Getting Cash Back with your Credit Cards

Traditional credit cards, even low interest credit cards, offer rewards like air miles, dining vouchers and even gifts like LCD TV. The types of rewards that credit card issuing banks offers are mind boggling, but more recent, cash rebates are becoming very popular. This is because most people prefers to recieve cash over the usual rewards, which may not always be what they desire.

For a lot of people, the idea of recieving cash is way better than air miles or even LCD TV. Think about it, cash offers you the flexibility of buying anything you desire and not be limited to only what the banks offers. This can also be thought of as another form of discount of the credit card's interest rates.

Higher Fees and APR


Normally, these types of credit cards entail higher fees and APR. You don’t want to carry a high balance on these cards at any time, as it normally ends up very costly. If you can off your balance at the end of the month, then your APR won’t affect you. Paying off your bill will also allow you to take full advantage of the cash rebate reward.

The percentage of cash back will vary, although most normally have 1%, with 5% being applied with certain purchases. For every purchase you make using your cash rebate credit card, you’ll get a small amount of cash back. Using your credit card on a frequent basis will give you a lot of cash back at the end of the year.

Getting Cash Back for Large Purchases

When you make large purchase, you will likely be getting a sizable cash back on your credit card. However you should check your terms and conditions before you use that card. This is because many such cards have a limit on the monthly cash rebates and you may be better off with using a high rewards, low interest credit card. But if your card is one that offers cash rebates without limit, it will definitely help in lowering the price of that large diamond you are dreaming off.

Interest Rates versus Cash Rebates

Remember. The better the cash rebates, the higher the interest rates or APR will be. Interest rates is where the banks make their money. If you make large purchases thinking that the cash rebates will help to offset the interest rates, you would be in for a rude surprise. Never use a cash rebate credit card to help with your cash flow problems, the high interest rates can compound fast.

Always research the rebate credit cards and find out what are the other features and terms. There are many credit cards that actually offers a competitive APR, due to the competition between banks. You should compare all such cards and then decide which is the one for you. If you are the discipline sort who pays your monthly balances on time, a higher cash rebates (even if it comes with a higer interest rates) can be right for you. Just make sure you pay on time.

Jared L