The basic idea
- Get 2 credit cards ( lets label them as A,B)
- Using card A, you pay for something
- At the end of the month, use card B to promptly pay for card A.
- At the end of the following month, you will use card A to pay back for card B.
- Repeat 2 and 3 till you decide to pay off the debt by using the cash that you have.
See the potential in this system? ( I am not sure whether banks have a rule on this though)
Lets see how we can make use of this system...
Improving on the idea...
- Say we have 12 credit cards, with $5000 limit on each.
- Hence we are able to have 6 groups of 2 cards each.
- Each group, we will draw out $5000.
- Total we have 6groups X $5000 each = $30,000 at any one time
- Putting this cash into a fixed deposit for a year ( or how ever long you want )
- From the fixed deposit ( at an interest rate of 1.8% per year) you will get $30,000 x 1.8% = $540 per year
Thus in order to maximize your returns, you will have to
- Get more credit cards
- Increase your limit
- Make sure you pay promptly every month!
Any people got any views on this? Please comment..thanks!
Apparently there are flaws in my ideas, as suggested by readers. I shall update on problems and possible improvements this link :