Spenders who choose the right credit card deals could earn more than people who put their money in savings accounts, according to new research.
A new study from Moneysupermarket.com revealed that 60 per cent of credit card users pay off their balance each month, which means they are in line to benefit from the great cashback offers that are around. Wise spenders will invest their salary into a high interest savings account while using a credit card for their everyday spending. If a credit card with a generous cashback offer is used, this could earn credit card holders on a medium salary as much as £549 per year.
An example would be the American Express Platinum Cashback card, which would pay out £424 per year if the user spends £2,500 a month on the card. Combine this with the interest earned on holding a salary in a high interest account, and the card holder is at least £500 better off over the year.
Moneysupermarket's head of banking, Kevin Mountford, explained, "With rising inflation rates and the recent hike in VAT, times are tough for UK households and consumers need to be a little more creative when it comes to their finances, and a cashback card can be a great way to generate some extra income."
