How to Maximize Rewards on Everyday Spending

Woman using credit card on everyday spending

While many rewards enthusiasts focus on signing up for new credit cards to earn signup bonuses, not everyone has the time or desire to play the signup game. There is effort involved in tracking multiple cards, annual fees, and rewards programs, after all, and some people don’t want to spend their time or mental energy this way.

If you’re someone who falls into this category, you may be better off maximizing one or two cards instead of chasing rewards. Fortunately, you can earn plenty of rewards over time if you’re savvy about your card’s benefits and bonus categories.

The key to getting the most out of your rewards cards is understanding how they work and looking for opportunities to earn more points on your everyday spending. Here are some tips that can help.

Brainstorm every bill you could pay with a credit card

Because rewards cards offer points based on each dollar you spend, maximizing the amount you can spend on credit is the best way to boost your rewards haul. The smartest strategy to use here is figuring out how many of your monthly bills you can pay with a credit card.

While you may not be notified or aware, it’s possible that bills you’ve been paying with a check or debit card for years can be paid with a credit card without any fees. While your bills may vary, some expenses you should try to pay with a credit card include:

  • Rent
  • Utility bills like electric or gas
  • Health insurance
  • Cable television and internet
  • Cell phone
  • Taxes
  • Daycare
  • Auto and home insurance
  • Subscription services
  • College tuition or student loans
  • Medical bills
  • Lawn care

Keep in mind that these are just some of the bills you could be paying with credit. Depending on your situation, you could have additional, uncommon expenses to cover that could be paid with credit with ease.

Also, remember that these additional bills should be paid with credit on top of your everyday expenses like groceries, dining out, gas or bus fare, and miscellaneous spending. Every time you buy something in person or online, you should strive to pay with your rewards card if you can.

Leverage your rewards card bonus categories

It’s also important to leverage your favorite card bonus categories, whatever they may be. This is especially important if you have a few cards with different bonus categories since you’ll want to make sure you’re using the right card for bills that let you earn bonus points.

Let’s say you have a travel credit card that earns 3x points on dining and travel and another card that earns 6x points at the grocery store. In that case, you would be smart to use the travel card for dining and travel purchases and your other card when you stock up on food. While the amount of rewards you earn with individual purchases may seem nominal, using the right card for the right purchase can help you earn a lot more rewards over time.

Set up auto-pay bills to be paid with credit

Most of us have bills set up to be paid automatically, whether it’s our Netflix and Hulu subscriptions, gym membership, or utility bills. Make sure each bill you have set up to be paid automatically is set up to be paid with your rewards card and not a debit card. This way, you can earn rewards points on those expenses every month.

Use shopping portals and dining clubs

Many flexible rewards programs, frequent flyer programs, and hotel loyalty programs have shopping portals you can access to earn extra points. Major airlines like American, Delta, and United also have shopping portals that work similarly. (See also: How to Maximize Rewards Through Credit Card Shopping Portals)

Some programs like Southwest and Delta also offer dining clubs. These programs let you earn additional points or miles just for dining at participating restaurants in your area. It’s easy and it’s free to join, so you may as well earn extra miles on your spending if you’re going to dine out anyway. (See also: Everything You Need to Know About Airline Dining Rewards Programs)

How much the average family can earn

If you are skeptical the average family can rack up meaningful rewards without signing up for new cards over and over again, look at how this might work in real life. For example, imagine a family of four with two rewards card-toting adults. Across the two of them, they have:

  • A cash back card that earns 2% back
     
  • A travel credit card that earns 3% on dining and travel
     
  • A rewards card that earns 6% cash back at the grocery store on up to $6,000 in spending each year

To figure out how much this family might earn, we used Bureau of Labor Statistics spending averages from 2017. Here’s a rundown of that data for the year plus how much a family could earn in rewards over 12 months based on average expenses:

