Take advantage of the 0% credit card offers?

dcrum0 · Joined: 18 Feb 2008 Posts: 19 10.21 Dollars($)

A few days ago I stumbled on a blog where a guy discusses how he takes advantage of all the 0% interest rate credit card offers. Every year he makes about $3,000 from rewards and signup offers. He pays all his bills and expenses on the cards with rewards. He has also found ways to get cash into his savings account from the offers without paying balance transfer fees. He keeps the money in the bank, collects the interest for the entire period then pays the balance off before the offer ends. Every year he uses the money to fund his roth IRA.

I think there are lots of risk with this but isn't there risk in any non FDIC insured investment? Just curious of what you guys think about his plan. Can you actually beat the credit card companies at their own game? I'm doing some research about this so I can write an article about this at my blog. Thanks for the input.

sara

Hi Drum,

Welcome to the forums.

I guess the guy has thought of wisely while planning his finances. he is well aware of how to save and invest his money for future. However, 0% balance transfer have their disadvantages too.

As for investments not insured by FDIC, well, there are higher risks associated with them as far as your profit from such investments are concerned. You may even suffer a loss in retrieveing the principal amount invested.

Take Care

Guest

I think that's great planning by the blogger. but how does he get so many dollars as rewards. He must be giving a lot of attention to these offers and rewards. But hey dcrum, are you planning to go for such a plan?

michelle · Posted: Sat Apr 05, 2008 5:57 pm Post subject:

Welcome to the forums dcrum0,

Although on the surface the plan does appear quite clever, my biggest concern would be the damage being done to the poster's credit. Anytime one opens a new account, the individuals credit score drops. The other ramification is that having too much available credit can be just as detrimental to a persons overall credit profile as not having enough.

Just a little extra food for thought. Please let us know if you have any additional questions.

jbarto65 · Joined: 04 Nov 2007 Posts: 623 -0.20 Dollars($)

True, I have learned a lot of these lesson the hard way, sometimes I wonder if it is worth the struggle. I have just resorted to dealing with the bills that I have and not making any bills, just seems like I can't get a descent rate anyway. So I am staying where I am, I don't need the hard inquiry dropping my score and not getting a good rate or to be completely turned down anyway.

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