In recent years credit cards have become a big taboo, credit card companies are seen as a big evil entity out to get everyone. However, the truth is that it is not the credit card that gets people in financial trouble, but the people who use them recklessly. Credit cards are an important tool in your financial arsenal, among many other things they can be great for cash flow management. Cash back credit cards, such as the MBNA Smart Cash®, also have the added benefit to help you put a few dollars back in your pocket.
Personally we have been using a cash back credit card for a few years and every year we get back around $500-$600 for just paying our bills.
The MBNA Smart Cash®
There are a few cash back credit cards available in Canada, however I find the MBNA Smart Cash® to be one of the best ones out there. The best part about the card is that it has NO annual fees! Most cash back credit cards have an annual fee, which reduces your earnings, however with the MBNA Smart Cash® there are no fees.
With their current promotion MBNA Smart Cash® gives you 5% back on groceries and gas for the first six months. For us, these two make up a large chunk of our expenses. After the first six months you will continue to receive 2% cash back on gas and groceries and 1% on everything else.
How Much You Can Earn With The MBNA Smart Cash®?
Let’s look at a quick example on how you can earn money with the MBNA Smart Cash®. Let’s say you spend $600/month on gas and groceries and another $900 on other bills (drugstore, cell phone, internet, cable etc.) what would you earn?
- On gas and groceries you will earn $30/month first 6 months and $12/month after that. In the first year that is $252.
- On the remaining $900 you will earn another $9/month for a total of $108 in a year.
- Total cash back earned over the first is $360.
- Second year it will be $252.
Just by using a cash back credit card you are already closer to your financial goals.
Of course this only works with responsible credit card. Make sure you pay the balance off within the grace period and don’t incur any interest. Earning $400 in cash back, but paying $500 in interest is counter productive.
You can apply online and start using the card when you receive it, as soon as your earnings reach $50 they will send you a cheque.