Smart Banking - make your accounts pay you

                Whether or not you like it, it is very important that you have credit and debit cards and bank accounts.  More times than not, you will actually need several of these.  There are plenty of solicitations out there, but you need to look for a good deal when it comes to things like this.  Properly applied, you can have your accounts pay you rather than the other way around.  Here are a few general tips.

 

 

  • Don’t cancel credit cards usually – this will often lower your credit score.  However, you can use the cancellation process to your advantage.  If you call your card’s customer service and threaten to cancel, they will often offer you incentives.  One example: I called American Express to tell them I was cancelling one of their business cards.  They gave me a $25 American Express gift card for staying on.

  • Annual Fees suck – don’t sign up with cards with annual fees.  Ever.  They aren’t ever worth any extra benefits you might receive.  Sometimes card companies will offer large incentives for signing up with a card with an annual fee, often which is waived for the first year.  You can take advantage of this offer, but you will have to cancel your card within a year to avoid the charge, possibly hurting your credit score.

  • Sign up for Credit Cards with incentives – unless you have bad / no credit, there will be plenty of cards for you to choose from that offer both rewards (either cash back or points with each purchase) or initial incentives (you get something for just being approved and activating the card).  Many of these may be huge: I once was approved for the American Express Business Gold Rewards card, which came with 25,000 free points after the first purchase.  That was enough points to finance a free round-trip ticket to Chicago.  I also got $100 for this by signing up through a GPT site.  Watch out that the cards don’t have annual fees, however.


 The American Express Business Gold Rewards Card - by signing up for this through an affiliate site, I was give $110 cash, a free round-trip airline ticket to anywhere in the U.S., and the annual fee waived for a year.

  • Do you want something you aren’t getting?  Ask. – you can get benefits from credit card companies by simply asking them for what you want.  Interest rates, payment dates, and other variables can all be changed through negotiations.  Just ask them.  Once every while, I ask all of my credit card companies to lower my interest rates, and they almost always do.  You can also coordinate your due dates so they are all on the same day, something that may be very convenient.

  • Make debit cards work for you – until recently, debit cards have been relatively mundane in that they didn’t offer any extras outside of the direct link to your bank account.  Now many debit cards offer rewards, such as points usually.  Ask your bank if they have this type of debit card you can switch too.  Banks such as Chase and Capital One definitely now do.  I generally recommend someone not using their debit card for most purchases as they don’t offer the same type of fraud protections that credit cards are legally required to provide.


 The PayPal debit card gives you 1% cashback on every purchase, credited immediately.

  • Get free bank accounts – for most people it isn’t advisable to sign up for a checking account where you need to pay some sort of fee.  The extra 1% interest usually isn’t worth it, especially since there isn’t any real need to keep tens of thousands of dollars in a cash account.  Get the free account.

 

 

 

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