It’s all over the news: banks are raising fees and good banking deals are harder to find. However, if you’re one of the lucky few who have excellent credit, there are still good deals to be found. Banks may be implementing fees for debit-card use, but there are some great free credit cards out there that pay you cash back for each purchase. As long as you can afford to pay off the balance each and every month, it’s a good alternative to paying debit card fees. An excellent one to consider is the Capital One Cash Credit Card.
This card has no annual fee and offers 1% cash back on all purchases. Additionally, until September 2012, it has a 0% Purchase and Transfer APR (after that, it’s a 12.9% to 20.9% variable APR). The cash back and the no-annual-fee feature alone make this card enticing, but this card offers some nice extra perks.
Ever year, the card will give you a 50% bonus on the cash back you have already earned for that year. So, if you earn $240 in cash back over the course of a year, you’ll get an extra $120 bonus at the end of the year. You will also get an additional one-time bonus of $100 once you spend $500 in the first three months. If you are using this card to replace debit-card spending, that bonus will be very easy to achieve. So, if you spend (and pay off) approximately $2,000 per month on your card (earning you the $240 annual cash-back bonus in the above example), you will earn $460 your first year in cash-back rewards and bonuses. Your cash rewards never expire, and you can request your earned cash as an account credit, as a check, or as a gift card. There is also no limit to the amount of cash back you can earn.
However, as previously mentioned, this card is only for people with excellent credit. What does “excellent credit” mean? According to Capital One, you must meet all of these requirements:
- You cannot have been more than 60 days late on any credit card, medical bill, or loan in the last year
- You can never have declared bankruptcy or defaulted on a loan
- You have had a loan or a credit card for three years or more with a credit limit above $5,000
Although Capital One doesn’t mention a credit score, generally “excellent” scores are considered to be mid-700’s and above.
In this economy, it may be hard to meet Capital One’s requirements due to circumstances beyond people’s control, like job layoffs. However, if you can meet the requirements, this card is a great way to put potentially hundreds of extra dollars a year into your pocket. Why pay debit card fees when you can have a bank pay you instead?
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