Many crypto users have no clue that they can earn crypto while spending crypto – and beyond that – they have no clue they can use those earnings to pay down credit interest.
On that note, here’s a comprehensive look at how crypto enthusiasts, and crypto beginners alike can take advantage of crypto cash-back rewards.
First, how does credit interest work?
Many credit card users do not understand that credit card companies charge interest in various ways and at various levels for various people (depending on the company policy and customer credit score). For example, while the interest rate for purchases might be 12%, the interest rate for cash advances might be 10%, depending on which card provider you have.
Therefore, you should be thorough when choosing a credit card provider; make sure you pick one with interest rates that are favorable to you. It is also worth noting that your credit score changes, meaning you can change your interest rates if you have been prompt on payments.
However, in most cases, you can escape these extra charges if you pay your debts by the end of the month; credit cards only make you pay for the service of borrowing money.
But here’s the thing; many people cannot pay their debts completely when the time comes, leaving you with extra interest to pay on top of the money owed.
What do crypto cash-backs have to do with this?
Cash-backs are not a new term in our capitalist forest. For example, if you have a 10% cash-back rate on your expenses in a cash-back promo, you could spend $5,000 and get $500 back on your expenditure.
Basically, it’s spending money to get money back. Cash-backs allow you to go about buying something you want while saving money from this expense.
Still using our above example, if you get $500 cash-back, you could use this new prize money to get a new phone. Or you could use it to pay back the interest on your card. Or you could get it as crypto–then use it to pay down credit interest.
Why would I want to receive my cash-back as crypto?
Well, the crypto market in general has been on a steady uptrend over the past few years, so much so that Bitcoin has risen at least five times in value since 2020. Now, if you had received your cash-back as bitcoin crypto in 2020, then in 2022, you would be able to pay your credit interest five times easier.
Crypto cash-back offers you a way to passively earn cryptocurrency (which is on a generally upward trend) while going about your normal business and absolving you of the risk of investing.
Are there services out there that can really do this?
Crypto cash-back services might be a bit difficult to find, but it does exist. Crypto debit and credit cards like Coinbase Visa, BlockFi, and Gemini credit cards offer people a way to spend their crypto through crypto-wallets. However, there are some fintechs with credit cards that offer cash back rewards such as credit cards from SoFi, which offers customers fixed-rate cash-back on all purchases.
Credit card interest can be bothersome, especially when it racks up beyond control. And unfortunately, missed interest payments may mean compound interest. But you can beat it back with the right investments.
With crypto gradually rising in value, getting a crypto reward cash-back card that allows you to put your crypto earnings into beating your interest could help keep you one step ahead of your credit interest.