How nice would it be to actually get paid to spend money? Well, the only requirement for this money-making opportunity is that a person be 18 and over. As long as this condition is met, they can create a small yet profitable income stream through the wonder of cash back credit cards.
What does it mean when you have a cash back credit card? Basically, with a cash back credit card, you get a percentage of the money spent on your purchases. The typical percentage offered from cash back credit cards ranges from 1% to 5%. Most will be on the lower end, but there are more specialized cash back credit cards that will offer the 5%. One example is a cash back credit card that offers rewards for gas station purchases.
So, what's the best way to use a cash back credit card? Well, keep in mind that unless the cash back credit card is offering a 0% introductory APR, you are still responsible for the balance owed, even if you receive cash back on it. For this reason you will want to pay your balance immediately or choose a credit card offer that provides a 0% APR for 6 months to 1 year. Keep in mind, however, that if you use the card for a smaller purchase, you may not receive as much cash back, since you are spending a lesser amount of money. For example, even if a cash back credit card offers 5% cash back, a $20 purchase would yield only $1.00. This is not much of a quick profit, but over time, the cash back adds up.
For instance, if you use a cash back credit card to purchase $1,000 worth of gas and groceries over the course of a month or so, you would receive $50, assuming the cash back credit card offer is set to 5%. If it's 1% your cash back is only $10, but that's still $10 more than if you paid for the rent or mortgage out of your own bank account. Additionally, since groceries and gas are things you would have to pay for anyway, its just as easy as paying cash.
When you get your cash back, consider putting it in a savings account rather than spending it for lunch or other things that don't cost much. Doing this will allow your money to grow over time. You can increase the money-making potential of cash back credit cards if you get more than one; just remember to always pay your balance or apply for a credit card that offers cash back and a 0% APR for 1 year.
