Getting The Most Out Of Credit Card Freebies

by John_S on February 12, 2011

It is hard to cheat a credit card company – most of their “freebies” come at a price far exceeding their worth. But if you play your cards right, the benefits incurred from freebies go above and beyond free flights, CDs, and vouchers.

The first thing to do is simply sign up for the card. Charge something small to it, get the “free gift” for new clients, then pay off your debt, and cancel the card. If you persist at this, you will be getting paid just to spend. The downside is that this will result in a seriously poor credit rating.

Not sustainable enough? Make sure you choose the right credit card. What you do is pay the card off in full through direct debit each month, so you won’t be charged interest, and make money just for using the card. You can make thousands of dollars this way.

Take advantage of 0 percent introductory offers and then put the cash in a savings account that brings high interest.

What are the top freebies? Many great offers come through e-mail; so, do not hurry to mark every credit card offer in your inbox as spam. Some credit card companies offer bonus points that are converted into gift cards, which you can use at a variety of bookstores, music stores, and more. For example, American Express offers points per month, and you can use the gift cards at M&S, Amazon, Waterstones, iTunes, Comet, and others.

Make sure you cancel the card once you are done using it. Otherwise, they charge dormancy fees. Once you have taken advantage of the promotion, simply cancel the card, and do not feel bad about doing so. 

Cashback cards may be a good option, but make sure you can pay off the card in full each month. If you can’t, go for something with a lower interest rate. If you have existing debt, cashback is a bad idea. Direct debit is the best way to pay off in full because it enables the issuer to take a variable amount every time that corresponds to your debt. Make sure your issuer offers this option – sometimes they don’t because they make less money that way. The best cashback card in Canada is the MBNA Smart Cash Credit Card. It is free to sign up, and you get 3 percent cash back on groceries and gas and 1 percent back on everything else. What is more, a host of insurance coverage is offered. Other good choices include the ICICI card and the Virgin card, both by MBNA. 

American Express is in partnership with BA, and free points can go toward free flights. Spending several hundred on the card each month earns you thousands’ worth of flights. However, this excludes taxes. Always book tickets online because there is an extra charge if you book over the phone. Another option includes budget flights. Citibank offers credit for certain amounts spent within the first three months on the card. The bank is in partnership with Easyjet, and this credit can go toward flights, car rental, and hotels. Again, taxes are excluded.

Get joint cards if you have a partner you can trust. All of your expenses will be earning points. Charge absolutely everything to the card. If you want to make sure the card will be accepted anywhere and everywhere, you should go for Visa or MasterCard, not Amex. Do not forget that if you already have a card, you may have trouble applying for another one from the same establishment.

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