  • Food at home ($4,363): $261.78 in rewards at 6%
     
  • Food away from home ($3,365): $100.95 at 3%
     
  • Utilities, fuels, and public services ($3,836): $76.72 at 2%
     
  • Household operations ($1,412): $28.24 at 2%
     
  • Household supplies ($755): $45.30 at 6%
     
  • Household furnishings and equipment ($1,987): $39.74 at 2%
     
  • Apparel and services ($1,833): $36.66 at 2%
     
  • Gasoline and motor oil ($1,968): $39.36 at 2%
     
  • Other vehicle expenses ($2,842): $56.84 at 2%
     
  • Healthcare ($4,928): $98.56 at 2%
     
  • Entertainment ($3,203): $64.06 at 2%
     
  • Personal care products ($762): $45.72 at 6%
     
  • Education ($1,491): $29.82 at 2%

Total rewards: $923.75

While $900+ is a lot to earn in rewards within a year, you have the potential to earn a lot more. After all, these are just some of the expenses the average family faces and not all of them. If you could pay some additional big bills with credit each month like daycare or your rent, you could significantly add to your bottom line.

What to watch out for

While maximizing rewards cards is a smart idea if you’re using them already anyway, there are always pitfalls to be aware of when you’re using a credit card. Here’s what to watch out for during your quest for more cash back and travel rewards.

Fees for using credit

While there are many bills you can pay with credit without a fee, some vendors, merchants, and service providers charge a fee to use a credit card as payment. Fees are especially prevalent on bills such as utilities, cable or internet, rent, and insurance. Make sure to verify you aren’t being charged a fee to use credit before you proceed.

Annual fees

Don’t forget that some rewards cards charge annual fees. These fees may be worth it depending on your spending and rewards haul, but you should always factor them into the equation to make sure each fee is worth paying. If you’re against paying annual fees, look for rewards cards that don’t charge one.

Budgeting mishaps

Using a credit card for all your expenses may simplify your financial life, but it could also cause your budget to fall out of whack. Make sure you’re only spending on purchases you planned to make anyway, and that you’re tracking your spending and paying off your credit cards regularly.

Debt

Never use credit cards for purchases you can’t afford to repay if you’re pursuing rewards. The interest you’ll pay will always be much more than the rewards you earn. If you’re worried using credit will cause you to rack up debt you can’t afford to repay, you’re better off sticking to cash or debit instead.

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Want to maximise your credit card rewards? The key to getting the most out of your rewards cards is understanding how they work and looking for opportunities to earn more points on your everyday spending. We’ve got the ultimate tips and tricks to help you save money and earn more rewards! | #creditcards #rewardsprogram #creditcardrewards


Source: feeds.killeraces.com

9 Financial Strategies for Padding Your Bank Account in Case 2021 Goes Sideways

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So, you thought 2020 was bad? Just wait!

OK, we’re kidding. Obviously, 2021 should turn out way better than 2020 did, right?

There’s no way it could be worse, right?

Right?

Welllllllll… we hate to sound like pessimists, but if there’s one thing life has taught us, it’s that things can always get worse.

Maybe COVID’s sequel shows up. Maybe the economy crashes again. Maybe our weird politics get even weirder. Maybe aliens land in Times Square.

Just in case, we’ve got some proactive moves you should make to protect your bank account in case things go south. Before the next crisis gets going, let’s get started with the protective measures:

1. Save Up An Emergency Fund

This past year has taught us the hard way that everyone should have an emergency fund. You need a place where you can safely stash your savings away — but still earn money on it.

Under your mattress or in a safe will get you nothing. And a typical savings account won’t do you much better. (Ahem, 0.06% is nothing these days.)

But a debit card called Aspiration lets you earn up to 5% cash back and up to 16 times the average interest on the money in your account.

Not too shabby!

Enter your email address here to get a free Aspiration Spend and Save account. After you confirm your email, securely link your bank account so they can start helping you get extra cash. Your money is FDIC insured and they use a military-grade encryption which is nerd talk for “this is totally safe.”

2. Stop Overpaying for Stuff

Your bank account will be in better shape in 2021 if you stop overpaying for things. For instance, wouldn’t it be nice if you got an alert any time you’re shopping on Walmart and are about to get ripped off?

That’s exactly what a free service called Capital One Shopping does. (No need to be a Capital One customer to use it!)

Capital One Shopping’s free alerts can be added to your browser. Before you check out, it’ll check other websites, including Amazon, Target, eBay and others to see if your item is available for cheaper. It will also show you coupon codes, set up price-drop alerts and even let you see the item’s price history.

