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How to Get Free Stuff From Your Credit Card

[June 17th, 2013]

It has often been said that there is no such thing as a free lunch—but if you know how to use your credit card wisely, you can get a lot more than a free lunch. You can get free flights, free hotel stays, free gift cards, and free money.

There are two keys to getting free stuff from your credit card. Here is the first key: always pay off your balance in full each month. When you never carry a balance from one month to the next, you will never be charged interest. So just make sure you have the money on hand to pay for what you spend, and you never have to worry about your interest rate.

The second key is to have a rewards credit card that will let you rack up points, miles, or cash back with every swipe. Choose your favorite way to get rewarded and pick a card that offers the biggest payoff in that category. Cash back cards give you just that: cash to use however you want. Points cards give you flexibility to use the points to purchase gift cards, merchandise, convert to cash, or trade in for frequent flyer miles. Miles cards are targeted to travelers who want to use their rewards to circle the globe—or just visit the folks back home every once in a while.

Now you know how to get the free rewards you want from your credit card. The only thing left is to actually put the plan into action. If you are not sure you can avoid interest fees, read on:

If you have trouble paying off your credit card when the bill is due each month, here is a method to help make sure you have the full amount when that “due date approaching” reminder comes. It might seem a little bit tedious, but it is a sure-fire way to keep from carrying a balance.

• Open up a no-fee linked savings account along with your checking account.
• Set up online access so it is easy to transfer money from one account to the other.
• Every time you make a purchase with your credit card, log in to your bank account and transfer the amount you just spent into your linked savings account.
• As soon as your credit card statement arrives in your inbox, transfer the money from your savings account to your checking account, and then pay the credit card bill. Do not wait until the due date. Pay as soon as the bill arrives so you don’t leave it to the last minute.

If you have followed this method, then every time a credit card bill arrives, you will have enough in your savings account to pay it off. Most banks let you give your accounts nicknames when you set up online access; you can nickname your savings account “Discover Card bill” or “Chase Card bill” to help you remember what that money is for.

It’s easy to get a free lunch (or dinner, or flight, or VIP hotel suite) when you know how to win the credit card reward game.