How to Make Easy Money Selling Tradelines

December 18, 2021CreditBy toptierfinancial

Selling tradelines has been written about on several reputable websites referring to it as a “$1,000 per hour side gig,” but is this true?

Technically, the answer is yes, but let us explain further. Keep reading this article to find out how to make money selling tradelines.

The Authorized User Tradeline Strategy

Do you remember hearing this old advice? “When your kids become young adults, add them to your credit cards as an authorized user to give them a head start on their credit.”

This credit-building strategy actually works, and now there is a way to get paid by doing the same thing for other people looking to build their credit profiles. Keep reading to find out how this works and why some people are earning thousands of dollars by selling their authorized user (AU) tradelines.

Is Selling Tradelines Really a $1,000 per Hour Side Gig?
Earn money in minutes by selling authorized user tradelines on your credit cards.

You can earn money in minutes by selling authorized user tradelines on your credit cards.

At Tradeline Supply Company, LLC, commissions generally range from around $50 – $350 per AU spot sold. The older the credit card is and the higher the credit limit, the higher the commission will be.

The AUs only stay on the tradeline for two months in most cases, so there is relatively frequent turnover. On average, we usually allow our credit partners to sell two AU spots per credit card every two months.

The reason this works out to a four-digit hourly wage is really due to how little time it takes to work this gig.

Once you get familiar with adding and removing AUs from your accounts, you might be able to add someone in one minute and remove someone in 30 seconds since that often only requires a click of a mouse. A couple of banks allow you to add an AU online and then require you to call them to get the AU removed.

This said, let’s just assume on average adding an AU takes two minutes and removing an AU takes two minutes. An average commission is around $150 per spot. If you do the math, earning $150 in four minutes of work comes out to an hourly wage of approximately $2,250 per hour. On the higher end of the commission range, a $350 commission works out to be approximately $5,250 per hour based on time worked.

Watch your profits grow as you sell tradelines.

Obviously, the $1,000 per hour rate is not a true measure of how much you can expect to earn. A $1,000 per hour full-time job would earn someone over $2 million per year.

We are not saying you can make that much money, but if you calculate how much money you earn versus time spent, the numbers are in fact very impressive.

Perhaps a more realistic way to assess this opportunity is to look at how much time would be required to earn $10,000 selling tradelines in a year.

The people who earn over $10,000 per year usually have higher-paying cards, so their average commission would be closer to $250 per spot. To make $10,000, this person would have to sell 40 spots per year. With an average of four minutes of work per deal, this person would have spent approximately 2.67 hours of work to earn $10,000, which works out to around $3,750 per hour.

Are There Risks to Selling Tradelines?

Although the authorized user never receives any information about the credit partner, you can always add additional security measures to your account for peace of mind. Photo by Blue Coat.

Yes, there are some risks to selling tradelines. The main risk is the possibility of getting your credit card shut down. We estimate a 1-5% chance of getting your card closed depending on the bank and the number of authorized user (AU) spots you sell during a given period of time.

The good news is that you have control over how many AU spots you sell. If you have been consistently selling your AU spots out every cycle, you can always choose to pause your account between sales and give your cards a rest.

The key here is to avoid adding and removing too many AUs too quickly. You want your accounts to stay open so that you can stay in this game for the long haul.

The most common questions that most people immediately ask are “Is this even legal?”, “Can this affect my credit?”, and “What if the authorized user spends a bunch of money on my card?” The answers are yes, selling tradelines is legal; no, the authorized user will not affect the credit partner’s credit; and no, the authorized user cannot spend any money on your account.

The credit card companies will only send the AU card to the primary account holder’s address and the AU does not receive any information about the credit partner or their account whatsoever. Additionally, most banks offer extra security features such as account activity alerts, instant account freezes, and multi-factor authentication.

Why Isn’t Everyone Selling Tradelines?

How to Make Easy Money Selling Tradelines Pinterest graphic

The business of selling tradelines has remained sort of “underground” for many years. The knowledge of this option has largely relied on word of mouth through certain niche personal finance communities.

It takes a very unique type of individual who has built great credit, has multiple excellent lines of credit, and is willing to share that credit for money. This trifecta of qualities is extremely rare, so it does not make financial sense to broadcast this opportunity to the general public when the target demographic is so small.

This unique dynamic might explain why you may not have heard about this kind of financial opportunity until now.

How Do I Get Started Selling My Tradelines?

