Let’s face it, banks aren’t your friend. They count on you using your money improperly and will charge you outrageous fees and interest for doing so. However, if you are responsible with your money, you can turn the tables on them. Here’s how:

Let’s say you spend around $1,500 a month on “stuff” (groceries, gas, haircuts, household items, etc.). If you use a 2% cash back credit card, the bank will pay you $30 for that spending AND will give you a 30 day grace period to pay for it.

So, at your credit card due date, you should owe $3,000 ($1,500 from the last statement plus $1,500 in current months spending). You pay the $1,500 at the due date and have another 30 days to pay the other $1,500.

Do you see what just happened? Not only are you making $30 each month in cash back rewards on your typical spending but the bank is giving you an interest free personal loan of $1500.

So, you should 1) Never be using a debit card for anything, 2) Always be using a cash back rewards card and 3) Always have a balance on that credit card that you pay 0 interest on.

Planning tip: Make certain that the carrying balance on the credit card never exceeds 10% of the credit limit (request a higher limit if necessary) to maximize your credit score.

You always thought credit cards were evil didn’t you?