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Wise choice of bread
While many reward enthusiasts focus on registering new credit cards to earn signup bonuses, not everyone has the time or desire play the registration game. After all, there are efforts to keep track of multiple cards, annual fees, and reward programs, and some people don’t want to waste their time or mental energy this way.
If you fall into this category, you might be better off maximizing one or two cards than chasing rewards. Fortunately, you can earn a lot of rewards over time if you are well versed in your card’s benefits and bonus categories.
The key to making the most of your bonus cards is understanding how they work and looking for opportunities to earn more points on your day to day expenses. Here are some tips that might help.
Brainstorm each credit card bill
Since reward cards offer points based on every dollar you spend, maximizing the amount you can spend on credit is the best way to increase your rewards. The smartest strategy to use here is figuring out how many of your monthly bills you can pay with your credit card.
While you may not be aware or aware, it is possible that bills that you have paid by check or debit card for years can be paid by credit card without any fees. While your bills may differ, some of the costs you should try to pay with your credit card include:
- Rent
- Utility bills such as electricity or gas
- Medical insurance
- Cable TV and Internet
- Cellular telephone
- Tax
- Kindergarten
- Auto and home insurance
- Subscriber services
- College Tuition Fee or Student Loans
- Medical bills
- Lawn care
Keep in mind that these are just a few of the bills you can pay on credit. Depending on your situation, you may have additional unusual expenses that can be easily paid on credit.
Also remember that these additional bills must be paid on credit. on the top your daily expenses such as groceries, restaurants, gas or bus, and other expenses. Every time you buy something in person or online, you should try to pay with your bonus card if you can.
Use bonus categories of bonus cards
It’s also important to use your favorite bonus card categories, whatever they are. This is especially important if you have multiple cards with different bonus categories, as you need to make sure you are using the correct card for the accounts that allow you to earn bonus points.
Let’s say you have a travel credit card that gives you 3x food and travel points, and another card gives you 6x points at the grocery store. In this case, it would be wise to use the pass for lunch and shopping for the trip, and the second card when stocking up food. While the amount of rewards you earn for individual purchases may seem like nominal, using the right card for the right purchase can help you make money. many more rewards over time.
Set up automatic bill payment for credit payments
Most of us have automatic bill payment set up, whether it’s Netflix and Hulu subscriptions, gym memberships, or utility bills. Make sure that every account you set up for automatic payment is set up to pay with your bonus card, not your debit card. This way, you can earn bonus points for these expenses every month.
Use trade portals and dining clubs
Many flexible reward programs, frequent flyer programs and hotel loyalty programs have trade portals that you can access to earn extra points. Major airlines such as American, Delta, and United also have trade portals that operate in a similar manner. (See Also: How To Increase Rewards Through Credit Card Trading Portals)
Some programs, such as Southwest and Delta, also offer dining clubs. These programs allow you to earn extra points or miles just for dining at participating restaurants in your area. It’s easy and free to join, so you can also earn extra miles on your spending if you’re looking to dine out anyway. (See Also: Everything You Need To Know About Airline Loyalty Programs)
How much an average family can earn
If you’re skeptical that the average family can get meaningful rewards without signing up for new cards over and over again, look at how this can work in real life. For example, imagine a family of four with two adults with gift cards. For two of them:
- A money back card that gives you a 2% refund
- Travel credit card with 3% off food and travel.
- A reward card that gives you 6% cash back at the grocery store at an annual expense of up to $ 6,000.
To find out how much this family could earn, we used the 2017 Bureau of Labor Statistics average spending. Here’s a rundown of that data for the year plus how much a family can earn in benefits over 12 months based on average expenses:
- Food at Home ($ 4,363): $ 261.78 in reward at 6%
- Food Away From Home ($ 3,365): $ 100.95 at 3% off
- Utilities, Fuel & Utilities ($ 3,836): $ 76.72 at 2%
- Home Operations ($ 1,412): $ 28.24 at 2%
- Homeware ($ 755): $ 45.30 at 6% off
- Furniture and home furnishings ($ 1987): $ 39.74 at 2%
- Apparel and Services ($ 1,833): $ 36.66 at 2%
- Gasoline and engine oil ($ 1968): $ 39.36 at 2% off
- Miscellaneous Transportation Costs ($ 2,842): $ 56.84 @ 2%
- Healthcare ($ 4928): $ 98.56 @ 2%
- Entertainment ($ 3,203): $ 64.06 at 2% off
- Personal Care Products ($ 762): $ 45.72 at 6% off
- Education ($ 1,491): $ 29.82 from 2%
Total Rewards: $ 923.75
While $ 900 + is a lot to earn rewards throughout the year, you have the potential to earn a lot more. In the end, it’s just some costs faced by the average family, and not all of them. If you could pay a few additional large credit bills each month, like day care or rent, you could increase your bottom line significantly.
What to look for
While increasing the number of bonus cards is a smart idea, if you are already using them anyway, there are always pitfalls to be aware of when using a credit card. Here’s what to look out for when looking for more cashback and travel rewards.
Loan use fee
While there are many bills that you can pay on credit without commission, some merchants, sellers, and service providers charge a commission for using your credit card as payment. Fees are especially common on bills such as utilities, cable or Internet, rent and insurance. Make sure you are not charged any fees for using the loan before proceeding.
Annual fees
Please be aware that some bonus cards are charged an annual fee. These fees may pay off depending on your expenses and fees, but you should always factor them into your equation to ensure that each fee is worth paying. If you are against paying annual fees, look for bonus cards that don’t charge them.
Budgetary failures
Using a credit card for all of your expenses can make your financial life easier, but it can also make your budget worse. Make sure you only spend on the purchases you planned to make, and that you regularly track your spending and pay off your credit cards.
Duty
Never use credit cards for purchases that you cannot afford to repay if you want to be rewarded. The interest you will pay will always be much higher than the rewards you earn. If you are worried that using a loan will lead to an accumulation of debt that you cannot afford to pay off, you are better off sticking with cash or debit.
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