Cashback Credit Cards / questions about paying off in full.

moonklash

Hello there,

I've just read Martin's excellent guide to cashback cards and when my car insurance is due in April/May time I''m planning on getting the Amex, buying the years car insurance thus saving a little on the interest you usually get charged and making something back in cashback.

Having never owned a cashback card before, I have a couple of questions:

1) When are you given the cashback? Is it just a credit into the account once a month?

2) Martin says to make sure you fully pay off the card each month to prevent large interest fee's. This is going to seem like a silly question but something that has always confused me is how to do this: If I use the redit card and get, say, an £800 bill on it at the end of the month - if I then pay that off, only to spend on it the very next day (which I would do in order to take full advantage of the 5% cashback offer) - does this qualify as having paid it off? Does the card have to have a balance of £0 for a set period before it's classed as cleared?

Thanks in advance, I know this is a great site and value all of the suggestions and advice given here

Stu.

ryandj

1) Check the T&C for your credit card - when I had an Amex cash back card it was on the 1 year anniversary of account opening

2) Yes, this qualifies as having paid it off. The best thing to do is set up a direct debit to pay the full amount each month, that way you never miss it and never get charged interest. If you want to really maximise the 5% offer (and need to buy stuff, not point spending lots when you don't need to just to get 5% cash back) then spend up to your credit limit, pay it off, repeat .... you don't need to wait till the monthly bill to do this.

[Deleted User]

Cashback is normally paid once per year - although I cannot say how Amex do it. (I'm with Cap.One).

It is normally accrued throughout the year and with Cap.One, - is paid off your balance - so effectively you have that amount less to pay.

To take full advantage of any cashback - you must pay off your balance every month - or you will incur hefty interest charges - which eats into or even wipes out any cashback.

The very best way to pay it off every month is to set up a direct debit for the full amount - that way you get no late payments. This is especially important as Royal Mail cannot be relied upon to deliver your statement every month before the due date. (Mine used to go missing regularly until I decided to go 'paper-free' and operate my account online).

If you cannot afford to pay it off in full every month then there may be better cards out there for you - i.e those with low introductory interest offers.

moonklash

Thanks guys, that's great and answers all of my questions

I'm only going to use the card during the first three months (or that's the plan). After then I guess I'll just keep it until cashback comes through. It's useful to know that most companies only give it back after the year as I'd planned to use the previous months cashback to help pay the next months bills (not an option then).

ryandj

Also - don't cancel your card before the year is up, else you won't get the cash back.

Inactive

Barclaycard ( formerly Morgan Stanley ) pay back on a month by month basis.

bitterSTAR

I would keep using it past the first 3 months, for the whole 12 months. Caus all your spending for the whole year will contribute to the amount of cashback you receive.

paulfranks

by the way this also applies to insurance because at least two of the participants offer insurance services! paul from wakefield

paulfranks

to 'another paul' - i'm a customer and just sharing some good news. not all cashback cards have tie-ins. the site is about saving money or have i missed something?

anotherpaul_2

paulfranks wrote: »

to 'another paul' - i'm a customer and just sharing some good news. not all cashback cards have tie-ins. the site is about saving money or have i missed something?

It would appear less like you were trying to solicit customers to claim a finders fee if you posted details of the card and not you phone number.

I appologise if I was genuinely wrong, but that's how your post looks to me.

paulfranks

sorry another paul, new to this not sure how it works exactly.