T’is almost time to deck the halls and allow that spirit of the holidays into your life. Unfortunately, it can also be a time when that spirit spins out of control when it comes to your holiday shopping.
In 2014, American consumers added an average of $986 to their overall debt. Although this seems like a small amount, it can quickly spiral out of control. This is according to the data published in MagnifyMoney.com.
The best way to avoid running up a bunch of credit card bills is by making a list based on your budget and then sticking to it. Where we all tend to get into trouble is when we start thinking, “Oh, I need to do more for uncle Fred,” or “Bob would just love that 92-piece toolkit” even though it’s not on your list. We understand that you want to please and surprise all your friends and family members but it’s important to do this while still adhering to the B (budget) word.
There is a strategy you need to have besides a holiday shopping strategy and that’s a strategy for your credit card. This begins with taking a good, hard look at your credit card issuers. The perks you get vary from card to card and not all come from the same networks– MasterCard, Visa, American Express or Discover. Dig out the agreement that came with each of your cards and read all the fine print. Each has its own rules for price matching, extended warranties and extended returns. It’s important to understand what they are especially when making big purchases. For example, with some of the cards you must register your purchase at the time you made it in order to get an extended warranty. But with others, you might have as many as 30 days before you need to register it.
Get a card that offers bonuses
There are numerous cards that will give you bonus cash back points for signing up. While you will need to have good credit to get one of these cards now would be a great time to get one. These cards usually require that you spend some specific amount of money in order to earn the bonus. Your holiday shopping should make it relatively easy to hit that number without having to run around looking for ways to spend money.
Check for special offers
There are cards such as Chase Freedom that will give you extra cash back or double miles when you use them to buy in certain categories like gasoline and groceries or when you shop at selected retailers. These offers are generally by the quarter so be sure to check to see what offers you could take advantage of in the next two months. You might also sign up for email alerts or text messages and be sure to keep an eye on your statements and the inserts that usually accompany them. Just do keep in mind that even 5X cash back is only $5 on $100 so be careful that you don’t end up getting into serious debt trying to earn those bonuses.
Look for linked card offers
There are a number of cards that offer the equivalent of discount coupons. However, you generally are required to sign up for the offer before you buy. Once you sign up, the discounts will be automatically linked to the card so you won’t even need a coupon. Many grocery stores offer linked cards so if you’re not getting special offers from the stores when you shop, be sure to sign up for them.
Don’t forget price matching
According to the website CardHub, roughly half of all credit cards have price matching. The way this works is that if you find an item listed for less than you paid for it, the credit card issuer will refund the difference. You will probably need to report this within a specific time frame like, 60 days. And will probably be required to prove the lower price. However, Citi Price Rewind automatically tracks your purchases for 60 days after you register them so all you need to do is notify them when you find the same item at a lower price.
Don’t buy extended warranties
We can’t remember the last time we bought some item costing $10 or more where we weren’t offered an extended warranty. But this is another area where you can save money as many cards will add on a warranty period after the product’s own warranty ends. But here’s another area where you need to read fine print. This is because many items don’t qualify like commercial or professional equipment, software, real estate and automobiles. Some cards don’t cover refurbished electronics although American Express and Visa do. If you decide to take advantage of a card’s extended warranty you will probably need to have your receipt, a copy of the manufacturer’s warranty and your credit card statement. You may also have to return the item within a specific time period.
Take advantage of extended return periods
Here’s another nice perk offered by some credit cards. This is where you would be able to return an item the store refuses to take back. Be aware that some cards make you register annually to continue receiving this benefit. You may also be required to show your credit card statement, your purchase receipt, and possibly some other documents. Some credit cards even require that the store’s manager write a letter as to why the refund was rejected and the letter must be on the company’s letterhead. This could be worth it in the case of a big-ticket item like a 60-inch 4k HDTV or a personal computer but as you can see this might require a good deal of work.
Finally, you may dream of earning enough airline miles for that dream vacation to Paris but if most of your shopping is done at grocery stores you’d be better off getting a card that offers cash back rather than reward points. Finding travel perks for an entire family can be very complicated. So in choosing a card and its rewards think about how you will spend the money and where you will use it.