Key takeaways

  • Credit card hacks are creative strategies users can employ to maximize their card benefits and earn additional rewards and perks, while also saving more money.
  • Canceling a credit card prematurely, using it to pay for prepaid cards and sending electronic payments to friends and family are among the credit card hacks that don't actually work.
  • Applying for and using the credit cards that offer the most generous rewards, rotating your spending across top-earning credit cards and requesting an increase in your credit limit are among the best credit card hacks that are worth a try.

Credit cards come in handy when you need them, making it safer and more convenient to pay for goods and services. Plus, the right cards can earn you generous rewards and bonuses in the form of cash back, airline miles, free hotel stays, statement credits and other perks.

But although some strategies can help you earn greater rewards more quickly, some reward-pursuing tactics can hurt your credit — and even cost you money.

Learn more about these strategies, including the credit card hacks that don’t work, the best practices that are recommended, and the benefits and drawbacks of credit card hacking.

Credit card hacks explained

With inflation and interest rates remaining high, consumers everywhere are taking a closer look at their finances and exploring creative money maneuvers like credit card hacks.

“Credit card hacks are ways to use credit cards to save money and earn rewards, especially in a way that makes users feel like they are beating the system or taking advantage of some secret knowledge,” explains Ted Rossman, senior industry analyst for Bankrate.

Personal finance expert Andrew Lokenauth notes that credit card hacking has become popular in recent years due to the rise in premium travel and cash back cards that offer lucrative ongoing rewards programs.

“Consumers who carry these cards aim to extract maximum value from these programs using clever strategies,” he says.

Americans commonly learn about credit card hacks through online articles, blogs, credit card forums like Reddit and FlyerTalk, social media groups, word-of-mouth referrals from other cardholders and by testing out trial-and-error hacks themselves.

Dennis Shirshikov, head of growth at Awning and an adjunct professor of economics at City University of New York, isn’t surprised that credit card hacks are increasingly popular nowadays.

“Who doesn’t want to squeeze out every last bit of value from their cards, especially in our current economic climate? It’s like finding a $20 bill in your jacket that you haven’t worn since last winter — it feels like a small personal victory,” says Shirshikov.

Pros and cons of credit card hacks

Credit card hacking has its pluses and minuses. Not only can some of these strategies earn significantly more rewards and bonuses for cardholders, but hacking can also enable you to get the most out of the cards you already have by better customizing your usage to fit your spending patterns. Some hacks can help improve your credit score — not to mention give you the satisfying feeling that you’re “beating the system” and getting one over on issuers.

“But while saving money is certainly welcome, some of these strategies fall into gray areas ethically and legally,” Rossman cautions. “Sometimes, they even go over the line. You don’t want to get into trouble with the law or get banned by a credit card company.”

Indeed, certain hacks can result in account closure or forfeiture of the rewards you’ve earned. The wrong hacks can hurt your credit. Additionally, you could end up paying fees or incurring penalties if you make the wrong moves.

“Another risk involved with hacking is the temptation to overspend — which can lead to debt and a potential negative impact on your credit score,” Shirshikov adds.

Credit card hacks to avoid

Given that, it’s important to be careful and steer clear of approaches the experts frown upon. Here are some common credit card hacks that don’t work:

Canceling the card to avoid a fee

Many of the credit cards that offer the best bonuses and incentives charge an annual fee. There’s nothing inherently wrong with charging an annual fee — it can still be worth keeping the card and paying the fee if you continue to use the card responsibly and earn sufficiently valuable rewards to offset it. But a big mistake the pros see consumers make is terminating these cards before that annual fee kicks in.

“This is a definite no-no and one of the fastest ways to get into the penalty box with a card issuer,” warns Rossman. “The issuer could ban you from future offers or even claw back the bonus they gave you. You should keep a card open for at least one year before canceling. Better yet, don’t cancel if the card isn’t working for you; instead, after a year or more is up, request a product change to a different offering from the same issuer.”

Purchasing items to earn rewards but then returning the items

Another sketchy practice is to buy products with your chosen credit card, which garners more points or rewards, and then bring those goods back to the store for a refund, assuming you’ll get to keep those rewards.

“Be forewarned that many credit card issuers typically take back your rewards when you return something, so this likely won’t work. And excessive returns could get you flagged or banned by credit card issuers and the retailers where you purchased the items,” says Rossman.

Buying prepaid cards with your credit card

Let’s say you want to purchase a prepaid credit card that has a set value stored on the card, such as a $25 prepaid VISA. Doing so should, in theory, earn you rewards on the credit card you used to purchase the prepaid card. But not so fast: Many issuers typically don’t give rewards for these items.

“Also, many credit card issuers categorize prepaid card purchases as cash advances, which can incur high fees and interest rates,” says Jeff Rose, a certified financial planner and owner of GoodFinancialCents.com.

Canceling and then reapplying for the same card

Imagine you apply for a card that provides a generous sign-up bonus, use the card long enough to earn that bonus and then cancel your account. Then, you reapply for the same card in the hopes that you’ll get the same sign-on bonus or another valuable incentive. Sounds like easy money, right? Problem is, this scheme likely won’t work; even if you are approved, the credit card company isn’t likely to issue that same reward again.

“Repeatedly opening and closing the same card may result in a declined application or declined bonus incentive as well as a lower credit score. It’s also considered unethical by many issuers,” Rose says.

