Did you know that you can use your Credit Cards to put Money in your pocket instead of draining money from it? This might seem like it is too good to be true but this is what many people are doing. The good news is you can do it too.

What’s the secret? No, this post is not hawking some ‘secret’ e-book that will show you how to convert your credit cards into money making and money generating cards.

Instead, we just want to highlight the fact that your credit card is an instrument you can use to buy stuff that takes cash out of your pockets or stuff that puts money back in. In other words, you can use your credit cards to buy liabilities, or you can use it to buy assets.

Assets put money in your pockets. Liabilities drain cash from your pocket. It truly is that simple. You have a wide range of choices on what assets to buy and what to buy. Use the following tips so you can have a clear idea of how to go about buying assets.

Factor in your credit cards’ interest rate when you are buying assets

If you are buying an asset like website hosting annual package that you can resell, you have to keep in mind that you might be paying a high interest rate that might either eat into your profit margins or destroy your profits outright. Always pay attention to the cost of the money you are borrowing. This is a key element in making sure the asset you are buying produces enough money, after costs are deducted, to justify the purchase of the asset.

Ideally, you should buy an asset that generates more money than other assets at a similar price point. In other words, make sure you consider opportunity costs. It takes money to buy an asset so make sure you compare different assets so you are assured of having an asset that produces the most amount of money.

Factor in the amount of lead time for your asset to generate cash

Not all assets generate money when you buy them. Some have a dormant stage where the asset ‘ramps up’ to a point where it starts generating cash. This especially true for online properties or online services. There are many websites being sold online that do generate money-after some time.

Many asset seekers buy this type of virtual income-generating property because they are cheaper than sites that actually have a current robust cash flow. Obviously, you are betting that the ramp up period does pan out and the site actually starts generating real, albeit low at first, money.

Don’t gamble

You would be surprised at how many people get excited by the fact that they can use their credit cards to buy assets. They go hog wild and start buying all sorts of things that are hyped up as ‘assets’. The truth is, unless you are aware of how fast the item you are buying can generate money, you are gambling. There is an acceptable level of risk and there are outright gambles.

If you hope to make enough cash to pay off your credit card statement, it is crucial that you fight off the impulse to gamble and make informed and calculated risks instead. This is the crucial difference between smart buying and outright gambling. If you are just going to gamble, you might as well play online poker. At least with poker, there is still some element of skill and talent involved and you might make money. The same can’t be said of highly speculating online ‘assets.’