What if you could pay for your next date night or trip to the grocery storeâwithout having to dip into your budget? If you use cash back to your advantage, these benefits could become a reality.
In the past, you had to swipe a credit card to earn cash back. But with Discover Cashback Debit, you can earn cash back by spending with your debit card (you read that right: debit card), allowing you to reach your financial goals without the risk of going into debt.
To best use this budget bonus, you might be wondering, âWhat should I do with my debit card cash back?” According to Eric Rosenberg, financial consultant and founder of the website Personal Profitability, âYou could put [your cash back] into savings or treat yourself to something from your wish list.”
Read on for things to do with cash back to help you achieve the right balance of responsibility and fun:
1. Save for a rainy day
Sometimes it seems like everything goes wrong all at once: You get a flat tire. The sink starts leaking (ugh, again!). You get a parking ticket. Since life can throw unexpected, costly curveballs your way, it’s important to have an emergency fund. Also known as a rainy day fund, an emergency fund is cash that’s set aside to cover unplanned, yet crucial, expenses.
âSo many people can’t afford the cost of an emergency from their savings,” Rosenberg says. If you don’t have this type of fund to fall back on, starting an emergency fund (or adding to an existing fund) could be a top priority when evaluating what to do with your cash back from a debit card.
When thinking about building an emergency fund as a thing to do with cash back, note that experts typically recommend putting aside at least three to six months of living expenses for this purpose. To maximize your emergency fund, you may want to consider moving these savings (and the cash back you’re putting toward this fund) to a high-yield savings account. That way, your emergency fund can steadily grow with interest until you need it. (P.S. More to come on how to automatically move your cash back into savings.)
2. Pay down your debt
If you owe, it can be tough to climb your way out of debt. Whether it’s from credit cards, student loans or a mortgage, interest is accruing and costing you money. Learning how to use your debit card cash back to offset debt can help you save on those interest payments down the road.
According to consumer money-saving expert Andrea Woroch, when you’re focusing on paying off debt, “It’s natural to cut back where you can. But you may eventually hit a wall where you can’t find ways to tackle expenses any further,” she says. That’s where learning how to use debit card cash back comes into play. Since a debit card with a cash back feature can allow you to earn for your everyday spending, those earnings can become a new source for paying down debt, Woroch adds.
3. Shore up for those special moments
You know you’d like to have more nights out, but they don’t come cheap. What to do with your cash back could include spending on special outings, Woroch says. Is there a restaurant you and your significant other have been dying to try? Is there a concert the whole family is super eager to see? There may also be larger events with family and friends to think aboutâplanning a milestone birthday or anniversary or that getaway with college buds. You can set aside your debit card cash back and earmark it for your relationships to create memories that will last a lifetime.
âYou could put [your cash back] into savings or treat yourself to something from your wish list.”
4. Support your children’s allowance
If you have kids, you’ve probably heard this one before: âMom, Dad, can I have some money?” Sometimes it can feel like you’re a walking ATM. One thing to do with cash back is to set aside an allowance for your kids. You can then use this cash to teach your children good savings habits and how to manage money on a monthly basis for the things they need and want, says Rosenberg of Personal Profitability. The best part: The money isn’t really coming out of your budget since you’re earning it for your everyday expenses and from money you’d be spending anyways. Win-win.
In thinking about what to do with your cash back, spending it on gift-giving and holiday expenses may be a good goal. “Some people go into debt during the holidays. To help avoid that circumstance, use your cash back to get ahead,” Woroch says.
And, really do think ahead if holiday spending is on your list of things to do with your cash back. The earlier you stash your cash back away for the holidays, the longer it will have time to accrue if you put it in a savings account for safekeeping. Season’s greetings may be the last thing on your mind while you’re flipping burgers on the 4th, but planning ahead could really impact your end-of-year festive spending.
How to maximize your cash back
Now that you know what to do with your cash backâwhether it’s going to work for your emergency fund or funding emergency holiday giftsâconsider steps you can take to get the most out of your extra dough. For example, find a rewards program that matches your spending style. With Discover Cashback Debit, you can earn 1% cash back on up to $3,000 in debit card purchases each month.1 That’s up to $360 a year. Not too bad for just going about your daily debit card spending.
Get 1% cashback on Debit from Discover. 1% cashback on up to $3000 in debit card purchases every month. Limitations apply. Excludes Money market accounts.Discover Bank,Member FDIC.Learn More
To make the process of saving that extra cash even easier, consider opening a Discover Online Savings Account. If you sign up for Auto Redemption to Savings, your cash back will be automatically deposited into your savings account every month.
âThe hardest part about saving for many people is remembering to make a transfer or take the cash to the bank,” Rosenberg says. “If you can automate it, you are setting yourself up for success. It’s like saving while you sleep.”
