Tips to earn money from your credit card

How to earn money with credit card….good question, isn’t it?

Actually I used my credit card without any control for last three four years. I spent lot of money and waste some money by using credit cards, anyway finally I stop waste my money and started to use it wisely. So, I know now you are so curious to know how to earn money with credit cards. This is a very simple trick which I started to apply few months back. I guarantee 100%, it worked perfectly. That trick definitely helps you to earn some money. Okay, I will explain how you can earn some money from credit card.

First I assume that you know 0% instalment plans which almost all credit card companies offer to their customers with corporation with some retailers. Anyway it is a plan which you can pay total amount for what you buy in 6 or 12 instalments instead of paying it at once.

Back to the subject, so if you want to earn money you should have total amount in cash or your account which is equal to the cost of the product which you plan to buy. Early days if I want to buy some major item to my house I used to pay total in cash at once. Now I changed my strategy, if I want to buy a major item such as LCD TV, laptop, Refrigerator, Furniture or my car insurance, I never pay it at once. I always go for 0% instalment plan. But as I told you earlier, I always keep enough money for entire product in my hand when I go for 0% instalment plan.

Now the interesting part, while I go for the 0% instalment plan I deposit money in my bank account. At the same time, keep in mind to make necessary arrangement to pay your credit card instalment by your saving account. (If not you will lose money instead of making money since you may forget to pay your instalment. Credit card companies always need you to forget your instalment then they can earn more money by interest and late payment fee).

These days interest rate in my country is around 7%. Last time when I buy a LCD TV, I have to spend around 1200 USD. Early days I just pay total amount, but this time I save the money in the bank and went for 0% instalment plan with 12 instalments, then I had to pay 100 USD in each month. Again keep in mind to set automatic settlement of your credit card by your saving account if you try my trick.

Now the calculation,

• Interest for 1^st month, 1200 * 7/12/100 = 7 USD
• Start of the next month the balance will be 1107 (1200+7(interest)-100(instalment)).
• 2^nd month -- 1107 * 7/12/100 = 6.45 USD
• 3^rd month – 1013.45 * 7/12/100 = 5.92 USD
• 12^th month – 146.63 * 7/12/100 = 0.86 USD. Now finally there is balance of 47.49 USD in your bank after you pay the final instalment.

See you earned 47.49 USD. But I know interest rates in many countries are around 1%~2%. Even you can earn around 10 ~ 15 USD. So when you use this plan for all the major items which you buy, then your earning will automatically increases. Some may say this is a savings, but for me this is a earning.  

Again this plan works only if you have enough money to buy the product in your hand. I know many people just pay total amount as cash instead of go for 0% instalment plan. So my advice is when you have enough money to buy major product just save it in your bank and go for 0% instalment plan as I do. It works, you can earn money.