Just by switching your bank account or the way you shop can pocket you some serious cashback!
Everyone likes to get money for nothing. And there are a number of ways you can do just that in the form of cashback.
Cashback from your current account
You can get cashback from your current account in a couple of different ways. You could get it just for opening the account, such as from First Direct which pays you £100 just for opening its 1st Account.
You can get it based on how much you pay in each month, irrespective of your final balance, such as with Halifax which pays £5 a month so long as you pay £1,000 in with its Reward current account. (This Halifax account also pays £100 when you switch.)
However, the most lucrative way is to earn cashback on the direct debits you pay each month. And the only account that does that is the 123 current account from Santander.
It pays 1% on water, Council Tax and Santander mortgage payments, 2% on gas and electricity bills and 3% on mobile, home phone, broadband and paid for TV packages.
Let's imagine you make the following monthly payments:
Mortgage: £700
Council Tax: £100
Water: £35
Gas and Electricity: £100
Phone/broadband/pay TV: £50
If you paid all these bills with the Santander 123 account, you'd get £11.85 in cashback.
What's more, the account also pays up to 3% interest on your credit balances.
However, you will need to pay in £500 a month and pay a monthly £2 fee though for the 123 account.
Cashback websites
The slightest tweak to your shopping habits can get big results.
Before you shop online, go to your cashback website of choice and see if it has a deal on offer with the retailer you’re planning to shop with. If so, visit the retailer via the tracked link and you’ll receive a percentage of your spend back in cashback.
For example, I’m about to book my summer holiday – four days in a caravan on a holiday park (I know you’re all jealous). If I book with Park Resorts via Quidco I can get 5% cashback, while if I booked via TopCashback I’d get 5.05% cashback.
[SPOTLIGHT]Quidco and TopCashback are the two biggest players in the cashback market and have both recently introduced the chance to earn cashback on your grocery shopping. Check out Quidco's ClickSnap supermarket shopping tool reviewed and Top Cashback's Snap & Save supermarket shopping tool reviewed.
Use a cashback credit card
Modifying how you shop is one way to pocket cashback on your spending. Adjusting how you pay for it is another way.
Cashback credit cards will reward you with a percentage of your spend back in cashback. There are a number of different ones and they all work in slightly different ways.
For example, there’s the American Express Platinum cashback card, which pays 5% on all your spending in the first three months, up to a maximum of £100. After that you’ll earn 1.25% on all of your spending, though this doubles to 2.5% in your anniversary month with the card. You’ll have to pay an annual fee of £25 though.
Then there’s the Santander 123 cashback credit card. The rate of cashback you earn depends on where you spend your money. So you get 1% on your spending at supermarkets, 2% on money spent at department stores, and 3% on money spent on petrol or train travel.
You will have to pay a £24 annual fee, though this doesn’t apply for the first year if you also have the Santander 123 current account.
Another card worth a look is the Barclaycard High 5 Cashback Visa. It pays 6% cashback in the first three months, capped at £120. After that there’s 2% cashback on your five biggest monthly purchases, and 0.5% thereafter. In your anniversary month the rate on your five top purchases jumps to 4%. Once again there’s an annual fee though, of £24.
For a full run-down of the different cashback credit cards, check out The best cashback credit cards
This article has been updated.