Saturday, March 14, 2015

Credit Card - Spend Earlier or Later?

Hi Everyone!

I have been thinking about how to maximize my savings through credit cards. As many people might think that credit card is just an liability rather than a way to maximize your money. Do not that I am thinking from the point of view of earning interest from OCBC 360. Because if we look at how OCBC 360 calculate interest, they count by daily average, which means they will do this calculation 

(add all the balance for all 30 days / 30 days) to get the average. Simple Math!

So I was thinking how can I make use of this to maximize my interest rate. Thinking of spending earlier or spending later, that is the key to this idea that I have in mind. If you manage to follow my first few post on this blog, you should have know what technique that I have been using to spend the $400 that is required for OCBC 360 requirement -

So now the problem is spend earlier or later of the month? My answer is earlier of the month, the reason is because lets say if you use the method that I have mentioned, and you receive cash from your friends lets say $300, you can save that money to your OCBC 360 on maybe the 5th of April. This will increase your daily average by 200++ dollar for that particular month. Lets say it increase by $250 by using this method, you can earn extra 62.5 cents for that month. If lets say you can manage to increase the daily average by $500 you will have $1.45 more for that month. That does not not mean you are encourage to spend the credit card on your own but to get the money out of it by pay your friend's meal with your credit card and make them pay you cash. 

On top of that, you can still earn rebates if you spend more! Despite of maximizing out your OCBC 360 account, you can put that amount of money to your other savings account to earn more interest for that month. Certainly, you will have to pay for your credit card bill, but remember, the money that you earn are the interest that you have gained!

Do note that this post does not encourage people to any how spend their credit card on buying their own things but to use creative way to save and earn interest :D good luck!

And also pay your credit card bill on time to prevent any interest being charged as this will create a negative to your saving account


  1. Hi James

    Does it mean after spending $400 to meet the requirement, we should not charge further to the account because there are no "other" benefits such as rebates or points to the credit cards?

  2. $400 is to meet the target for the OCBC 360 requirement for gaining that 1% interest. There are other rebates for credit card depending on which one you get. For frank, you will get 0.5% unlimited rebate for the amount you spend using the frank card.

    For other ocbc credit card you can check out their rebate structure. But the bottom line is to hit the $400 benchmark to gain that 1% interest, that's the most important part. But if this is out of your capability (which I dont think so), you can still get the other 2% bonus