Getting started selling tradelines is easy. Just visit our website and enter your information into the box to instantly receive our current commission schedule and instructions with the next steps.

If you would like to do further research on selling tradelines, can read our article, “Selling Tradelines: How to Choose the Best Tradeline Company” and our Credit Partner FAQs.

To speak with a live person from our team regarding our credit partner program, feel free to give us a call at 888-844-8910.

Debit vs. Credit Cards: Which Is the Better Way to Pay? – Credit Countdown With Credit Expert John Ulzheimer

June 26, 2021CreditBy toptierfinancial

Debit Cards vs. Credit Cards - Pinterest When you are paying for purchases, is it better to use a debit card or a credit card?

The answer depends on which features and advantages are important to you. In a Credit Countdown video, credit expert John Ulzheimer compares the pros and cons of credit cards and debit cards in regards to several different metrics, such as fraud protection and credit-building ability.

Read the article about this subject below and then catch the Credit Countdown video at the bottom of the page or on our YouTube channel.

The Basics: How Debit Cards and Credit Cards Work

Credit cards and debit cards may look very similar and feel similar when you make a purchase, but the two payment methods work completely differently.

A debit card is linked to your checking account. When you pay for something using a debit card, the money you spent is being debited directly from your bank account. In other words, you are using your own money to pay for the item immediately.

A credit card is, of course, a form of credit, meaning that you are borrowing someone else’s money. In this case, the credit card issuer is your lender. When you swipe a credit card, you are essentially borrowing money from the bank to pay for the purchase with the agreement that you will pay back the debt, plus any applicable interest charges and fees, later.

Credit cards are revolving credit accounts, which means you have the option to carry a balance from month to month while making only the required minimum payments instead of paying the full balance when you get the bill.

Fraud Protection

If a fraudster gets ahold of your card, which type offers better protection?

With a debit card, fraudulent purchases have already deducted the funds from your checking account, and it may be difficult to get your money back.

If your credit card is stolen, it’s the bank’s money that is directly at risk, not yours. Beyond that, credit cards generally have excellent fraud protection policies.

The Fair Credit Billing Act (FCBA) mandates that you, as a consumer, can only be held liable for a maximum of $50 in the event of credit card fraud. Even better, the major credit card networks all offer $0 fraud liability policies, which means nothing has to come out of your pocket if your credit card is used fraudulently.

Credit cards provide strong fraud protection policies to limit your liability if your credit card information gets stolen.

Credit Building

There’s no comparison when it comes to credit building: only credit cards can help you build a credit history. The credit card issuer reports your activity to the credit bureaus, allowing you to accumulate credit age and on-time payment history if you manage the account properly.

The credit limit of your credit card also contributes to your revolving utilization, which may help your credit score as long as there is not a high balance on the account.

Obviously, debit cards are not a form of credit because you are not borrowing money. Therefore, you do not make payments to a lender and so your activity is not reported to the credit bureaus. For this reason, debit cards do not show up on your credit reports and cannot help you build credit.

Spending Capacity (Buying Power)

The buying power of a debit card is limited by how much money you keep in your bank account. It’s not necessarily a good idea to keep a lot of money in your checking account, where it is likely earning very little interest compared to what you could earn by investing the funds elsewhere.

Credit cards, on the other hand, typically provide more buying power because you are only limited by the credit limit set by the credit card issuer, which may be quite generous if you have a decent credit score. Since you do not need to pay off the balance immediately, you do not have to worry about maintaining a large stash of cash in your bank account.

To boost your credit card spending capacity even more, try some of the tips in our article on increasing your credit limit.

Usability

Certain transactions require you to use a credit card or are much easier to complete with a credit card.

This includes many activities related to traveling, such as renting a car or paying for a hotel room. In addition, such businesses may place a temporary “hold” on your account, which is not as much of an issue when you have available credit on your credit card compared to having a hold placed on your checking account, which could cause other transactions to be declined.

Budgetary Control

This is the category where debit cards excel. If you struggle to control your spending and stay within a budget, it’s actually a good thing to have less buying power and no access to credit.

Credit cards, if used correctly, don’t require you to get into credit card debt in order to get the advantages of using a credit card. However, the higher spending limit and the ability to carry a balance can be powerful temptations to buy more than you can afford to pay off.

Summary

So, which payment method wins in your opinion? Use the table below to decide.

Debit Cards
Credit Cards

Source
Your bank account
The credit card issuer

Fraud Protection
Limited
Strong

Credit-building Ability
No
Yes

Buying Power
Limited to the balance of your bank account
Limited by your credit limit

Usability
Limited in some situations
Widely accepted

Budgetary Control
Yes
No

Check out the Credit Countdown video with John Ulzheimer on our YouTube channel for more information about credit cards vs. debit cards!

Snowball vs. Avalanche: What Is the Best Way to Pay Off Debt?

January 13, 2021CreditBy toptierfinancial

Snowball vs. Avalanche: What Is the Best Way to Pay Off Debt? - Pinterest graphic If you’re like most Americans, you probably have more debt than you would like to have. Almost 60% of Americans say they feel “weighed down” by debt, according to a survey by LendingTree. It’s no surprise that a majority of consumers share this sentiment considering that the Federal Reserve Board (FRB) says that Americans collectively owe a total of over four trillion dollars in debt as of August 2020 (that’s $4,123,499,210,000, to be precise).

Between mortgage loans, auto loans, student loans, home equity lines of credit, credit cards, personal loans, and more, Business Insider reports that the average American has $51,900 in debt.

Naturally, many people want to pay off their debt as quickly as possible. Once you are done making those hefty monthly payments, you can use your money to work for you instead of sending it out the door to your lenders.

If paying off debt is one of your financial goals, then this article is for you. We’ll be breaking down two of the most popular and effective ways of paying off debt: the debt snowball and the debt avalanche.

The Debt Snowball Method

The “debt snowball” strategy was popularized by Dave Ramsey and it is perhaps the most well-known technique for paying down debt.

How the Debt Snowball Works

The process of the debt snowball method is relatively simple. Here’s how it works:

Keep making the minimum payments on all of your debts.
Take a look at your budget and see if you can free up some funds by cutting spending or increasing your income.
Send as much money as you can toward your smallest debt until you have completely finished paying off that debt.
Once you have paid off your smallest debt, direct the money that was previously assigned to paying off that account to the next smallest account.
Repeat this process for each of your accounts in order of lowest to highest balances until you have no more debt!

Pros of the Debt Snowball Method

The debt snowball plan is not necessarily the most economically efficient, as we will discuss below, but there is a reason why it is still one of the most popular ways to gradually pay off debt.

The “debt snowball” strategy is the most popular and statistically the most successful method for paying down debt.

The “debt snowball” strategy is the most popular and statistically the most successful method for paying off debt.

You get to enjoy the satisfaction of “small wins” as you pay off your lowest balances.

The effectiveness of the debt snowball approach lies in behavioral psychology rather than mathematical calculations.

When you use your resources to tackle your least intimidating debt first, it won’t be long before you can celebrate a small victory, and then another, and then another. This provides encouragement and motivation to keep going, which is a vital factor in the long-term sustainability of your plan.

You can quickly make progress on freeing up cash flow to direct toward other debts.

Every time you knock out a small debt, you can use the money that you were putting toward that bill to attack the next one, increasing your momentum with each debt that you finish paying off.

The debt snowball has the highest success rate.

Many financial experts recommend the debt snowball option because statistically, consumers are more likely to stay on track with their goals when they use the snowball approach, which is due to its powerful psychologically motivating effect.

Cons of the Debt Snowball Method

You will pay more in interest charges.

With the debt snowball option, since you are attacking your debts in order of their outstanding balances without considering their interest rates, it is likely that you will end up paying more in interest than if you were to work in order of the debt with the highest interest rate first to the debt with the lowest interest rate last.

It will likely take longer to pay off your debt.

Similarly, since you will be starting small and paying more money in interest overall, it could take longer to become debt-free than if you were to use a mathematically more efficient method.

The Debt Avalanche Method
The debt avalanche method is technically the faster and more economical approach to getting rid of your debt.

The debt avalanche method is technically the faster and more economical approach to getting rid of your debt.

The debt avalanche, on the other hand, is all about the numbers. This path aims to reduce the amount of interest you pay so that you can pay off your debt faster and pay less money overall.

How The Debt Avalanche Works

The debt avalanche is very similar to the snowball strategy. The only difference is the order in which you pay off each debt. The process follows these steps:

Keep making the minimum payments on all of your debts.
Send as much money as you can toward the account that has the highest interest rate.
Keep doing this until the account is paid off.
Take the money that was going toward that account and add it to your monthly payment toward the account with the second-highest interest rate until you eliminate the balance on that debt.
Repeat this process until your debt is gone!