Let’s say you’re shopping for a new TV. You’re ready to check out, and you assume you’re getting the best price. Here’s when Capital One Shopping will pop up and let you know if you’re about to overpay. It will even automatically apply any known coupon codes to your order.

So far, Capital One Shopping has saved users more than $70 million.

You can get started with Capital One Shopping in just a few minutes to see if you’re overpaying online.

3. Get Paid Every Time You Buy Toilet Paper

Grocery shopping was never exactly pleasant. But these days, it’s a downright struggle. Fighting crowds; keeping six feet of space — just buying toilet paper is a feat. Shouldn’t you have something to show for it?

A free app called Fetch Rewards will reward you with gift cards just for buying toilet paper and more than 250 other items at the grocery store.

Here’s how it works: After you’ve downloaded the app, just take a picture of your receipt showing you purchased an item from one of the brands listed in Fetch. For your efforts, you’ll earn gift cards to places like Amazon or Walmart.

You can download the free Fetch Rewards app here to start getting free gift cards. Over a million people already have, so they must be onto something…

4. Knock $540/Year From Your Car Insurance in Minutes

Car insurance is another thing you shouldn’t overpay for in 2021. When’s the last time you checked car insurance prices?

You should shop your options every six months or so — it could save you some serious money. Let’s be real, though. It’s probably not the first thing you think about when you wake up. But it doesn’t have to be.

A website called Insure.com makes it super easy to compare car insurance prices. All you have to do is enter your ZIP code and your age, and it’ll show you your options.

Using Insure.com, people have saved an average of $540 a year.

Yup. That could be $500 back in your pocket just for taking a few minutes to look at your options.

5. Stop Paying Your Credit Card Company

If things go south financially, the last thing you want to be saddled with is credit card debt. And the truth is, your credit card company doesn’t really care. It’s just getting rich by ripping you off with high interest rates. But a website called AmOne wants to help.

If you owe your credit card companies $50,000 or less, AmOne will match you with a low-interest loan you can use to pay off every single one of your balances.

The benefit? You’ll be left with one bill to pay each month. And because personal loans have lower interest rates (AmOne rates start at 3.49% APR), you’ll get out of debt that much faster. Plus: No credit card payment this month.

AmOne keeps your information confidential and secure, which is probably why after 20 years in business, it still has an A+ rating with the Better Business Bureau.

It takes two minutes to see if you qualify for up to $50,000 online. You do need to give AmOne a real phone number in order to qualify, but don’t worry — they won’t spam you with phone calls.

6. Cut Your Food Budget by Planning Ahead

Even if you’re gainfully employed and not in imminent danger of being evicted, you’re probably struggling with bills like most of us are. Groceries are a huge part of everyone’s budget these days, so they’re a big target for savings.

Try preparing for the week ahead with some meal planning. This goes beyond just making a shopping list. Real meal planning helps you save money because it helps you use what you buy, preventing food and money waste. It also prevents you from spending extra cash on emergency lunches or late-night takeout.

First, figure out how many meals you’re responsible for making every week. If it’s just you, your answer might be 21: seven breakfasts, lunches and dinners. If you have a family, count meals per person — a dinner for three people counts as three dinners, even if you all eat the same thing.

Now figure out how much food you’ll need to buy to make it until your next grocery trip. If you buy the same items repeatedly, you know which ones to stock up on when they go on sale. Stocking up on sale items also helps you freeze meals for the future. If there’s a way to buy in bulk and prep the foods you eat the most often, do it!

7. Add $225 to Your Wallet Just for Watching the News

It’s been a historic time for news, and we’re all constantly refreshing for the latest updates. You probably know more than one news-junkie who fancies themselves an expert in respiratory illness or a political mastermind.

And research companies want to pay you to keep watching. You could add up to $225 a month to your pocket by signing up for a free account with InboxDollars. They’ll present you with short news clips to choose from every day, then ask you a few questions about them.

You just have to answer honestly, and InboxDollars will continue to pay you every month. This might sound too good to be true, but it’s already paid its users more than $56 million.

It takes about one minute to sign up, and start getting paid to watch the news.

Mike Brassfield (mike@thepennyhoarder.com) is a senior writer at The Penny Hoarder. He’s got his game face on and is ready for 2021, come hell or high water.

This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.

