Use your credit card to make money not to lose it!

With credit cards growing increasingly popular amongst consumers in the UK, and a wider range of cards than even now available on the market, financial experts are advising consumers to be mindful of the way that they use their credit cards in order to get value for money from them rather than losing money on them. Used in the right way, many of the credit cards on the market today could enable consumers to enjoy money saving benefits.

With cards that offer rewards such as cash back, rewards points, or air miles, it is important that the consumer uses the card regularly in order to clock up as much of the rewards as possible. However, it is equally important for the consumer to ensure that the balance on the card is repaid in full at the end of each month, otherwise the interest charged on the balance could far outweigh the benefits of any reward received for spending on the card.

For those that cannot repay the balance in full on their credit cards each month a rewards based card is likely to be of little benefit, as you would make bigger savings by opting for an interest free card that enabled you to spread your repayments without charging interest than you would using a rewards based card that offers points or cash back but then charges high rates of interest on the outstanding balance on your account.

Consumers can also save money by transferring any existing credit card balance on which they are being charged interest onto a 0% balance transfer card, which will give them time to repay the balance on the credit card without having to pay interest for the specified period. Once the balance has been cleared they can then hunt around for another more suitable card.

Alisdair Milton
20th December 2006

More Information:

• Make Money Using Credit Cards
  It may seem odd that a financial product designed to offer credit can actually make users money in the process, but it’s perfectly possible. Here is our definitive guide on how to earn extra money while using credit cards.
• Quick Balance Transfer Guide
  Balance transfers allow card holders to transfer the money they owe to their existing credit card to another, usually at a special rate of interest. The new credit card company pays off the old credit card debt and transfers it to the new card. This article will tell you how to play the game.
• Successful Stoozing: A Guide
  The introduction of 0% balance transfer deals brought a new financial practice which allowed people to use those deals to make money. The practice is known as 'stoozing' and it is closely related to credit card jumping. The difference is that successful stoozers have to be debt free, otherwise any gains made by stoozing will be lost in paying interest on credit cards.
• Credit Card Benefits
  A credit card can be a highly effective and flexible financial tool for the smart shopper – and saver. It has many obvious advantages over cash and cheques – and a few hidden ones too!
• Rate Tart - Are You One?
  Rate tarts are the smart shoppers of the credit card world. They play the system to avoid paying interest on purchases, borrow money for free, and even make money on that borrowed money!
• Cash Back Credit Card - General Guide
  It seems almost too good to be true; a credit card company giving back money to the user just for spending it in the first place! However, as with all good deals, there are terms and conditions.
• Cash Back or Rewards
  In the battle for new customers, credit card companies are offering to reward users for simply spending on their cards. The two most attractive systems seem to be cash back and rewards.
  

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