6 Credit Card Secrets; Banks dont tell you
As a new college grad that is fresh out of student loans, it's important to save money wherever you can. One way that's affordable and easy to do is by maximizing the rewards from your credit card spending. Follow these 6 tips and tricks, and you'll save enough money over the course of a year to buy a car or take a vacation!
-Keep track of your credit card spending.
-Use multiple options for making purchases.
-Think outside the box about what counts as travel expenses (ie food, clothes, lodging).
-Track what kind of rewards programs are available for each card.
-Don't be afraid to negotiate.
-Check out Credit Card reward calculators online.
Keep Track of your Credit Card Spending
If you're using credit cards, you should absolutely keep track of how much you spend and on what. Tracking your spending allows you to create a budget that is aligned with your spending habits, so you can save money and pay off debt. You should know exactly what amount of your income goes to certain things like food, education, transportation, etc.
However, doing this for each credit card will take a lot of time. Instead, set aside a single box to keep track of your spending and categorize all your purchases into three buckets: debt, emergency, and fun money. You can also keep tabs on how much money you have leftover to put toward different things like savings and vacations.
If you're worried about keeping track of everything manually, know that there are plenty of companies that will do this for you automatically! Some apps tend to offer more helpful features than others, so it's worth looking into which one you prefer.
Use Multiple Options for Making Purchases
If you're using credit cards for everything, it's easy to let yourself get skewed by the idea of getting the best rewards. However, by using multiple options, you can save a lot of money on rewards. For example, instead of using your normal debit card for gas every week, use an Express Rewards Credit Card or an ATM Rewards Card that gives you cash back on your purchases. This way, you can get cash back and free gas in the same trip!
To keep this from getting out of hand, keep track of all your different spending on the third box in your spending tracking box (fun money). Once you have enough to buy something, like a new phone or a gift for someone special, you can focus on that and stop worrying about the money.
Also, be sure to keep your spending under control! You don't want to get carried away with using credit cards because they're all free money. If you're having trouble keeping track of your spending habits, set a budget for yourself that includes how much money you will spend using credit cards. Budgeting is the best way to stay in control of your spending.
Think Outside the Box about What Counts as Travel Expenses
This next section is going to be a list items you did not expect to count as travel expenses. There are plenty of other things that might count as well, so remember that using rewards credit cards doesn't just have to be limited to traditional travel expenses.
Food and drink : While staying at a hotel or motel counts as travel expenses, eating them certainly doesn't! You can amass points or airline miles on the food you eat in-house, but make sure that you're doing it for the right reasons. You don't want to end up spending more just for some rewards.
: While staying at a hotel or motel counts as travel expenses, eating them certainly doesn't! You can amass points or airline miles on the food you eat in-house, but make sure that you're doing it for the right reasons. You don't want to end up spending more just for some rewards. Hotel upgrades : If you need them to stay at a particular hotel to get enough credit card points, by all means upgrade! There's nothing wrong with that. But even if you don't have to do that, it's sometimes worth upgrading because it's better than a cramped budget room.
: If you need them to stay at a particular hotel to get enough credit card points, by all means upgrade! There's nothing wrong with that. But even if you don't have to do that, it's sometimes worth upgrading because it's better than a cramped budget room. Clothing purchases : If you need new clothes for a trip, then go ahead and purchase them before you go (or if you have the spending cash). Don't buy more clothes than what your trip will require! But if your home is running low on clothes for whatever reason, there should be nothing wrong with purchasing some clothing using rewards.
: If you need new clothes for a trip, then go ahead and purchase them before you go (or if you have the spending cash). Don't buy more clothes than what your trip will require! But if your home is running low on clothes for whatever reason, there should be nothing wrong with purchasing some clothing using rewards. Alcohol and toiletries : Alcohol can be expensive in hotels, even at the cheapest of rates. And the same goes for most toiletries. That's why it's worth purchasing them from home so that you don't spend extra money on luxuries like these.
: Alcohol can be expensive in hotels, even at the cheapest of rates. And the same goes for most toiletries. That's why it's worth purchasing them from home so that you don't spend extra money on luxuries like these. Cell phone plans : If you need a new cell phone plan before your trip, then go ahead and take advantage of it using your credit cards. Just make sure that you're getting the best value for your points.
: If you need a new cell phone plan before your trip, then go ahead and take advantage of it using your credit cards. Just make sure that you're getting the best value for your points. Airport costs : Be careful here because airport costs can be pretty expensive.
Conclusion
Making sure you use rewards credit cards often can put you in a better financial situation than just relying on your regular debit or checking account. Plus, it's fun to rack up those points and miles throughout the year!
Remember, it's important to watch your spending and pay your bills on time so that you don't damage your credit score. That's why having rewards credit cards is a great way to go if you're looking to build up more good credit!
Do you have any tips for using rewards online? Are there any things that you think people should stop doing with their rewards? Share them below!
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