Friday, February 22, 2008

Make Money with Credit Cards

Today’s society almost demands that the average consumer have access to a credit card. Credit cards are essential to transact almost every type of business that is done around the world. Credit card use includes but is not limited to, internet transactions, vacation transactions, and is almost always a requirement when the consumer is completing a transaction via telephone. Credit cards also provide some physical safety as they do replace cash and can be “closed” immediately with a simple phone call in the event the card is lost or stolen.

This article is going to discuss making money with credit cards. There are numerous types of credit cards available to consumers today. Many of these cards offer introductory low interest rates, points (for prizes), and may be specialized (airline miles). There are also many credit cards that will offer cash back. This is when the credit card company will return money to you (the consumer) on purchases that you have made using their credit card. While this is a simple concept , in order to realize the full effect of the cash back the credit card balance should be paid in full during each billing period.

Lets look at a cash back credit card as being able to reduce the amount the consumer pays for goods and/or services. Credit card companies offer a wide range of cash back options and the consumer will have to research the companies and make the best possible decision for themselves. When the credit card is used and the consumer makes a purchase the credit card company holds back a previously declared portion of the purchase for return to the consumer. The smart consumer will make certain that the credit card does not accrue any interest charges. This is done by paying the balance in full. The held back cash is then returned to the consumer thereby decreasing the amount the consumer has paid for the goods or service.

The next type of credit card to discuss covers Airline Miles. I am addressing this type separately since this card would be marketed to a certain niche of consumers. This card provides Frequent Flyer Miles for the consumer to purchase and/or upgrade flights. The credit card company will list a ratio of dollars spent equals the number of free miles provided. The Airline will provide a listing detailing the number of miles required to obtain a ticket or an upgrade. This free or reduced price ticket can create substantial savings for the consumer. Please note that the savings can be negated by paying interest or late payment charges.

Last, and certainly not least, is the credit card that provides points that can be exchanged for various “items.” There is an almost endless list of consumer goods available. The items can range from gift cards to toasters. The goods represent a savings to the consumer.

The consumer should research and determine what type of credit card best suits their needs and lifestyle. Cash back, airline miles, and “points” are all excellent benefits for the consumer and an excellent marketing technique for the credit card company. The consumer of today should take full advantage of every possible opportunity, and this includes Making Money with Credit Cards.

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