How Can UK Cash Back Credit Cards Benefit Me?

The Truth

It is certainly true that the Bank of England has frozen the base rate. This would not necessarily be such a bad thing if it were indeed not the lowest rate in history. It also doesn't help that they have held this rate for over a year and shows no sign of letting up. Unfortunately, this is nothing unique, as financial markets all over the world are seizing up, with banks holding on to everything they can. Of course, countries like Greece, who have been ignoring their financial responsibilities, are finding this time very difficult. Indeed, any and all of the chaos spill over to other, much larger financially powerful countries.

It is also unfortunate for United Kingdom residents that the tax rates are finding those of the highest income brackets turning over as much as 50% of their income back to the British government. This means that even if the Bank of England was allowing for variable investment or savings rates, you would need to find a program offering 10 times that of the current rate just to come out slightly ahead. As you can imagine, this type of program does not actually exist, at least not at this time.

The Question

If you are being taxed to death and still barely making an income, how you would you save money? Would you cut back on the unnecessary expenses like eating out at restaurants or attending movies or the theater? Would you try to find something that you can invest in, even with the limited extra cash you have? Maybe you can afford to change where you are eating or shopping to something in a lower price range? How long can you possibly keep borrowing from one creditor to pay for another?

There must be a better way, right? Well, that is indeed the bigger question and the answer is not an easy one. However, there is one simple thing that many people do consider. It is not necessarily practical, but it is reasonable. This strategy is to use credit cards to pay for your bills as well as other things that you need. While this might sound reckless, it can be a good method if you know what you are doing and use the right card.

The Right Card?

While you are trying to stay afloat during this economic drift, you need to make sure that you are equipped with the proper tools. This includes your credit card. If you do intend to take advantage of the cash back benefits that some cards offer, you should see what other benefits they have as well. You should also make sure that you understand how their fees and programs are set up.

Take the new Freedom Card from Barclaycard. It can get you tax free cash back bonuses when you use it to purchase products and services from participating retailers. Sometimes, it's the principle that matters.

The AA credit card gets you cash back on the essentials. Instead of paying cash for things like gas, simply use your AA card. This is very similar to cards that are popping up in the US market. You do not need to be a member of the AA in Europe, but if you are a member you can get even more rewards. By comparison, if you look at the Easy Access Maturity account, which is also an AA product, the rates are ridiculously higher with the credit card.

If you travel outside of the UK quite often, you could also consider the Egg Money World MasterCard. You will like it because you get cash back rewards on all standard purchases. There is a small monthly processing fee as well as minimum spending allowance in order to get the benefit, but a quick look at your budget will likely prove that you already spend more than that anyway on things like groceries, commodities, and other everyday things.

Of course, if you travel outside of Europe, and even across the Atlantic, you might want to look at something with a little more global strength. The American Express Platinum Cashback Card is designed for high-profile consumers. They know that as a world traveler, you need a dependable card that rewards you for your consistent use. That is why this card can net you up to five times the cash back rewards that other cards offer.