One advantage of building a strong credit rating is that you begin to receive many credit card offers with introductory 0% APR for six months or a year.
These cards are great if you’re carrying a balance on another card; request a balance transfer when you sign up and the interest goes away.
Of course, any time that a bank offers to save you money, there is a way to use that offer to make money for yourself. First, apply for a credit card where you can get a strong credit limit. This first card is not as important as the others; don’t worry too much about a long-term APY. As soon as the card is opened, withdraw as much as you can as a cash withdrawal from the card and deposit that amount in a high-yield savings account. Then, obtain a second card, this one with a long-term introductory 0% APY, and transfer the balance from the first card onto the second one.
Let’s say that the first card allows you to get a $3,000 cash withdrawal and then you transfer that balance at 0% APR for a year onto the second card. If you put that money into HSBC Direct, earning 5.05% APY, you’ll earn $151.50 for spending an hour or so juggling cards. Plus, at the end of the year, you can get a cash advance from this second card, then transfer that entire balance to a third card, where it can sit for a year. If you can get another $3,000 advance, then transfer and wait another year, you’ve made a total of $462.15 for maybe two hours worth of work. If your credit is strong, you may be able to get even larger advances and thus profit more than that.
