What if I told you that you can make money with your credit card? Sure, credit cards can be a weapon of financial destruction if you don’t know how to use them properly. But if you’ve ever paid interest on your credit card balance, you’re doing it all wrong. Did you know you can invest your cash back rewards? That’s right! I’m going to tell you 10 outrageous ways you can use your credit card to make money.
Pay off your credit card balance every month
If you’re going to be a true credit card hack master, you need to stop paying interest immediately. You’re not going to make any money if you carry a balance month-to-month. Your financial gains will get wiped out by the interest charges.
Let’s debunk a credit card myth once and for all: you do not need to carry a balance to build your credit score. Start paying your balance off every month within the grace period. Every credit card offers an interest-free grace period, typically 21 days or so. Read the fine print on your credit card agreement and pay your purchases off in full within their defined interest-free period.
Track your credit card spending
The only way to pay off your credit card balance every month is to budget, budget, budget. Tracking your spending is critical if you’re going to reap any rewards. You also don’t want to hurl yourself into debt. The rules of this game are simple and finite: make a budget, live within your means, track your spending.
Use the Hardbacon budgeting app to track every dollar you spend and where. You can even link your credit cards to the app so you can keep track of your purchases and your balance owing. Everything is organized and easily accessible in the palm of your hand. Don’t overcomplicate things. Make credit card hacking fun by streamlining your personal finances before you get started.
Take advantage of balance transfer offers
If you’re already carrying credit card debt and can’t pay it off in full next month, you need to take care of that balance if these tricks are going to work. Fear not, we have a hack for that too. A dollar of interest paid is a dollar too much. Transfer your balance and start saving money immediately. There are plenty of credit cards out there that offer low or no interest charges on balance transfers as part of their sign up bonus
Right now, the Scotiabank Value Visa Card offers an introductory 0.99% interest rate on balance transfers for the first 6 months.
Simply put, sign up, transfer a balance from another card to the new one and enjoy a low or no interest promotional period anywhere from 3 months to a year depending on the offer. Then focus on aggressively paying off that balance before the special rate expires. You’ll end up paying it off significantly faster and save yourself a ton of money on interest charges.
If you still have a balance owing when the promotional period is up, find another card with a balance transfer deal. Just make sure you do it before your promo period ends so you don’t get charged a dime of interest. Repeat this process until you’ve paid it off in full.
Invest your cash back rewards in a tax-sheltered investment account
If your cash back points show up in your bank account, simply move that money into your investment account like your Tax Free Savings Account (TFSA) or Registered Retirement Savings Plan (RRSP). Yes, it blew my mind too. The only thing better than free money is free money that makes more free money.
All those cash back rewards will be issued to you in one of two ways: a credit onto your card, or a cash deposit into a linked bank account. For example, Tangerine deposits cash back rewards from their credit card into their client’s linked Tangerine bank account. While others will process a deposit onto the credit card itself.
Get the Tangerine Money-Back Credit Card today to start making money. Their current sign up offer includes 10% cashback on $1000 of credit card purchases in the first 2 months. But only for a limited time.
If you’re a more hands-on investor, move that money to your Questrade or Wealthsimple account to buy stocks. If it’s processed as a credit onto your card, no big deal. Use your card for the next few budgeted purchases, like groceries or your phone bill, to use up that credit. Then take the money you would have spent from your grocery budget and transfer it to your investing platform of choice.
Take advantage of sign up bonuses
If you have decent credit and never carry a balance, start hunting for lucrative sign up bonuses. Just make sure the type of rewards align with your spending habits, lifestyle, and the things you love. If a card offers an incredible deal on something you value, go for it. Sign up. Get yours!
But, pay close attention to the fine print. Often, there will be conditions attached to the offer like “get up to $300 in cashback rewards when you spend $2,500 in the first 3 months.” That means you need to spend $2,500 in 3 months in specific spending categories in order to get that money. Make sure that fits with your budget and spending habits. Also, ensure you can pay it all off in full. And confirm that the merchants who sell the things in those spending categories actually accept the card.
Personally, I hate travelling far from home, especially with my tiny humans. Flying with small children is a fool’s errand. I like to eat, sleep and repeat. Cards that offer competitive cash back rewards on groceries and dining out are right up my alley. Give me that plastic!
But if you love to travel, you can sign up for the Air Miles Reward program. If you want to double-dip, sign up for an Air Miles reward credit card too.
Right now, the BMO AIR MILES World Elite Mastercard is offering 2000 bonus miles when you sign up, and they waive the card fee in your first year. That’s $210 worth of Air Miles and a $120 annual fee waived for a total of $330 in perks and savings.
