DebtSmart®: How I Made an Easy $1,800 Profit with My Credit Cards

Hi Scott,

I recently heard you on NPR radio 90.9 FM WBUR from Boston.

I was interested in how you borrowed from your credit card at a low interest rate and then invested it in a CD and earned about $1,800.

Which of your books covers that interesting topic? I'd like to know more!

Thanks,

Leo

Leo,

Thanks for listening! This is always a topic of interest by hosts and listeners. That is, making money using credit cards.

People are always looking to make something from nothing, and that may be possible in this case. However, for most, the way to gain, bigtime, is to use similar techniques to save money on existing debts.

Actually, I didn't put the money into a CD; it was a money market account. Also, most of the details of how to get these low-rate deals, and manage them successfully, are contained in all of my best-selling books, Credit Card and Debt Management, How to be more Credit Card and DebtSmart, and Talk Your Way Out of Credit Card Debt.

First off, I want to be clear that I'm not recommending that you do this; game the system to make a profit. I present it here for your pure entertainment. "Kids, don't try this at home." I don't want to hear that someone cash advanced money and got into more debt. Because you do get into more debt. Okay, so now that I'm disclaimed and all (I hope), here goes.

My original intent was to experiment with what would happen to my credit score if I suddenly added $62,000 to my debt load. Also, I wanted to test a zero-percent transfer offer to see if there were any catches and/or extra charges.

I took advantage of four zero-percent offers totaling $62,000 and put that money in an ING Direct Money Market. These offers were good for one year; the rate ING was paying at that time was around 3 percent. I held the money there for one year and paid it back to all cards when the offers expired.

The total interest earned from that experiment was $1,800! For the first time in my life, I was actually profiting from using my credit cards. It was like a refund for all past interest charges sucked out of my personal economy for the last 15+ years!

I also learned a few things that I will discuss briefly: