Here's How to Maximize Your Value From the Robinhood Gold Card

Robinhood recently announced its first credit card, and while it's not available yet, it's going to be in high demand. The Robinhood Gold Card earns 3% cash back on all categories, which is unheard of. A flat rate of 2% everywhere used to be as good as it gets, so Robinhood is offering an amazing deal.

You need to be a Robinhood Gold member to get the card. A subscription costs $5 per month, and it includes plenty of perks, including a high interest rate on uninvested cash and professional research from Morningstar.

If you're planning to apply for the Robinhood Gold Card when it's available, here are a few tips to help you get the most out of it.

Use it for all your spending (unless you have another card that earns more)

The biggest benefit of the Robinhood Gold Card is that it earns a high cash back rate everywhere you go. So it makes sense to use it everywhere and earn as much cash back as possible. That includes when you travel abroad, as there's no foreign transaction fee.

The only time you shouldn't use this card is when you have other rewards cards that will earn you more. For example, some grocery credit cards earn as much as 6% back at supermarkets. If you have one of those, you'd still be better off using that at the grocery store. But if you're going for a one-card wallet where you use the same card for all your spending, this is easily one of the best credit card options.

Add trusted family members as authorized users

There's no annual fee for the Robinhood Gold Card, and you can also add authorized users free of charge. Cardholders you add can be of any age. If you have children, you could add them to your account so they can start building credit. Not only is this convenient, you'll earn cash back on your authorized user's purchases, too.

Remember that you're responsible for any charges authorized users make. Only add people you trust completely to your credit card, such as your spouse and children. It's definitely not the best idea to add distant relatives or friends just to earn some extra cash back.

Redeem and invest your rewards with Robinhood

Robinhood gives you several ways to redeem your rewards:

• Cash back in your Robinhood brokerage account
• Book travel in the Robinhood Gold Card travel portal
• Make purchases in the shopping portal of the Robinhood Credit Card App
• Purchase gift cards from a variety of merchants through Robinhood's rewards portal

You get the same value for your rewards with any of these, so none of them are bad options. But because this card makes it easy and convenient to invest your rewards, it's wise to take advantage.

If you redeem your rewards as cash back in your Robinhood account, you can then invest them in anything Robinhood offers, including individual stocks and exchange-traded funds (ETFs). Over time, this could significantly boost how much you're able to invest.

Let's say you spend $30,000 per year on your Robinhood Gold Card. That's $900 cash back you could invest. If you do that for 30 years and get an 8% annual return, it would add $110,111 to your portfolio.

Always pay your Robinhood credit card in full

The most important thing to remember with this and other credit cards is that they're only a good deal when you pay in full. If you carry a balance, then you can be charged interest. Those interest charges will most likely outweigh all the cash back you've earned.

To stay out of credit card debt, only use your card for purchases you can afford. Pay the full balance every month, and you'll be earning cash back without any interest charges.

The Robinhood Gold Card is expected to be available later this year. If you're interested, you can join the waitlist on the card page -- all you need to do is provide your email address. Once you get it, use it for your regular bills, invest your rewards, and pay in full. If you do that, you're sure to get quite a bit of value from it.