It should be no surprise that I use credit cards to get as much cash back as I can with the credit cards that I currently have. I even signed up for a new credit card this year in order to take advantage of a sweet credit card sign up bonus to earn even more cash back.
Many people dismiss using credit cards to gain some extra income. Using credit cards to gain rewards or cash back is not for you if you can’t control yourself. I never spent more than I would with cash (despite the studies you’ve read) and I always pay my balance off in full every month.
I’ve never paid a dime in fees or interest (other than carefully calculated annual fees, such as with the Blue Cash Preferred® Card from American Express, which I may get in 2013). If you can’t follow these rules then using credit cards to get rewards or cash back will likely be counter productive because the fees (late fees, over the limit fees, etc) and interest will greatly outweigh any rewards or cash back you earn.
How Much Money I Made from My Credit Cards
In 2012 I used a combination of three credit cards to earn my cash back. I currently have a Chase Freedom credit card which pays 5% cash back in quarterly rotating categories, a Chase Sapphire Preferred credit card which pays 2% cash back in travel and dining and a Navy Federal Cash Rewards credit card which pays 1% cash back on purchases up to $10,000 a year and 1.5% cash back on all spending above $10,000 for the year.
I use my Chase Freedom credit card only for purchases that are in the rotating 5% categories. There were a couple quarters that had categories I spend a decent amount of money in such as gas stations and supermarkets. I was also awarded a sign up bonus of $200 in January of 2012 even though I signed up for the card in 2011.
In total, I earned $321.19 in cash back on the Chase Freedom credit card in 2012.
Chase Sapphire Preferred
I signed up for the Chase Sapphire Preferred credit card this year due to the $400 sign up bonus. I did have to meet a hefty minimum spend threshold in order to get the $400 cash sign up bonus but it wasn’t a problem for me because I was buying an air conditioner.
I also earned 2% cash back on travel and dining spending on this credit card. I made sure to charge my Disney World travel spending and my first cruise to this card to get 2% cash back on those vacations. I earned $167.34 in terms of non sign up bonus cash back.
In total, I earned $467.34 in cash back on the Chase Sapphire Preferred credit card in 2012.
Navy Federal Cash Rewards
The Navy Federal Cash Rewards credit card is my fall back cash back credit card. Any spending that doesn’t have a higher cash back percentages on another credit card gets charged to my Navy Federal credit card.
In total, I earned $140.78 in cash back on the Navy Federal Cash Rewards credit card.
Total Cash Back in 2012 from Credit Cards
If you add up the cash back I earned from these three cards, I earned a total of $929.31! That’s pretty awesome considering I just spent money like I normally would. All I had to do was swipe a piece of plastic instead of trying to remember how to write a check or swiping my debit card (which I never use).
Do you use credit cards to earn cash back or other rewards? Which cards do you use and which do you suggest I try out?
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