Cash Back Cards - Get Paid To Spend

Cash back credit cards offer you an annually paid percentage based on how much you have spent on your card. At the end of the year you will be paid by cheque or your card account will be credited by the sum you have accrued throughout the year. While the percentage repaid is only a small amount, if you spend a lot on your credit card and you pay off your balance in full every month then the cash back you receive can be a nice little sum.

Most cash back cards don't take into account balance transfers or cash advances, the cash back deal only applies to purchases you make with your card so don't think you will gain a large cash back sum by transferring a large outstanding balance - you won't!

The Cash Back 'Discount'

The amount of cash back you receive varies from lender to lender so it's worth having a look around for any introductory offers or any special low rates that might be available. Usually the rate is around 2-3% which isn't bad at all if you consider it. In effect you're getting around a 3% discount at every store or location where you use your card for items or services you would be purchasing anyway. If you pay off your balance in full monthly you won't be paying any interest either so you will get the full benefit from using your card.

Keep Up Your Credit Repayments

Before applying for a cash back card there are a couple of things to take into consideration. Most cash back offers mean you have to comply with the terms and conditions of the deal. Missing any payments or making late payments usually means you will forfeit any cash you have accumulated throughout the year so it's imperative you make regular payments. The best way to do avoid this problem is to pay by direct debit, and to pay the balance in full every month if you can.

Limitations

You should also be aware that some cash back cards have an upper limit on spending. When this limit is reached any more money spent on your card will not accumulate any cash back. It's therefore important when choosing a card that you make sure your spending isn't likely to go over the yearly limit, or you choose a card that has no limit.

Some cash back cards are also limited to certain partner companies and you will only receive cash back when you use your card in these stores or when buying a partner company's services or goods, so before deciding on applying for a card take all these factors into consideration and choose the one that suits all your needs.

It's definitely worth looking at how much you spend on your current card and comparing it with a cash back card as you could make considerable savings by applying for one.


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