Source: thepennyhoarder.com

4 credit cards offering a $500 sign-up bonus

Nowadays, it is easy to score a generous introductory bonus on a credit card. Just by meeting eligibility requirements and a specified spend threshold, you can bring home hundreds of dollars in extra pocket change when you sign up for a new card.

While cash back cards typically offer less valuable introductory bonuses than rewards cards offering points or miles, these bonuses come with a big advantage. Rather than having to redeem points a certain way to stretch their value, you can use a big cash back bonus to make a huge dent on any kind of purchase.

Plus, cash back cards are offering higher and higher bonuses to compete with other rewards currencies – even up to $500 or more.

Right now, $500 (or higher) intro bonuses are limited to business credit cards – but offers change regularly, so a personal card boasting an inflated bonus could be around the corner. Personal cards, including the Capital One® Savor® Cash Rewards Credit Card, have offered intro bonuses up to $500 in their history. Though the sign-up offer on the Savor is not at its peak, keep an eye out for future limited-time offers on this and other cards.

Which cards are currently offering $500 introductory bonuses?

At the moment, only small business credit cards are offering intro bonuses of $500 or more. Take a look at four current offers below:

Card Introductory offer
Ink Business Cash® Credit Card $750 if you spend $7,500 in first 3 months
Ink Business Unlimited® Credit Card $750 if you spend $7,500 in first 3 months
Capital One Spark Cash for Business $500 if you spend $4,500 in first 3 months
U.S. Bank Business Cash Rewards World Elite™ Mastercard® $500 if you spend $4,500 in first 150 days

As you can see, each of these generous intro offers requires a fairly high spend threshold to reach it. Before you sign up for one of these cards, ensure you can spend enough to earn the bonus without overextending your budget.

See related: How business credit cards can help you run a business from home

Who is eligible to earn these bonuses?

Before jumping at one of these generous offers, you should ensure you are eligible to earn the bonus. Issuers often have restrictions on who can take home a sign-up bonus.

For example, the Ink Business Cash and Ink Business Unlimited cards from Chase are subject to the 5/24 rule. This means if you’ve opened five or more credit cards with any issuer in the last 24 months, you likely won’t qualify for either card.

On the bright side, Chase business cards will not count against your 5/24 standing for future applications.

For the Capital One Spark Cash card and U.S. Bank Business Cash Rewards card, the sign-up bonus is limited to new account holders. If you currently have or have previously had one of these cards, you might not be eligible for a new bonus on the same card.

Cash bonuses vs. points bonuses

The possibilities for a $500 sign-up bonus are endless – allowing you to book a trip, buy yourself a special something, offset your next major bill and so much more. It is easy to see how an extra $500 is valuable – but is it the best offer you can find?

The short answer is no. Points-based sign-up bonuses can offer incredible potential value when you redeem rewards strategically. Because the value of points and miles shifts depending on how you spend them, you can often get much more than the estimated cash value of a sign-up bonus by redeeming your points for well-priced flights, hotels or other promotions.

For example, check out some top points-based introductory offers and our estimated value. At first glance, the following bonuses seem to offer a similar value to a $500 cash bonus. But when you redeem your points for travel, they can actually take you much further.

Card Introductory offer Estimated value of introductory offer
IHG® Rewards Club Premier Credit Card 140,000 points if you spend $3,000 in first 3 months $770
Chase Sapphire Reserve® 50,000 points if you spend $4,000 in first 3 months $750 (when redeemed for travel in the Ultimate Rewards portal)

Chase Sapphire Preferred® Card*

60,000 points if you spend $4,000 in first 3 months $750 (when redeemed for travel in the Ultimate Rewards portal)
IHG® Rewards Club Traveler Credit Card 100,000 points if you spend $2,000 in first 3 months $550

But there is a big drawback – point bonuses are typically only worth their full value when you redeem them for a specific kind of purchase. If a card offers an 80,000-point bonus – but points are only worth a full 1 cent each when redeemed for travel – then that bonus is only ideal for cardholders who already spend a significant amount on travel. If you’d sacrifice half the value of your bonus offer to redeem it for another kind of purchase – such as a statement credit to cover your bills – then you are better off opting for a more flexible cash back offer.

Should you sign up for a $500 bonus offer?