Pros of the Debt Avalanche Method
Without the psychological motivation of “small wins” at the beginning, the debt avalanche plan tends to be less effective because it is harder to stick to than the snowball method.

Without the psychological motivation of “small wins” at the beginning, the debt avalanche plan tends to be less effective because it is harder to stick to than the snowball method.

You will pay less in interest.

Since you are tackling the debts with the highest interest rates first, you will be able to wipe out the most expensive debt more quickly than if you were to prioritize the size of the balance instead.

The debt avalanche helps you get rid of your debt sooner.

Again, starting with the highest interest rates means you won’t have to deal with those high interest charges continually piling on as you pay off other accounts. Less interest means a lower total amount owed, so you could reach your goal faster with this method.

Cons of the Debt Avalanche Method

It might take a while to feel like you are making progress.

With the debt avalanche, you may not be starting with a small debt, so you might not get the chance to celebrate some small wins early on that you could get with the snowball approach. This is especially true if your higher interest rate debts are also your accounts with high balances. It could take a long time to finish paying off just one account.

It doesn’t account for emotions about money and debt.

While the debt snowball is meant to keep you going by providing quick emotional boosts, the debt avalanche focuses purely on the numbers. Calculations of how much you could save on interest may not be as exciting or motivating as the prospect of knocking out smaller accounts.

The fact that people tend to have strong feelings about money is not necessarily accounted for in the debt avalanche plan.

The debt avalanche is harder to stick to long-term.

Due to the above factors, the debt avalanche method can feel discouraging to some consumers. If it’s hard to see the dent you are making in your debt, you are more likely to give up on your goals and land right back where you started. As we mentioned above, the debt snowball tends to have a higher success rate than the debt avalanche.

Snowball vs. Avalanche Debt Payoff Calculator

Perhaps by this point, it is still not clear which of these two methods would work best for you. One tool that may be useful in making your decision is a calculator that can show you how much you will pay back in total and how long it will take you to get out of debt with both methods so that you can compare the results side by side.

To use a snowball vs. avalanche calculator, such as this one from MagnifyMoney, you will need to have the following information on hand to put into the calculator:

A debt snowball vs. avalanche calculator can help you determine the best approach for you.

The balance of each of your accounts
The APR of each account
The amount of the minimum monthly payment you make toward each account
The total dollar amount that you can afford to pay toward your debt every month

Once you input your information and get your results from the calculator, you will have a clearer comparison of the two methods in numerical terms.

A Hybrid Approach

A third option is to use a combination of the two strategies to get the benefits of each.

For example, you could first focus on accounts with significantly higher interest rates than your other accounts, such as credit cards, like you would with the avalanche method.

Then, once you are finished with those, you could proceed to pay off the rest of your accounts with lower interest rates in order of smallest to largest outstanding balances. Since these accounts will all have relatively low interest rates, this way, you can still hit some of those smaller goals without sacrificing too much money in terms of interest.

Another potential benefit to this approach is that focusing on paying off your credit cards first can help your credit score rebound sooner, since revolving debt balances are far more damaging to your credit score than installment debt balances.

Summary: What Is the Best Way to Pay Off Debt?

When it comes to paying off debt, there is no easy, one size fits all answer. The best path forward depends not just on the nuts and bolts of your finances, but also your personality, behaviors, and motivations.

The debt snowball is a popular option that works well for many because the quick feeling of success each time you pay off a small debt can help keep you inspired to stay on track. The downside of this method is that you could pay more in interest and spend a longer period of time chipping away at your debt.

If you would rather minimize interest charges and speed up the process, and you don’t need those psychological boosts, then the avalanche method may work for you. However, keep in mind that not everyone has the discipline to stick with the debt avalanche for as long as it takes to see results.

You can also get creative and modify or combine the two approaches in a way that makes sense for your financial situation and your personality.

In addition, your debt payoff plan—no matter which method you choose—will only help you if you commit to getting and staying out of debt. If you are still spending too much and accumulating more debt, then you won’t get anywhere, even with the most powerful debt payoff strategies.

Ultimately, the best way to pay off debt is to choose a plan that you can stick to. The most important thing is to be able to reach your destination of becoming debt-free, regardless of which path you choose.

How to Make Easy Money Selling Tradelines

Debit vs. Credit Cards: Which Is the Better Way to Pay? – Credit Countdown With Credit Expert John Ulzheimer

Snowball vs. Avalanche: What Is the Best Way to Pay Off Debt?

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