If you’re tired of credit card companies making money off you (interest, finance fees, annual fees… etc), why not use your credit cards to make you some money instead? Sound impossible? Here’s what you can do:
- Find a credit card offering 0% interest on cash advances for 12 months OR;
- Find a credit card with 0% interest on new purchases for 12 months, and then use your Paypal account to process a credit card payment like a purchase (essentially, you are charging the credit card and the money ends up being placed in your Paypal account as cash, but without a cash advance fee)
With this 0% interest money, make a deposit into a high interest savings account or a 6 to 12 month CD (FDIC insured) , like one of the following:
- ING Direct
- Capital One Direct Banking
- E*Trade
Deposit as much as you can take from your 0% interest credit card and let it earn interest for the full 12 months in the high interest savings or Certificate of Deposit. During the year, make the minimum payment required on your credit card (you aren’t paying interest, so this is ok!) and before your 12 month promotional interest free offer ends, withdraw money from where you deposited it to pay back the remaining balance. The money that remains is what you’ve earned from the credit card.
Deposit $10,000 in a 5% interest account for 12 months, and you’ll make about $500 off the interest. Re-invest the $500 into a new Certificate of Deposit, or keep it the high interest savings account to grow more; and you can look for a new 0% interest offer and start all over - only this time you’ll have the extra money you earned from the last time to include with your deposit!
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