So now you’ve been following along for a while. You got your finances in order, set a budget, and now are eager to reap the rewards credit cards have to offer. This has been my most asked question on the blog lately. How can I score free stuff with credit cards? I’ll show you how to ease into credit cards by “graduating” slowly into premium better reward earning cards.

Start Simple

If you don’t have a starter everyday credit card I recommend getting the Discover it card*. This card is good to start out because it gives a basic 1% cash back on all purchases and up to 5% on rotating categories. Even better on your first year they will match all your cash back 100%. So the 1st year of purchases it’s like you’re getting up to 10% cash back. I think this is a good card to put into rotation because it offers an astounding 5% cash back for no yearly fee. Usually credit cards that offer 5x rewards in any category charge yearly fees making this one very competitive.

A second starter card I recommend is the Chase Freedom Unlimited. Although this card doesn’t have a 5% rotating category, it does offer unlimited 1.5% cash back on every purchase. Not forget no yearly fee either. It also opens up the word into the Chase ecosystem which gives you access to their travel portal. I really recommend people to add this card into their rotation because in the future if you ever consider getting the Chase Sapphire either the $95/year or $550/year you can redeem all the points you accrue for free travel. Usually for the more premium cards points can even be worth up to 1.5x. So 60,000 points will give you $900 in travel credits.

Specific Reward Categories

There are also credit cards out there that reward you for specific categories. Let’s say you eat out a lot. Two cards that come to mind are the Capital One Savor, and American Express Gold Card. Travel a lot? Chase Sapphire, Capital One Venture X, American Express Platinum. These cards require excellent credit to qualify so before you move on to specific category cards I’d recommend slowly easing in with the general cash back cards with no fee. Also these cards all charge a yearly fee, and it can range up to $695/ year. So you really have to do the math to see if the card will be worth it for you.

Is It Worth It?

Let’s take the Capital One Venture X for example. This is a popular upcoming card but even though it’s $395/year, let me tell you how this card is going to be paying you $5 for getting it. They offer a $300 a year travel credit which can be redeemed for flights/hotels. Ok now that technically makes the fee $95. They also give a 10,000 mile bonus worth $100. That makes the fee $-5. Wait you just got paid $5 to get a credit card?? This isn’t even including other benefits like lounge access and priority pass which retails for about $469 a year. But you do the math, are these benefits worth the $395 a year fee? Don’t forget that you actually have to use the card to get points and rewards.

Don’t Pay Interest

Pay off your card in full each month. This should be known. Paying interest on any purchases will offset anything that the credit card gives you for free. If you’re paying $200 a month in interest the $50 in cash back they give will barely cover less than a month of interest charges. So continue budgeting accordingly and enjoy those rewards you’re earning, responsibly!

I should also include that this should all be rewarding your everyday spending habits. Buying things that your would normally buy. Then the points will be rewarded on top of what you normally do just by using credit instead of cash/debit.

Easing In

Know your limits. Don’t apply for a credit card and spend recklessly just to meet a certain point criteria. Start with the starter cards and prove to yourself that you can pay them off every month. Funny enough, doing this to prove a point to yourself actually proves a point to your credit bureau and will raise your credit score. Once you can handle budgeting and successfully paying off your balances ever month you can slowly graduate into the more premium cards and reaping their benefits and start traveling/dining for free! If you’re still learning about credit cards or need advice on how to spend your money, check out my other chapters on credit!

*One or more links in this article are sponsored and will benefit me slightly, this is done with your interest in mind. These are products/services that I like and use and would like others to benefit off of as well 🙂

Thanks again for reading and see you next Sunday,
– Pablo