that many will sign up without a careful check of what they are agreeing to. Some of the highest interest rates, even for those with good credit are on special credit accounts like this cash offer.
If you pay your balance in full every month this may not concern you at all. However, if you are one of those who carry a balance on their account from month to month, you could actually end up paying much more in interest fees than the card is worth.
Is a Cash Back Credit Card Right for You?
If you aren't certain you'll be able to pay you balance off in full every month, then a cash back card is not for you as you'll find that the interest you're being charged will swallow up any cashback you may have earned. Credit card companies are constantly catching people in this trap, don't be one of them!
By using the card for your everyday spending, then clearing the balance with the money you would have normally used, you will avoid accruing interest while still benefiting from the free cashback on your purchases!
Sounds great? It's important to remember that although you're earning cash back on your purchases, your card is still a credit card, and as such you'll be paying interest on any outstanding balance you carry into the following month, so to make the card really work for you it's crucial you clear the balance monthly, that way youll be earning cashback but not accruing any interest. Simply free cash!
it's for you if...
it's not for you if...
My experience with cash back credit cards is that you can actually profit from them once you spend some time learning the terms and use those regulations to your advantage.
Unfortunately, a lot of people are too lazy to do that and they often end up with unpleasant surprises which cost them a lot of money.
So you've carefully thought about it and decided that this type of credit card is the right choice for you? Great!
Now let's find the best cash back card available online for your specific needs. Make sure to read the cons and pros of credit card cash advance and the common pitfalls you must avoid!