A cashback credit card is a great idea, and there are many ways to make money with one of these handy little tools. I’ve been through this at length on a previous post about cashback credit cards, but today i’d like to focus on what you shouldn’t try to do with one of these…
There is one important rule about earning money on a cashback credit card, and that is you just need to spend money on it! There it’s quite simple really isn’t it? The more you spend, the more cashback you will earn. However, there are a couple of dreadful errors you can make with a cash back credit card and they are really quite serious and can take away and good intentions you had of making a few quid.
To begin with you should never get a cash back credit card and transfer you balance from another card. This is wrong for two reasons. If you think you will earn cashback from this transfer you’re wrong, you won’t simply because you haven’t spent any credit from your card. The second reason it’s a bad idea is that the only real way a cash back credit card works is when you pay off your balance at the end of each month, thus avoiding the interest. Well eventually your balance transfer is going to cause a lot of interest isn’t it?
The second thing you shouldn’t be tricked into thinking is that withdrawing cash will earn you cashback – it won’t – so don’t even think about it. Again, the same principal applies here as it does with the transfer, you haven’t actually spent any money on the card, you’ve just withdrawn it; you’re going to spend it yes, but it isn’t on your cash back credit card!