How to Make the Most of Your Credit Card Spending

Credit cards get a bad rap, but these tiny pieces of plastic can be extremely valuable. From cash back and frequent flier miles to points toward merchandise and gift cards, a wisely used credit card can pay you back in many different ways.

The responsible use of credit cards can help your personal economy, not hurt it. The key is to set spending limits and plan ahead. If you have a workable budget in place and a basic sense of financial intelligence, you can actually get your credit cards to pay you. Here’s how.

Take Advantage of Sign-Up Bonuses

Credit card companies are always looking for new customers, so much so that they are willing to pay for the privilege. It is not uncommon to see credit cards with sign-up bonuses of $100, $200 or even $500, and all you have to do is follow a few simple rules.

The requirements for these bonuses vary, but they typically include spending a set amount of money in a specified period of time. This may seem like a license to overspend, but if you do it the right way you can bank thousands of dollars in bonuses without paying a penny in interest.

Stock Up on Gift Cards

If you want to make the most of your credit card spending and book a few bonuses along the way, stocking up on gift cards is a good way to accomplish both goals. You can buy gift cards for the local grocery store, big-box retailers and even online shops, meeting the requirements for credit card bonus offers and giving yourself a head start on holiday shopping.

If you want to save even more, you can use your new credit card to purchase discounted gift cards. Reseller sites offer significant discounts on gift cards, taking in unwanted gift cards in exchange for cash. But even without the discount, this gift card buying strategy makes a lot of sense, as long as you have the cash flow needed to pay the bill in full.

Play Your Cards Right

Taking advantage of sign-up bonuses is the most obvious way to profit from credit cards, but it is not the only strategy. After all, there are only so many sign-up bonuses available, and eventually, the well will run dry.

When that happens, it is time to make the most of the credit cards you already have. Every credit card company offers a different set of benefits, including cash back offers and special bonuses for certain spending categories.

It can take some work, but researching these competing offers can help you maximize your rewards, so your credit cards can actually pay you back. From 5% cash back on groceries and gas to 4% off at hotels and restaurants, these bonuses can really add up. Bonus offers change all the time, so do your homework and swap out the cards accordingly.

If you think of credit cards as a trap for the unwary, you might want to think again. While it is true that credit card debt can be extremely challenging, using credit cards wisely can actually be good for your personal economy. The tips and strategies listed above can help you make the most of your spending, so you can book those bonuses and cash back offers like never before.

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