Cash Back Credit Cards | August 10

Cash Back Best Buy Guide Read more in... Part 1: How Do Cash Back Credit Cards Work? Part 2: How to Compare Cash Back Credit Cards Cash Back Credit Card Questions Got a Credit Card Question? Send your question to and we'll set our team of credit card experts to it! Most recent questions: How does a tiered cash back scheme work? Which is the highest paying cash back credit card? When and how will I receive the cash back I've earned? Why is it important to repay my spending in full when earning cash back? More frequently asked questions »

Part 3: Using a Cash Back Credit Card

Find out how to use your cash back credit card, earn some extra money and then get rid of it safely in our step by step guide.

How to use a Cash back Credit Card Step by Step

1. Apply for your cash back credit card - Once you’ve found your perfect cash back deal you can apply online on the provider’s site. You'll need details such as your pre-tax salary and your address for the past five years so try to have them to hand but otherwise it’s a simple form.
   
   The credit card provider will contact you by post. You may need to provide them with some additional details and after that you’ll receive your credit card.



2. Set up a direct debit - You won't make any money with a cash back credit card if you fail to pay your balance in full and if you don't make at least the minimum repayment you won’t get that month’s cash back so you'll make a loss.
   
   For these two reasons it's vital that you set up a direct debit as soon as your credit card arrives in accordance with the minimum repayment set out in your terms and conditions (although, ideally, you should try and pay back more than that).



3. Start spending - Now that you've got a cash back credit card the best way you can make the most of it is to start spending on the credit card straight away.
   
   The more of your normal spending you use the credit card for, the more cash you'll get so it might also be worth budgeting to see if you can afford to buy any upcoming large purchases with your credit card.
   
   Finally, it's worth checking that the transactions you're making will be counted as purchases and earn you cash back: for example, credit card cheques, gambling transactions and cash withdrawals won't be counted as purchases.



4. Only use your cash back credit card for purchases - You should only be using your cash back credit card for purchases.
   
   Why? Not only will balance transfers or cash transactions not earn any cash back, but cash transactions for example will incur interest from the date of withdrawal even if you pay it off in full - effectively destroying any cash back you've earned so far.
   
   Balance transfers should also be avoided and if you need to move an existing credit card debt then you should be looking for a specific 0% balance transfer credit card offers.



5. Use your cash back credit card like your debit card - Most of us have debit cards from our banks and tend to pay for many of our purchases with those debit cards. But the best way to get some of that money back from those purchases is to use a cash back credit card instead.
   
   Think of all the things you pay for with a debit card on a daily basis, for example groceries, petrol, meals out, cinema or theatre tickets, sports events. If you paid for them with a cash back credit card you could be earning anything from 0.5% to 5% back.
   
   Then there are the bigger one-off purchases such as holidays, flights, furniture, fridge, freezer, computer and so on. These are all purchases that could be earning you money just by changing the method (or plastic) that you use to pay for them.
   
   Don't forget - for those larger items you’ll also receive more protection against non-delivery or damage on arrival if you pay by credit card. While the majority of cash back credit cards allow you to earn cash back on all purchases - wherever you choose to spend your money, some cash back credit cards only offer cash back with selected retailers. If that is the case, just make sure you use the card whenever you shop at those retailers to make the most of your savings.



6. Increase your cash back earnings - There are many more ways to increase your credit card cash back rewards. Clothes, shoes, days out, presents, things for the home... the list is endless.
   
   If your utilities such as electric, gas, water, phone, mobile, Internet provider, allow you to pay by credit card, then do it. You have to pay them anyway, but now you’ll enjoy what’s effectively an additional discount.
   
   It's a simple equation - The more you spend with your cash back credit card - the more cash you get back!



7. Know when your cash back deal ends - If your cash back deal ends make sure that you note this date down.
   
   If you have been successful in using the cashback credit card then it will probably be worth you comparing reward credit cards again and little point in keeping a credit card that isn’t rewarding you anymore.



8. Stop using your cash back credit card - If your cash back credit card is no longer being rewarding and you’re not using it then its safest for you to close down the credit card altogether.
   
   You'll be able to find out more on how to do this in your credit card’s terms and conditions but you will probably have to write a letter to your provider with your credit card attached.
   
   Warning! Some cash back credit cards only pay out once a year, so you'll need to keep your account open and in goodstanding to receive your cash back - only once it's been debited safely in your account should you close the credit card account.

Cash back credit cards