1- Select a card with cash rewards or a good point system that suits your needs
Checkout your spending habits
The very first thing to do before looking for good cash reward credit cards is too look at your spending habits. Why? Because there are credit cards that will give your more points or cash rewards on gas (like the Discover Open Road Card for example) while others will give you a flat cash reward percentage (the Discover More Card offers up to 5% cash rewards in popular categories such as restaurant and gas).
By determining where you spend the most, you will be able to identify the type of purchase that will give you the most cash or reward points at the end of the year.
Checkout your needs
Several people want to use their points or cash reward for a specific goal. We often hear people say that they bought their plane tickets with their points. Actually, travelling seems to be the big trend when it comes down to cash your credit card reward points. It’s a cheap an easy way to finance a part of your vacation.
If you prefer to get travelling rebates, I suggest the Platinum Delta SkyMiles® Credit Card from American Express. This one is giving you 1 mile by dollar spent along with 20,000 bonus miles with your first purchase! You can exchange your points everywhere and fly to your dream destination in peace… and for free!
You may find a great credit card offering a great reward program but if the program doesn’t fit your needs, there are no point getting this so called generous credit card. You have to find the reward program that fits your needs.
Start hunting!
We have the bad habit of getting the very first credit card we see or the one that is offered by our bank as our main credit card. You know that both debit and credit cards have their own advantages? Well a credit card is way much more than simple piece of plastic granting you the privilege of paying goods later in time. This should actually be used as a transactional tool that makes your purchase free of charges along with giving you cash rewards or points.
Therefore, a little research should be implicated in the choice of a great cash reward credit cards. Forget about the interest rate, the 0 APR transfer promotion; focus on the goodies. The plan with this credit card is not to finance purchases; it is to build rewards and benefit from it.
Here are a few examples of great cash reward and points credit cards:
Here is the complete 6 Easy Steps to Make Money From Cash Reward Credit Cards of Point Rewards Credit Cards (links will be updated as article goes live).
1- Select a card with cash rewards or a good point system that suits your needs
2- Use your credit card for your day-to-day spending
3- Keep another credit card for emergency
4- Do not withdraw money from your bank account anymore
5- Pay it completely at the end of the month
6- Enjoy rewards from your credit card
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You will probably wonder what I have against Dave Ramsey to write two full post against this personal finance guru. Well I think over the years, Dave Ramsey got some fog into his glasses and don’t see quite clear anymore. I sometimes have the feeling that since it is part of his sales pitch, Ramsey go against banks and financial advisor a little bit too much these days. It’s not because a bank is offering a debt management solution that it is automatically wrong.
While I explain while I disagree with Dave Ramsey in regards to not paying your highest interest debt first. I found another point of debt management where I have to disagree.
On Ramsey’s website, he is saying that consolidating debt is not a solution to them off. He actually says that it only reports the problem later in time.
I have personally seen people getting squeezed by their debt and asking to remortgage their property in order to pay them off. What happened after has been described by Dave Ramsey: they continued the same way of living and get into more debts instead of using their free cash flow to pay them off… disappointing isn’t?
This is exactly Dave Ramsey’s point; if people are not serious about paying off their debts and managing their credit, there is no point of consolidating their debts!
But when you think about it, if you are not serious about taking care of your personal finance and manage your debts like a big boy, consolidation loan or not, you will end-up losing everything anyway. The only difference is that you would lose everything sooner without the consolidation loan 
On the other side, if you are serious about paying off your debts and taking back your life, consolidating your debts will bring several advantages such as:
- Fixed monthly payment (compared to small payment required on credit cards).
- A known amortization (you will know exactly when your debts will be completely paid off.
- Usually smaller payments (because you will amortize it over a longer amortization period).
- Smaller interest rate (compared to regular credit cards for example).
Therefore, if you consolidate our debts and you cancel your credit cards, you will become in a much better financial position. In the end, it is a matter of getting serious about debt or not. However, there is nothing stopping you paying less interest on your existing debts once you have made that choice
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Every Saturday, The Credit Toolbox does a review of good read around the blogosphere. Here’s what caught my attention this week:
No Credit Needed shows you how to break the credit card habit.
Consumerism Commentary debates paying off debt or funding an emergency fund?
Dough Roller says refinance your mortgage now!
Bargaineering has the best student credit cards.
Money Under 30 asks if joint credit cards are a good idea?
Bad Credit Advisor asks if you should pay your mortgage off early.
Personal Finance Startup explains the effect of credit scores on mortgage rates.
Discover Debt Freedom has some sources for consumer loans.
Ask Mr. Credit Card has some ideas about raising your credit score.
Carnivals:
Carnival of Personal Finance
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Whoa, this is a huge statement in this Monday morning! What am I thinking; attacking of the most popular personal finance guru; Dave Ramsey? Who am I to critic his way to pay off debts? Well, I’m simply a guy that don’t think the same way
While surfing Dave Ramsey website and listening to his Ramsey Radio Show, I found the “myths of personal finance” (this is at the bottom of his website). This is where Dave Ramsey provides a group of myths about personal finance and how things should be done according to the “Ramsey way of paying off debts and managing personal finance”.
While I agree with most of his advices, I got somewhat confused about the following myth and his answers about it:
Myth: “You should pay high interest debt first”
Dave Ramsey’s answer: “You should pay the smallest debt first in order to create a momentum”.
Then, he mentioned that, according to his own experience, most people can’t pay off their debts because they don’t have the right mindset and not because they don’t have enough cash flow.
I somewhat agree with this statement as you really need to get out of debts before you can actually pay a dime on your credit card efficiently. The very first thing to do in this situation is to write down a plan of action and keep track of it.
Where I disagree with Dave Ramsey is that you can build momentum by looking at how much interest you save every month by focusing on the highest interest rate debt! If you have a credit card of $10,000 at 15%, you are better off paying is and forget about your $1,000 small credit card at 8%. If you see the 10K debt as a huge mountain you can’t climb, Dave Ramsey suggests that you forget about the mountain and that you start with the small hill (1K debt).
I think you are better off calculating how much you would pay in interest over your 10K debts if you take a year to pay off your small debt. You would probably save roughly $100 of interest every year by paying down your 10K debt. That’s probably an extra monthly payment for free! I don’t know about you, but that motivates me to pay off my highest interest debt first… sorry Mr. Ramsey
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