If you’re still considering how to use your debit card cash back to the fullest, Woroch suggests paying for group purchases when you’re out with family or friends. “Whether you’re going to dinner or renting a condo, cover the entire expense on your card and ask friends and family to pay you back with cash or [via mobile payment],” Woroch says. “This way you can benefit from earning more rewards.”
When it comes to how to use your debit card cash back, the key is to make sure you have enough in your account and aren’t spending too much if you offer to temporarily foot the bill. You don’t want to overextend in order to earn, as you could be hit with overdraft fees or not have enough in your account to cover bill payments, Woroch says.
“Whether you’re going to dinner or renting a condo, cover the entire expense on your card and ask friends and family to pay you back with cash or [via mobile payment]. This way you can benefit from earning more rewards.”
Get ahead with a combination of strategies
If you’re looking for things to do with cash back, using these tactics can help you improve your financial foundation and have some fun along the way. Understand your needs and goals to help you create a cash back plan, and then maximize your strategy with tools to help you automatically direct your cash back to savings to limit the temptation to spend the money elsewhere.
“We are all so busy these days, and managing money is often pushed down on the to-do list,” Woroch says. Learning how to use your debit card cash back can help you put money management front and center. Start earning!
1 ATM transactions, the purchase of money orders or other cash equivalents, cash over portions of point-of-sale transactions, Peer-to-Peer (P2P) payments (such as Apple Pay Cash), and loan payments or account funding made with your debit card are not eligible for cash back rewards. In addition, purchases made using third-party payment accounts (services such as VenmoÂ® and PayPal, who also provide P2P payments) may not be eligible for cash back rewards. Apple, the Apple logo and Apple Pay are trademarks of Apple Inc., registered in the U.S. and other countries.
The post How to Use Your Debit Card Cash Back to the Fullest appeared first on Discover Bank – Banking Topics Blog.
We are a month and a half into quarantine and date nights in many households have devolved into, âWhat have we not seen on Netflix yet?âÂ While we are all ready to get back out and about, there are plenty of fun date night at home options to help you enjoy and appreciate your partner.Â This post is partially inspired by the fact that we are celebrating our wedding anniversary tonight and I was already doing so research on what to do this weekend.Â I figured if I was already doing the work, I might as well share the wealth with you all!Â Â
Check out a few of our best date night in ideas
Name that Tune
This really is a fun activity that we typically do on road trips, but it works just as well for date night.Â Play each other your favorite songs from different eras or events in life.Â Â
What song was popular when you went to your first school dance?Â Did you ever learn a choreographed dance to a song?Â What was it?Â What was your first favorite country/hip hop/punk song?Â Did you ever dedicate a song to someone on the radio? Make a mixtape?Â First breakup/heartbreak song you listened to 100 times?
Music is such an integral part of our memories.Â It is sure to bring out some great stories from your partner that you have never heard before and some great stories from your past that you may have completely forgotten about. All you really need is a Spotify account, your beverage of choice!
This is an amusing challenge for the nose and tastebuds.Â Taste three (or five–no judgment here) wines and figure out which is which based solely on the tasting notesâ¦.you know the âhints of pencil lead and cranberry.âÂ This can be made romantic with dim lights and some candles or you can make this more upbeat with some fun background playlists.
Optional additions to make the night more festive: Cheeses, nuts, olives, crackers, honey
Minute to Win It
Impress each other with feats of strength and balance.Â This is an evening bound to be full of laughter.Â Check out this video for inspiration! Challenges include…
Face the Cookie.
Movin’ On Up.
Junk in the Trunk.
Suck It Up.
Ping Pong Bounce.
Sweets for Sweethearts
Bake together…even if neither of you is an expert in the kitchen, learning something new together is good for relationships!
Here are some recipes that have videos to go along with them
For easy cooking try these 3 Ingredient Desserts
For all those ripe bananas on your counter
For when you can only be trusted with the microwave
It sounds silly, but this really can be a learning experience. If youâve been together you may think you know all the answers…but remember peopleâs tastes and preferences change.Â Do you really know that sweet tarts are still his favorite candy? Or is Paris still her number one destination? The answers could surprise you!
Yes! This is actually possible via Netflix Party. Â Pick a movie ahead of time, grab the popcorn and candy and chat with your favorite duo.Â Â
Take a trip down memory lane
Look at each otherâs pictures from your favorite vacation together.Â Youâll be surprised to see the vacation through their eyes and their memories.Â You can relive the best times together and appreciate it in a whole new way.Â Bring in even more sensory memories by adding a favorite food or drink you discovered during that trip.
Or Take a Virtual Trip
Ever wonder what Venice is like during lockdown?
Join Travel Curious on their next tour with your Venetian born guide, Luca, who will take you on a live virtual walking tour of Venice and will end up in the Venetian mask-maker artisan shop.Â
Join for free on their Instagram Live feed on May 15 2020 at 15:00pm BST / 10:00am EST