CREDIT cards aren’t the first things that come to mind when considering ways to make money.
Credit cards can be controversial, as Callum mentions.
But if you know how to use them to your advantage, they can be a handy tool to build wealth.
Credit cards can be used to build up a credit score, which in turn can help you buy a home or lease a car.
Your credit score is basically a determination of how well you manage your debt.
If you make timely payments and keep a credit utilization ratio of around 30%, you’re likely to maintain a decent credit score.
This can help you acquire lower interest rates when it comes time to purchase that home or car, which can save you money and make your investments more profitable long-term.
Rewards and cash back
When considering which credit card to apply for, it’s worth looking at the rewards and benefits each card offers.
As Callum notes, many cards offer cashback rewards, and by putting your typical spending on a credit card instead of a debit card, you can profit.
However, he does note that you shouldn’t spend more on these cards thinking that you’re profiting.
It’s important to not spend beyond your means and to make timely monthly payments, so as not to damage your credit score.
Business cash flow
Callum states that having a business credit card can improve cash flow, too.
Using a card with a cashback rewards system could provide an opportunity to reinvest the cash into your business, adding to your profits.
It also provides additional income and cash flow, in addition to building your business credit.
We explain how you can earn money from shopping online.
We also explain how you can boost your credit score before the end of the year.
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