Use your credit card with cash back apps
If you’re not double-dipping cash back rewards, you’re doing this all wrong. We already talked about the cashback rewards the credit card issuer gives you. But now we need to talk about using your credit card to purchase items through cash back apps. Double that income stream or go home.
Hopefully, you’ve heard of cash back apps like Rakuten or Checkout51. With these apps, you make money by purchasing goods and services through their affiliate merchants. You do this either through an app, a browser extension or by uploading your receipts.
There’s a new app on the block called Drop that allows you to connect your credit card! By using your credit card to shop through Drop you’ll get cash back rewards from the card issuer AND drop points from the app that you can spend at all your favourite retailers. Paymi offers the same credit card linking feature and you can transfer your cash back balance to your personal bank account.
Earn more credit card rewards with a supplementary card
You’ve mastered the double-dip. But did you know you can triple-dip? Be still, my heart. If you really want to level up, think about getting a supplementary card for a partner, significant other or even a child (within reason). Just make sure to choose someone you know you can trust. They will be given their own card and authorized to make purchases, but the account is in your name and you are 100% solely responsible for the payments.
Having said that, two is better than one. If you can double up spending you can fully maximize all the rewards that card has to offer. Make sure you’re both on the same page about the budget, how and where you spend, and which cash back apps to use.
Take advantage of in-store cash back promotions
Forget those sketchy secret shopper spam emails. I am going to tell you the only legitimate way to make money shopping. Use your cash back credit card to shop at affiliate stores when they offer rewards promotions. How many times have you seen “ get 3x the Air Miles rewards when you shop at (insert store here).” Those deals are amazing. But they’re not reserved for Air Miles maximalists.
For example, PC Financial and Shopper’s Drug Mart are owned by the same parent company. The two often run complimentary promotions. You can earn and redeem PC Optimum points at either store. Shopper’s Drug Mart often runs bonus point deals, and sometimes entire days that offer bonus points storewide. They also have Redemption Days that give your points extra value when you redeem them on in-store purchases. Basically, they gave you money, and now they’re going to pay you to spend it. The PC Financial Mastercard is so giving, if it were a man I would marry it.
Use the free insurance and warranty offers on your credit card
If you’ve ever bought an extended warranty, you’ve been had by The Man. Almost all credit cards, I repeat, almost all credit cards offer some sort of free travel medical insurance and extended warranties on goods purchased with the card. While the types of insurance and warranties differ from card to card, I can guarantee you have coverage for something.
Some cards offer supplementary car rental insurance. Others offer free travel medical insurance or trip cancellation insurance when you book with that credit card. And many of them offer extended warranty coverage on items you purchase with the card. Sometimes that coverage is even better than what the merchant or manufacturer offers. I wish I had known that before replacing my laptop that died within a year of purchase. Live and learn.
The BMO Cashback World Elite Mastercard offers some of the best purchase protection on the market. They’ll pay for items that have been damaged, lost or stolen within 180 days of purchase. And they extend the manufacturer’s warranty by up to 2 years.
Get paid to refer your friends
Word-of-mouth recommendations are the best form of advertising for any company. If you love your cash back credit card, then cash in your passion. Some credit cards offer additional cash back bonuses when you refer a friend. Simply spread your personal referral code along with all that credit card love. If one of your friends uses your code to sign up, you’ll both get extra perks.
If you’ve already been singing their praises, stop working for free. Volunteer for your favourite charitable organization, not your credit card company. Contact your credit card issuer to find out if they offer any referral incentives. Grab your code and start making money off your friends without sliding into their DM’s to sell cringy diet supplements.
I don’t know about you, but I love free money. If you have some plastic in your wallet, you can start earning free money too. With these 10 outrageous tips, credit card hacking has never been easier. Just remember these 3 simple rules: live within your means, track your spending, pay your balance off in full every month. Choose the best credit card for your needs and happy hacking!
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About The Author: Heidi Unrau
Heidi Unrau is the senior Finance Journalist at Hardbacon. She studied Economics at the University of Winnipeg, where she fell in love with all-things-finance. At 25, she got her first bank job as an entry-level teller. She moved up the ranks to Credit Analyst, Loans Officer, and now a Personal Finance Writer. In her spare time, you'll find her hiding in the car listening to Freakonomics podcasts, or binge-watching financial crime documentaries with a pint of Häagen-Dazs. When she's not chasing after her two little boys, she's in the hot tub or arguing with her husband over which cash back card to use for date night. She’s addicted to coffee, crypto, and obsessively checking her credit score on Borrowell.
Fun Fact: Heidi has lived in five different provinces across Canada, loves her free Tangerine bank account, and will never cut back on Starbucks. Like ever.
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