A credit card can be both a friend and an enemy – giving you rewards for purchases, but charging high interest rates on what you owe. We’re here to show you how to even the score – here is a list of things to buy with your credit card now to reap the benefits later. Remember that if you don’t pay your balance in full, the majority of the rewards and benefits listed below are not worth carrying a balance for!
1. Gas: No one likes to pump all of their money into gasoline, but for commuters, it is a necessary cost. Get a little something back every time you stop at the pump by charging your gas purchases. Many cards offer bonus rewards for buying gas, which can add up over time.
- Best card: TrueEarnings Card from American Express will give you 3% cash back on gas purchases! With the average American spending between $1400-$1600 on gas per year, that’s an instant 50 bucks a year back in your wallet.
- What can it get you? That $50 per year can buy you 38 extra songs of iTunes, making your next road trip a little more fun.
2. Travel Costs: Let’s face it, between airfare, hotels and car rentals, travelling can be expensive. But, if you’re a constant jet setter, you can make these costs work for you.
- CapitalOne Orbitz Visa Platinum, If you book all flights, hotels and rentals on Orbitz, this card will give you triple the rewards on each of these purchases. If you take a weekend trip from LA to New York, travel costs will be about $1200. That’s 3600 points for that one trip and your well on your way to a free flight or cashback.
- CapitalOne Venture Rewards card offers 2 miles for every dollar spent. This means 40000 miles after one purchase and a 10000 miles signing bonus. What does that equate to? A $500 credit for any airline ticket purchase. With no restrictions, go ahead and book that Spring Break flight a little early.
- What can it get you? That $500 dollar credit is enough to get you a roundtrip ticket from New York to Miami – more than once!
3. Restaurants: We all know we’re supposed to be cutting back and eating at home more, but eating out is so much fun. Even if you only eat out a few times a month, you can charge your dinner to earn great rewards.
- Best Card: The Citi Forward Card gives you 5 points for every dollar spent at a restaurant. If redeemed for the Visa gift card, this is the same as 3.6% back on your purchase. If you want to rack up more rewards, offer to pay the entire tab on a dinner out with friends and they can pay you cash. Not only will you get more points, but you will also have cash on hand to use rather than a credit card for other purchases.
- What can it get you? So let’s say you put $150 on your card to pay for you and your friends to go out to dinner. If you do that once a year, you’ll get around $65. That’s enough to get you a concert ticket to see the Jonas Brothers or Phoenix – plus change!
4. Home Improvement: Summer is the time when you want to check off some of the tasks on your “To Do” list, which for many means starting (and hopefully finishing) home improvement projects.
- Best card: With the ChaseFreedom card, you can get 5% cashback on all home improvement purchases. If your house needs a new paint job, that can run you $3000 or more; however, this card will give you $150 back so you can cross off more items on that list.
- What can it get you? If you’re a little more ambitious this summer, you could install solar panels on your home. These can cost between $10,000-$20,000 (with many states offering a tax credit of 30%) and can save you up to $700 a year on your electricity bill depending on where you live. With the Chase Freedom Card, you can earn $500 to $1000 cash back! With that plus the money you’ll be saving on your energy bill, you’ll have enough to buy some nice furniture for your newly green home or some energy efficient appliances so you can bump up your savings even more.
5. Groceries: The USDA estimates that a family of four spends about $700-$900 dollars a month on groceries, with some variability depending on children’s age and the type of shopper or $8400 a year conservatively!
- Best card: The BlueCash from American Express gives you 5% back on grocery purchases after a certain dollar amount and 1% back beforehand. This means you can get at least $160 back a year to buy something other than groceries.
- What can it get you? $160 can be put towards buying more groceries. But what fun is that? After eating in so much, you can treat yourself to the full tasting course at Jean-Georges in NYC.
6. Gym Memberships: Between monthly fees and the initial membership fee, gyms can cost upwards of $800 a year.
- Best card: If you charge that to your Miles by Discover Card, you can get 1 mile for each dollar spent at the gym as well as 12,000 miles just by using your card the first year.
- What can it get you? These 12,800 points will get you well on your way to earning a free flight to the beach where you can show off your new body. Where are you going to go? You can book on any airline – JetBlue has cheap flights to the Dominican Republic and the Bahamas! Take your pick.
7. Back-to-School Purchases: It is estimated that parents will spend over $600 to get their children ready to go back to school.
- Best card: The Chase Freedom Card will earn 5% cash back on most of those costs, giving you an extra $30.
- What can it get you? After spending so much on your kids, treat yourself to a mani/pedi after all that shopping. You deserve it.
BONUS: Big ticket items for greatest rewards:
If you have the cash to back up the purchase, in other words, if you were planning on paying with a check or cash, then here are some big ticket items for big ticket rewards:
8. Student loans: For college students (or parents), consider the savings of charging your student loans this coming school year. How much of a difference can this really make? Well, let’s say you charge one-year’s tuition at $20,000.
- Best card: The Chase Freedom card will give you 1% cashback for this purchase, giving you an extra $200 by doing absolutely nothing. That should be enough to keep you well fed for a few weeks.
- What can it get you? That $200 can buy you 13 pizzas (enough for quite a few late night study sessions with friends), at least some of your textbooks for the semester (if you buy used it should pay for all of them!) or about 3 kegs if you happen to need a study break.
9. New Car: If you were going to use cash to buy that $25,000 new card, why not charge it?
- Best card: With the Blue Cash Card, you can earn $264 cash back from this single purchase. Hybrid cars will also earn you a $1000 – $2000 tax credit depending on the car
- What can it get you? Between the cash back, the tax credit and the gas savings, you can get free gas for almost the entire year!