About 2 years ago, I was looking to build up a good credit history while saving money on gas. Shell offered a 10% cash back on all Fuel purchases for 3 months with their Shell Mastercard from Citi. After the 3 months, it reverts to 5%. I decided to sign up. It worked like a charm. I made all of my gas purchases on the card, received my statement online and paid the balance in full. It showed I earned around $15 in free gas during that month. The next month, there was an automatic statement credit of $15 towards any balance I had.
I used this card for gas purchases only for about a year. Then I got smart. Everything that I could pay with a credit card, I used my Shell Mastercard. While I only receive 1% cash back on all other purchases, it does add up. I am now married and my expenses have increased. My wife uses the card for her gas and purchases and my rebate increased substantially. What started out as around $15 a month for gas only, I am now averaging $45 a month statement credit. This is automatically taken off my balance. No points to accumulate, no waiting for a year, no minimums. Cold, hard, cash back for free.
I must stress that you pay off your balance in full every month. Shell will allow you to make up to 4 payments per month online. I pay my full balance at the end of every week so I do not get behind. This means they cannot charge me any interest and I reap all the rewards. If you do not pay off your balance, this strategy is useless. You will pay more in interest that the rewards you accumulate.
If you want free gas, go with the Shell Mastercard from Citi.
http://www.866getshell.com/
Monday, March 26, 2007
Tuesday, March 20, 2007
Credit swap
Transfer those balances. I have safely transferred balances from old credit cards to new cards for 5 years now. Find a credit card that offers no balance transfer fees and no interest for a year (15 months comes around too). The key to no interest is to not use the card! Transfer the balance and put it in the drawer. I would say cut it up, but sometimes you must provide the full card number when calling customer service. Three cards that I have used successfully are:
Discover Platinum Card
12 months no interest, no balance transfer fee
$5,000 initial credit line
Bank of America
not as good, only 6 months no interest, no balance transfer fee
$5,000 initial credit line
Citibank
12 months no interest, no balance transfer fee
$2,800 initial credit line
All three of these were very easy to apply for online and had no problems getting accepted. I also have a credit score 715-760 so it makes it easier. If you have bad credit, it might be harder to get approved and transfer the balances, but it's worth a shot.
I also do not recommend having a balance over $2,000 at anytime. It is easy to keep spending when you see that you have all that credit limit left, but you need to keep your debt to credit ratio below 20%. I try to keep mine around 15% at the most.
Discover Platinum Card
12 months no interest, no balance transfer fee
$5,000 initial credit line
Bank of America
not as good, only 6 months no interest, no balance transfer fee
$5,000 initial credit line
Citibank
12 months no interest, no balance transfer fee
$2,800 initial credit line
All three of these were very easy to apply for online and had no problems getting accepted. I also have a credit score 715-760 so it makes it easier. If you have bad credit, it might be harder to get approved and transfer the balances, but it's worth a shot.
I also do not recommend having a balance over $2,000 at anytime. It is easy to keep spending when you see that you have all that credit limit left, but you need to keep your debt to credit ratio below 20%. I try to keep mine around 15% at the most.
Make money going to school
If you find yourself in a bind, go back to school. Granted, your income must be at a certain level to obtain financial aid, but if you are above that level, you don't need help anyway.
My job pays up to $3,500 a year for approved education courses. I still apply for the maximum financial aid. Why? Because I can get a subsidized loan and put it in the bank.
ING direct draws 4.5% right now.
Assume a $5,000 loan with no interest and no payments while in school.
You can earn about $250 in interest on the year.
Grad school takes around 2 years going to class at night and I was approved for $6,000 a year in subsidized loans.
After I am done with school, I make a one time payment and keep the interest. Work pays for my school, but pays it directly to me, not the school.
While this is only a feasible solution if you want to go back to school, it may be a reason to get the Master's degree you have been putting off. You must be diligent and not spend the money. You can also put that same money in a CD and earn a little more, but there may be early withdrawal penalties for an emergency.
My job pays up to $3,500 a year for approved education courses. I still apply for the maximum financial aid. Why? Because I can get a subsidized loan and put it in the bank.
ING direct draws 4.5% right now.
Assume a $5,000 loan with no interest and no payments while in school.
You can earn about $250 in interest on the year.
Grad school takes around 2 years going to class at night and I was approved for $6,000 a year in subsidized loans.
After I am done with school, I make a one time payment and keep the interest. Work pays for my school, but pays it directly to me, not the school.
While this is only a feasible solution if you want to go back to school, it may be a reason to get the Master's degree you have been putting off. You must be diligent and not spend the money. You can also put that same money in a CD and earn a little more, but there may be early withdrawal penalties for an emergency.
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