Entries Tagged as 'Cash Back'

How To Use Credit Cards To Your Advantage

If you’re a savvy shopper you know that you can save a great deal of money watching for sales and taking advantage of lost leaders.

It’s your money, so you might as well save as much of it as you can; not like some ones just handing it out to you without hard work.

One of the easiest ways to make your money go further is to take advantage of special offers from credit card companies that pay you money back to use their cards.  Most of the programs are complicated, and maximizing your benefits takes a little bit of discipline, but you can end up with quite a bit of money back every year.

The cards I recommend (in order) are:

  • Citibank Rewards Dividend Platinum Card (Master Card)
  • Chase Freedom (VISA)
  • Citibank Cash Returns (Master Card)

I recommend you get all three of them, and here’s why.

There are limits on the Citi Rewards and Chase Freedom cards, but if you use them right you can get 3% cash back, and with the Chase card as much as 5%!  But if you use your card a great deal you’ll cap it out before the end of the year.

The Citi Cash Returns Card doesn’t have a cap, but only pays 1% (1.2% for the first year).

I believe all Citi cards also provide you with virtual account numbers, which give you control of who can change what to your card when.  Chase unfortunately does not offer virtual cards numbers.  If you must have a VISA with virtual account numbers, Bank of America has several cards with decent rewards programs (more like the Citi Premier Pass Card utilizing the “Thank-You Network”).

There are of course many other cards that you might be able to save money with.

For instance I have a Chase Amazon (VISA) Card, mainly because they gave me $30 off my first purchase (since then they’ve given me $20 for $100 in charges, and $30 for $100 in charges to encourage me to use the card; but since I don’t purchase from Amazon much, it really isn’t that great a card for me).

The other way to make a credit card work for you is use it any time a merchant accepts it; they’ve built it into their pricing, so you might as well get 1-3% cash back for using your card; of course you do need to make sure you pay your bill in full before the due date every month, or those “savings” will quickly disappear with the interest charges!

On other word of advice, don’t acquire a huge number of credit cards; it will adversely effect your credit rating even if you don’t use them or carry a balance.  The immediate hit of lots of credit inquiries will make it harder to get credit, and having a large number of open accounts trims down your score as well.  And honestly, you don’t really need lots of cards, companies like Citi and Chase will provide you with INSANE credit limits.

Originally posted 2008-05-16 21:28:07.

Credit Card Game

So you’re looking to add another credit card to your wallet… here’s a few options and things to consider ad you play the credit card game and get the financial institutions to pay you.

Discover — promo offer, spend $500 and get $50 cash back; but you’ll only get 0.25% cash back in the first tier (but they do have on going special categories, and the cash back percentage goes up as you spend more; but certainly their are better options).

Walmart Discover — promo offer will give you $20 cash back if you spend $100 on it the day you apply at a Walmart store (you get a check with your first statement).  Keep in mind that the Walmart Discover isn’t actually issued by Discover Financial Service, but rather by GE Money Bank (so it has to be managed through the Walmart portal, not Discover; and it doesn’t have many of the features of a regular Discover card).

NOTE: Discover branded card allow you to get cash back at a Walmart or Sam’s Club (which is charged as a purchase, not cash advance).

Citi Diamond Preferred MC (or AMEX) — promo “5% bonus” on gas, drugstores, and supermarkets for the first year; if you spend $300 in the first three months you get a $50 gift card; 1% normally — virtual credit card numbers

Citi Dividend MC — “bonus” categories change; 1% minimum ($300 max rebate per year) — virtual credit card numbers.

Chase Freedom VISA — promo 5% on gas and travel right now, the “bonus” categories change; 1% minimum.

CapitalOne Platinum VISA — 2% on gas and groceries, 1% minimum — low rent bank; but pay your bills and you will be fine.

Costco AMEX — 3% gas and dining; 2% travel, 1% minimum (requires paid Costco membership; $3000 purchase limit on 3% gas, 1% afterwards).

Most all the cash back cards now don’t offer good cash back rates for long (you have to play the promo game)… one way to avoid that is get a “branded” card at a place you do lots of business (like if you bought Shell gas most of the time get the Shell VISA — but it only works if there’s a card from place you do a lot of business and it pays say 5% there and 1% elsewhere; Chase has lots of those types of cards).

My feeling is the right number of credit cards is THREE

  • VISA
  • Master Card
  • Discover

You can argue four if you like AMEX — and that would probably be either the Costco or Citi AMEX for the best deal.