Before jumping at a high bonus offer, you should always consider the spend requirement. If you will have to charge more than you can afford to pay off in order to earn the bonus, it might not be worth it.

See related: Card APRs are at a record high. Is a sign-up bonus still worth the risk?

Additionally, cash bonuses don’t always offer as much potential value as a points-based introductory bonus. Consider how you want to spend your rewards and which card’s earning rate works best for you before you apply.

*All information about the Chase Sapphire Preferred Card has been collected independently by CreditCards.com and has not been reviewed by the issuer. This offer is no longer available on our site.

Source: creditcards.com

My 2021 credit card predictions

In 2020, the coronavirus pandemic brought a huge shift in spending as the country shut down. The travel industry specifically took a hit, and many card issuers responded by adding rewards on everyday spending to travel cards.

While I think travel spending will eventually rebound in 2021, it seems likely that the additional perks on everyday spending are here to stay.

Read more from our credit card experts.

Ask Ted a question.

Everyday spending

Early on in the COVID-19 pandemic, many card issuers pivoted to grocery spending, food delivery and takeout, streaming services, home improvements, and other everyday spending categories out of necessity. In 2021 and beyond, I think they’ll do so by choice.

These perks really seem to be resonating with consumers, whether we’re talking about earning bonus rewards for these types of spending, redeeming points or miles at a higher than normal ratio to offset related purchases, receiving free premium memberships for services such as DoorDash and Instacart, or getting statement credits to defray eligible costs.

It all adds up to cash back with a twist. There’s an experiential component that cardholders love and habitual aspects that appeal to card issuers trying to build loyalty. If you’re more likely to use a card that offers these perks – especially if you’re willing to pay an annual fee – that’s a win all around.

See related: Guide to Chase Pay Yourself Back

Travel

Necessity is the mother of invention, of course, and the fact that the pandemic crippled travel led to many of the aforementioned incentives. I expect travel to bounce back in a big way once we have widespread vaccine availability. Late Q2 or early Q3 seems like a good bet, according to health experts.

This should unleash an incredible amount of pent-up travel demand. People want to see their families and friends, they want to explore bucket list destinations and many will have money (and points and miles) to burn after a year of lockdowns.

I expect the good deals will last for a while because it’s a competitive industry, and business travel should remain depressed longer than leisure travel. Airlines will want to pack planes, hotels will want to fill rooms and cruise lines will be especially desperate for business. We should see favorable prices along with other incentives to liquidate rewards and sign up for travel credit cards.

Approval standards

In 2020, lenders became much more risk-averse as the pandemic created a ton of uncertainty and job losses. In Q2, 72% of credit card issuers tightened their approval standards and 0% eased them, according to the Federal Reserve’s Senior Loan Officer Survey. In Q3, 31% tightened and 4% eased. A similar trend played out with respect to existing cardholders’ credit limits.

This hit balance transfer cards the hardest. According to Mintel Comperemedia, card issuers sent 42% fewer direct mail advertisements for 0% balance transfer cards in the first three quarters of 2020 when compared with the same period in 2019. Card issuers were worried enough that their existing customers wouldn’t pay them back; taking on new customers with existing debt wasn’t particularly appealing.

This will hopefully turn around in the second half of 2021, assuming we have widespread vaccine access and a better economy and job market. I think balance transfer cards will be the last card sector to bounce back, however.

sign-up bonuses. But approval standards will likely remain tight as issuers look for the most creditworthy and affluent applicants. We saw some of this in late 2020, like the 100,000-mile Capital One Venture Rewards Credit Card bonus (since expired) which required $20,000 of spending within the new cardholder’s first 12 months.

I think particularly lucrative bonuses will become more widely available and less restrictive in the second half of 2021. Early in the year, the best offers will probably be reserved for those with high credit scores and high incomes.

Final thoughts

A couple of pleasant surprises this year: Credit card debt and delinquencies both fell in 2021. Credit card debt declined 11% between February and October, according to the Fed. This could be due in part to the government stimulus package passed earlier this year or consumers spending less and prioritizing paying down debt.

While we’re all anxious for our lives to return to normal, carrying less credit card debt would be a good habit to hold onto after the pandemic is over.

Have a question about credit cards? E-mail me at ted.rossman@creditcards.com and I’d be happy to help.

Source: creditcards.com