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The competition to get your credit card business has heated up
so extensively that banks are literally paying you to take a
credit card from them. Nearly every major issuing bank now
offers a credit card that gives you bonuses for using their
card. Consider the following offers you can find today on
Internet sites where you can apply for a card online.
Cash Back Credit Cards
These cards return money to you in the form of checks. Many of
the cards offer deals like 5% cash back on purchases at grocery
stores, drug stores, and gas stations. In most cases, the stores
are the major chains where you probably shop anyway. On top of
that, these cash back cards usually offer 1% cash back on all
other purchases. Some cards offer even higher cash back
percentages for specific gas stations or for buying specific
grocery or drug store products.
A quick bit of math will prove how valuable this cash back
proposition can be. Let's say you're a family of four with two
cars. You spend $600 a month at grocery stores, $100 at drug
stores, and $200 at gas stations. If you pay for these purchases
using your credit card instead of cash or a paper check, that's
$900 per month on which you get 5% cash back. That comes out to
$45 per month returned to you. Let's say that in addition, you
use your card to make another $500 in other purchases that
qualify for 1% back; that adds another |
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$5 to your coffers, for a
total of $50 per month, or $600 per year back to you. Not too
shabby for just using a credit card.
Rewards Credit Cards
Some credit cards offer you rewards such as bonus points that
count toward gift certificates redeemable at top name stores,
such as Best Buy, Home Depot, and Macy's. Other cards offer you
rewards in the form of Frequent Flyer Miles to use on any
airline.
Let's say you use your card to charge $1000 per month on items
that you normally would pay cash for. Rather than simply
spending your money, now you also get gift certificates to buy
merchandise, or frequent flyer miles to tune of 12,000 per year.
And some of the cards also offer you a bonus the first time you
use the card - so in the case of miles, you can get an extra
15,000 miles, for a grand total of 27,000 miles in one year --
enough for a free ticket to anywhere in the US.
Maximizing Your Card Usage
Of course, the key to taking advantage of such cards begins with
choosing the one that best fits your normal purchasing habits.
Compare online credit card offers and find the offer that makes
sense for your lifestyle. If you have a large family and buy
lots of groceries, maybe the 5% cash back cards are the best. If
you fly often and can benefit from the frequent flier miles,
apply for those cards.
Then be sure you maximize your |