Pursuing the 15/3 credit card hack

Here’s a ploy that’s been debunked as a waste of time: The 15/3 hack, which supposedly boosts your credit score if you pay half of your credit card payment 15 days before and the other half three days before your account statement deadline date. While there’s generally no harm in doing this, it won’t improve your credit.

Paying your friends and family electronically

It’s easy and simple to send electronic payments via Venmo, PayPal, Apple Pay and other means. But doing so can be more costly in the long run than you think.

“While convenient, sending payments to friends through apps like Venmo can accumulate fees when you use your credit card as the funding source, which ultimately negates any rewards earned,” says Rose.

Recommended credit card hacks

Rest assured there are still plenty of safe, legal and suggested ways to accumulate more credit card rewards without having to worry about fees, penalties or impaired credit. Consider these methods:

Get a credit card with generous rewards

Your best bet? Shop around, compare offers carefully among credit cards that offer rewards and choose the most generous card with no or low fees.

“If you’ve been using the same credit card for a long time, chances are it’s no longer your best option. A Bankrate survey found that 30 percent of cardholders have never switched their primary credit card and another 13 percent haven’t switched in at least a decade. It makes sense to compare card offers every year or so,” advises Rossman.

Just be sure to read the fine print on the card carefully before applying and know what the minimum spend and deadlines are to receive your sign-on bonus (or any subsequent rewards).

Have your spouse apply for the same credit card

If you’re married, nothing is preventing your partner from pursuing the same high-rewards card (assuming the credit card issuer doesn’t prohibit this) and even earning a referral bonus for your ‘player 2’ or ‘P2.’

“Some people in the points and miles world say that is the best thing about being married,” jokes Rossman.

Get multiple credit cards from the same issuer

Pursuing two or more cards from the same credit card issuer can reap significant benefits, including the ability to possibly combine points across cards that you can redeem more quickly.

“A popular example of this is what’s called the ‘Chase trifecta,’ which involves combining a travel card like the Sapphire Reserve or Sapphire Preferred card with a small business card, such as the Ink Business Preferred or Ink Business Unlimited card, and further combining them with what’s normally considered to be more of a cash back card like the Freedom Flex or Freedom Unlimited card,” Rossman explains.

“This can be a symbiotic relationship in which the whole is greater than the sum of its parts. Consider that the points on the traditional cash back cards can be transferred to airline and hotel partners when you also have a transferable points card like the Sapphire Reserve or Sapphire Preferred. That unlocks a lot of potential added value.”

(Editor note: See our Chase Sapphire Reserve® Card, Chase Sapphire Preferred® Card, Chase Freedom Flex℠* and Chase Freedom Unlimited®* reviews for card details.)

Purchase gift cards to rack up more rewards

An easy way to increase your points or cash back is to buy gift cards online or in a brick-and-mortar store.

“Purchasing gift cards at stores you frequently shop at or where you pay for common expenses can quickly rack up rewards,” Shirshikov says. “And if you have a birthday for a friend or relative coming up, this is a nice way to get them a present while also earning some points.”

Just be cautious to limit gift card purchases to your actual needs. Buying excess gift cards just to earn points — also known as ‘manufactured spending’ — can bring extra scrutiny to your account.

Ask for a credit limit increase

Another tried and true hack? Request a higher credit limit from your card’s issuer. With a higher limit, you may be able to run more of your expenses through a rewards-earning card. But it has other benefits as well.

“I like this strategy because it can lower your credit utilization ratio, which improves your credit score. Just make sure you don’t use the higher limit as an excuse to overspend,” suggests Rossman. “But before making the request, do some research or call the card’s customer service number to find out if they will do a hard or soft credit pull. A soft pull doesn’t hurt your credit score, but a hard inquiry will lower it temporarily.”

Spend across your cards that earn the most rewards

If you have multiple cards, put them to best use by rotating your spending across the cards that earn the most rewards. For instance, if you hold the Blue Cash Preferred® Card from American Express, you’ll earn 6 percent cash back on U.S. supermarket purchases (up to $6,000 per year, then 1 percent back). If you spend more than $6,000 per year, you can always redirect your spending to another top credit card for groceries to ensure you maximize your rewards on each purchase.

“This is a very smart strategy. Remember that different cards emphasize different spending categories and reward those categories differently,” Rossman continues.

Pay your bills with your credit card

Here’s another no-brainer: Use your card to pay for as many monthly bills as you’re allowed to. For example, pay medical bills, insurance premiums, subscriptions, and even services, utility fees and taxes (if permitted) on your rewards-earning card. But find out ahead of time if any fees apply, in which case you might want to avoid this practice (unless the benefits outweigh the fees).

“As long as you can pay your credit card balance in full and avoid interest charges, put all of your routine spending on a rewards credit card to get free money in the form of cash back, airline miles or other rewards,” recommends Rossman.

The bottom line

Credit card companies make a lot of money from consumers in the form of interest charges and various fees, which is why issuers can afford to offer cardholders valuable sign-up incentives and ongoing rewards.

Plenty of generous cards are available to apply for and use to your advantage. Just be sure to choose the right card based on your spending habits and use that card responsibly without incurring debt you cannot afford to repay. Ultimately, it’s best to go with the credit card hacks that yield the greatest possible rewards without repercussions.

*The information about the Chase Freedom Flex and Chase Freedom Unlimited has been collected independently by Bankrate. The card details have not been reviewed or approved by the issuer.