How To Make The Most Of Your Cash Back Credit Cards

By now most people know what a cash back credit card is and how they work. It is pretty simple really, credit card companies in order to get your business, offer to give you money back for using their card to purchase things.

While this sounds good, keep in mind that the credit card company is hoping that you will be so excited about the possibility of getting money back that you will charge up these cards and have to carry the balance over past the interest free period.

Since the interest on these cards is usually quite high, the credit card company will make a handsome profit far higher than the money they give back to you. However, there is a smart way for you, rather than the credit card company to reap the rewards of those cash back credit cards. Here is how you can actually save money by using these cards.

Look For The Best Cash Back Cards

When looking for a cash back credit card look for the ones that actually give you the highest percentage of cash back. Most cards offer a 1% cash back incentive but, there are many cards that offer higher percentages for expenditures such as gasoline and groceries.

Identify How You Use Your Cards

The main thing you want to remember is that you don’t want to use these cash back credit cards for every expenditure. You only want to use these cards for those expenditures which you normally pay every month such as electricity, gas, groceries, etc.

As each bill comes due put the money for the bill in the bank and use the credit card to make payment. When the credit card comes due use the money you normally would have paid for these bills to pay off the credit card in full. That way you won’t have to pay interest and you will get money back as well saving you money rather than making money for the credit card company.

For all other expenditures that will require you to carry over a balance use those low interest cards. While you won’t get any cash back you will save money in the long run by paying those lower interest rates.

Using those cash back credit cards wisely will put money into your pocket rather than profiting the credit card company.

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