If you have yet to finish your holiday shopping, you aren't alone — one National Retail Federation survey found that about 90 percent of shoppers hold out until December 23 to finish their shopping.
Nearly 45 percent of those survey respondents said they needed the extra time to weigh gift options, and another 22 percent simply wanted to wait for the best deals possible. While delaying your holiday shopping might make sense in some situations, it can also add a lot of unnecessary stress to an already hectic season.
Instead of playing the waiting game, you might consider using your credit card’s rewards to take charge of your holiday spending. We’ve previously outlined a few of our favorite rewards credit cards in detail, but here’s a quick rundown of the perks of those cards:
Discover® it Cash Back allows you to earn 5% cash back at different places each quarter like gas stations, grocery stores, restaurants, Amazon.com and more up to the quarterly maximum, each time you activate. Plus, earn unlimited 1% cash back on all other purchases - automatically.
Blue Cash Preferred® Card from American Express gives 6% cash back at U.S. supermarkets (on up to $6,000 per year in purchases, then 1%) - that means spending $60 a week at U.S. supermarkets could earn over $180 back per year.
Chase Freedom® earn 5% cash back on up to $1,500 in combined purchases in bonus categories each quarter you activate
Capital One® QuicksilverOne® Cash Rewards Credit Card purchases earn you 1.5 percent cash back on all purchases.
Amazon Prime Rewards Visa lets you earn up to 5 percent back on Amazon.com, 2 percent back at restaurants, gas stations, and drug stores, and 1 percent back on all other purchases.
One of the key ways to maximize your credit card rewards is to choose a credit card that matches your individual spending habits. If you — like 84 percent of consumers — check Amazon.com before making a major purchase, the Amazon Prime Rewards Visa might be your best bet. If you pick up numerous gift cards from the supermarket — like 13 percent of last-minute shoppers — a card with better rewards for grocery-store purchases would be a great option. If you tend to shop from a wide variety of merchants, a card with a flat cash-back rate is probably your best bet.
Armed with this information, it’s time to find every way possible to maximize your credit card rewards — particularly during the holiday season.
How to Maximize Your Holiday Points
With the holidays nearly upon us, plenty of consumers are preparing to give their credit cards a good workout. You’re undoubtedly picking up plenty of gifts for others, but there’s nothing wrong with wanting to turn that increased spending into additional rewards points for yourself. Here are a few ways to make the most of your credit card rewards:
1. Use your rewards credit card for holiday purchases.
The holidays are a time for giving — and spending. There are the presents, of course. But it doesn’t end there. Consider wrapping paper for those presents, holiday cards, and oodles of food and décor that accompany the season’s social gatherings.
In fact, the National Retail Federation projects that the average consumer spends $936 during the holidays. By charging those purchases to a credit card with great rewards, you can boost your normal earnings with relatively little additional effort. If you’re able to juggle several different credit cards to make the most of any retailer-specific rewards, you’re in even better shape.
2. Don’t underestimate to power of gift cards.
They might seem impersonal, but gift cards top the list of presents consumers say they would like to receive. The next time you’re about to buy some gift cards for your family and friends, figure out whether you can find creative ways to make these purchases to put some money back in your pocket.
Imagine you want to buy a $50 Starbucks gift card for your cousin. Your credit card might give you 1 percent cash back on any purchase and 2 percent cash back on transactions at gas stations. Armed with this insight, you might not want to head to your local Starbucks to score that gift card. Instead, grab a gift card the next time you fill up on gas to earn double the rewards points for the same purchase.
3. Use online shopping portals.
The National Retail Federation estimates that more than half of all holiday shopping takes place online. That’s an ideal situation for credit card holders, as most financial institutions offer online shopping portals where users can buy merchandise from popular retailers while earning bonus rewards points.
Say you want to purchase a $200 watch on Overstock.com for your partner. Instead of typing Overstock.com directly into your favorite web browser, you could instead go through your lender’s online shopping portal. You can often earn bonus cash back rewards or travel miles, depending on your card and lender.
This might seem complicated, but you can simplify the process by using EVReward.com. Simply enter a retailer’s information, and EVReward pulls up details about shopping portals that offer bonus points for that particular retailer. With a quick glance, you can easily determine the loyalty program with the best deal.
4. Redeem your rewards regularly.
A word of caution: The longer you stockpile your unused credit card rewards, the more you expose yourself to potential forfeiture, devaluation, and inflation. Because of this potential loss, it’s crucial to redeem your rewards early and often.
Some cards let you sign up for automatic redemption, crediting your account or sending a gift card for your favorite retailer whenever you’ve reached a set threshold. To really make these rewards work in your favor, consider investing the money or placing it in an IRA.
While trying to figure out the intricacies of credit card rewards can add a layer of complexity to your holiday routine, a few small steps can lead to big financial gains. Maximize your points by using your credit cards as much as possible, finding creative ways to make your purchases extra rewarding, and redeeming those rewards quickly. Becoming a holiday points master won’t completely save you from holiday stress, but it can make dealing with the financial aftermath that much more satisfying.
Editorial Disclaimer: Information in these articles is brought to you by CreditSoup. Banks, issuers, and credit card companies mentioned in the articles do not endorse or guarantee, and are not responsible for, the contents of the articles. The information is accurate to the best of our knowledge when posted; however, all credit card information is presented without warranty. Please check the issuer’s website for the most current information.