Cashback v 0% interest free

pcyam

I have read alot about the best cashback credit cards and the best 0% credit cards on this site (and appreciate all the info people have given). Personally, I've always used the cashback ones as i pay off the whole amount, and never ever thought about making money at the banks expense by stoozing.

But what i really want to know which is the best stoozing or just sticking to the cashback system.

Would anyone like to enlighten this newbie (which thought was pretty clued up, but obviously not)

Thanks

Clariman

You can make a lot more money from stoozing than cashback. With the former, it is likely to be measured in high hundreds or thousands of pounds per year, with the latter it will be 10s or low 100s of pounds. There is a brief intro and comparison here.
Clariman

laurat

Hi pcyam,

In terms of potential gain I would say that stoozing is most definitely the better of the two, because the gain with cashback cards is limited to the 1% (max 2%) return most cards tend to offer and there is usually a cap on the amount of cashback you can earn.

If you're able to stooze with credit cards the potential gain is far higher, especially if you utilise the highest interest savings account for your 0% cash (ie. atleast 5%). Your gain is also limited only by how high a credit limit card providers will allow you. The only word of warning I would give is that there are of course many pitfalls one can encounter with stoozing, so I'd advise making good use of the advice given on this forum by some of the more experienced stoozers.

HTH

laurat

Sorry Clariman you beat me to it!

bunking_off

Why restrict yourself to one or the other?

I've got a bespoke deal from the provider of one of my cards, giving me 2% cashback with no caps. Obviously all my day to day expenditure goes through that, paid off in full.

I've got stoozes running on 3 other cards, with the "temporary donation" knocking £30k of my mortgage.

My advice would be to stooze in general, but get one card that offers cashback and use that for day-to-day expenditure.

pcyam

Thanks for all the advice,

Just to make sure that I've read this correctly, Stoozing, to start it off, I need to take out a 0% interest free card for eg 9mnths and just use it in shops and then once the term has finished transfer it to a different provider, is this correct??

Anwen_2

No, I think the idea is to find a card which enables you to 'pay off' a fictitious overdraft by transferring the full amount of the credit limit to your current account. Then you can put that money in a savings account. You could also presumably then take out a different 0% BT card and 'pay off' the first card, which would then let you use the first card to 'pay off' your 'overdraft' again. And so on.

You obviously have to pay the minimum payments regularly and watch out for the end of the 0% deals.

Main thing is to research very very carefully and know exactly what you're doing.

And, if you're not 100% sure you'll have the discipline and remember to keep up with it all, DON'T DO IT!!!

Chadsman

bunking_off wrote:

I've got a bespoke deal from the provider of one of my cards, giving me 2% cashback with no caps.

2% :eek: :T
Who gives you % cashback? amex?

bunking_off

Capital One

michaels

One question tough - am I better off with my 1% cashback circle card or would I be better off getting a 12 month 0% purchase card and building up a stooze over the 12 months thus earning approx 11 months x 5% on my first months spending, 5% x 10 months on the second month and so on?

YorkshireBoy

michaels wrote:

One question tough - am I better off with my 1% cashback circle card or would I be better off getting a 12 month 0% purchase card and building up a stooze over the 12 months thus earning approx 11 months x 5% on my first months spending, 5% x 10 months on the second month and so on?

£1K/month spend on your 1% cashback card will earn you £120 for the year.

£12K spent on a 'slow-stooz' project at £1K/month will give you an average stooz pot balance of £5,943 over the 12 months - after 2% minimum payments are factored in.

Assuming this (average) £5,943 sits in an A&L OS2 account, you'll make £245 after basic rate tax. This also assumes you can actually 'get' a 12 months 0% on purchases card. If not, then you're changing cards every 6-10 months.

Note: If you could get a £12K limit on a card (required to finance the above project - unless you get interim credit limit increases), then you'd do better to 'fast-stooz' this and make £435 over the same period.