I would say acquire a credit card no more often than every three months until you’re at the level you want… if you find a card you like better than one you have — acquire it and just don’t use the other card (you can close it as well, but that really doesn’t buy you anything). DO NOT apply for more than a single credit card per month; and be careful about opening a bank account AND applying for a credit card in the same thirty day window (do the credit card first).

NOTE: Use credit cards responsibly.  If you can’t afford to pay the balance off every month — don’t make the purchase.  While many people keep revolving balances on credit cards, the interest rate (even a good interest rate for a credit card) makes the cost of what you’re purchasing ridiculous.  If you feel you won’t use a credit card responsibly — look for a financial institution that offers rewards on their debit card.

If I were applying for a new card right now it would probably be the Citi Diamond Preferred; and I’m considering applying for a Citi Diamond once the Chase 5% gas deal is over.

NOTE: I have a Discover, Walmart Discover, Citi Dividend, and Chase Freedom (along with others that I have not included on the this list).  I do not have (nor do I want) any AMEX card; nor do I personally want to do business with CapitolOne.

Originally posted 2010-07-23 02:00:19.

Protecting Your Rewards

Many financial institutions that issue “cash back” or “rewards” debit cards and credit cards are in poor financial shape at the moment.

As a precaution you may want to cash in your points now in order to insure that the institutions don’t make a change to the program that greatly diminishes your value.  In addition you might want to find another financial institution that isn’t in precarious financial condition with a rewards program to use in the interim until your current institution stabilizes.

The two largest banking institutions that have liberal rewards programs that are in financial trouble are Citi Group and Bank of America.

The largest banking institution that has a liberal rewards program that isn’t in financial trouble is Chase.

Originally posted 2009-01-29 01:00:04.

Working the Chase / Amazon VISA

Right now Amazon has a promotion going that they’ll give you a 5% bonus for gift card purchases with an Amazon VISA card… so that ends up being 8% total (since you normally get 3%).

In fact, you might want to consider Amazon gift cards for routine purchases — particularly when you’re buying from an Amazon merchant…

Why?

Well, the Chase /Amazon VISA give you 3% cash back when you purchase items from Amazon; but only 1% when you purchase elsewhere (including Amazon merchants); so to get around this, buy a gift card for the exact amount you’re amount to spend at a merchant (just go ahead and get to the check out screen asking for payment — you can add a gift card there); then open another browser windows and purchase a gift card (for electronic/email) delivery for the exact amount… then apply the gift card number at the checkout and you’re done.

The first time you send a gift card to an email address you’ll have to re-enter your Amazon VISA credit card number (for security), and it seems like it always takes longer than it should to send the email — alternately you can select the option to print a gift card and simply take the gift card coupon number from that.

The 5% bonus program only lasts until the end of this month, and it’s limited to $2000 purchase / $100 bonus — but even after that expires you can still use the gift card purchase trick to get your 3% on your Amazon VISA.

One caveat — if you return an item, you’re going to get a gift card credit; that’s not a big deal of you’re a frequent Amazon shopper (the check out will always apply gift cards by default).

There is no reason to use a gift card for an Amazon purchase after the 5% bonus program is over (or you max out your bonus).

It’s free money… and doesn’t require much extra work to get it.

Maximizing Cash Back

Many credit cards offer cash back awards (or other awards) just for using the cards.

You should familiarize yourself with each card’s bonus cash back, and try and use the card that pays you the most back (yes, consider the closing date and how long you will get the use of the credit card company’s money as well, but at the moment you can’t really get much interest back on your money, so the only real concern there should be cash flow).

Many credit card companies also offer bonus points if you use the shopping links on their web site (generally you have to sign into their online account management, and often you have to explicitly register you card).

Some credit card companies require you to always launch the shopping experience through their web site, others will recognize the merchant once you’ve registered the card — and may of those will also pay you bonus cash back at brick-and-mortar stores once you’ve registered your card.

The bottom line is, you have to read and understand each card’s reward program, and you have to be diligent in exercising the program.

So how much cash back did I get last year?  $1981 — and no,  most of that was not at 1% back; over half of it was at 3% and much of it was at 4% and 5%, and a little was at 10%!   And the really great part of it was, a lot of that was from paying cell phone bills, telephone bills, gasoline, groceries (all at least 3%)… or money I would have spent regardless.  The fact that much of my discretionary spending was done at places offering great prices and bonus cash back just sweetens the pie!