Has anyone ever considered using a 0% Purchase credit card for investing with, I know you would have to be vigilant and have great money management skills, although after recently reading the book "what I didn't learn in school but wished I had" it got me thinking. Why not use the banks money to invest with then pay back the balance before the 0% rate expires and keep the profit. I know if the investment doesn't perform and you lose your money then you still have to pay it back but do you think it is worth the risk? For example purchase Bullion on a 0% Purchase card only pay the minimum 2% monthly repayments required, then sell the asset after 12month period to receive more capital growth and a better tax treatment of the asset. Our be creative with your investment and purchase a large wholesale lot of goods then sell off individually for a better return on investment.
do you consider yourself "strong hands" where you can withstand down trend ? you could be holding the metal for long time...
This is just asking for it. Whatever you invested in would need to be pretty fail-safe.... and as a general rule the safer something is, the less return. One mistake or bad call will leave you with a loss. The upside doesn't warrant the potential downside in my mind.
Yep done it twice now. Borrowed money on a credit card at 1% and stuck it into the home loan, reducing my balance and hence saving 4 to 5% on the interest. Added up to a few hundred dollars savings. Obviously the more they give to you the better. But make sure you pay it all back before the low or no interest offer expires.
This is pretty much the only reason to borrow on a credit card. Buying PM's with it is just too risky... ask those who borrowed tens of thousands when silver was rocketing towards $50... But if your risk appetite is high and you can afford to lose the money, go for it! Dividend giving shares might even be a better choice
Just to clarify, don't credit cards only give you low or no interest on purchases, not cash advances? I thought bullion shops at best took Eftpos and not credit card because of the premium.
The other issue you'll face is actually buying the metals with a credit card. I haven't found anywhere that accepts CC without a fee for purchasing metals.
Bullion dealers like ABC Bullion offer payment via credit card with a 2.2% fee, others allow Paypal credit card payments with 3% fee. Perhaps other dealers reading this thread could state whether they accept credit card payments. Other issues you may face is that cash equivalent transactions such as the purchases of foreign currency isn't allowed, or travelers checks ect, gambling transactions also not allowed. So whether bullion is considered a cash transaction can't see how it would be and couldn't find anything in the product disclosure statement of one particular card. You still get charged 20% or more for cash advances which you would be mad to do, although whats stopping you purchasing bullion selling it then using the proceeds of the sale to invest in shares, term deposit ect, you would lose a little in the selling due to dealers spread just have to work out how long it would take to make that back and how much return on your investment you would get. Link to one particular card http://www.creditcardfinder.com.au/commonwealth-bank-low-rate-credit-card.html
My wife worked for an evil bank/credit card company when she got out of uni. One thing she points out is that credit cards are unsecured debt. They can't come get your stuff you buy. They can ruin your credit score and have collections people call you all day but that's about it. She would often sell cash advances to people (many from middle eastern countries) who would get 10 of thousands of dollars in cash advances. They'd skip the country after they got the money. So maybe get a credit card in some other country and then skip out? Ok maybe not the best of plans.
Had a flatmate leave Australia owing over $40K in credit card debit/personal loans. Taking those calls on his behalf was not fun, but they did eventually stop calling once I advised he had no plans on ever returning from his home country. Not sure if they ever did end up tracking him down... Found it strange that the banks would let him get that far into debit given he was unemployed near the end (and only making ~$15 an hour before that) - it was around 2003 so I guess the credit was flowing easier then it does today...
