How to Decide Which Credit Card to Use for Each Holiday Purchase

Many of us spend a lot of money during our holidays: flights, gifts, new clothes, dining out, office dinners, office dinners, school parties, and so on.

But we can also earn at least some of that money back through credit card rewards – and since the holidays tend to increase our spending, it’s worth learning how to maximize the rewards we can earn.

I’ve outlined three different ways to get big rewards this holiday season: one that’s more challenging, one that’s far less effort, and one that’s great for people who pay their cards in full every month. (Mandatory Credit Card Disclaimer: Do not allow credit card interest charges to be canceled. Pay card payments in full, every month, as often as possible.)

Method 1: use the card with the highest reward

How many credit cards do you currently have and what types of rewards do they offer? If you want to make the most of your holiday shopping, you need to take a close look at the credit cards you have.

Some cards offer a flat rate refund; the Capital One Quicksilver card offers, for example, 1.5% cashback on every purchase.

Other cards offer different rewards for different types of purchases; The Alaska Airlines Visa Signature Card offers 3 miles / dollar for purchases in Alaska or Virgin America and 1 mile / dollar for all other purchases.

Other cards change the categories that receive the highest rewards; The Discover It card offers 5% cashback on categories that change every three months and 1% cashback on all other purchases.

If you’re looking to get the most out of your holiday spending, you need to know which of your credit cards offers the best rewards for each shopping category.

Does one card give extra points for purchases on Amazon? Maybe you want to buy gifts from Amazon Wishlists. Does the other card offer additional product points? You might want to bring cookies and napkins to a cool party. If you have a credit card that gives you the most points in restaurants, you can offer a holiday dinner away from home instead of a holiday dinner – and tell your friends that they can offer you their fair share of the bill.

This takes some planning and some work – if you have a Blue Cash Preferred card that offers 6% cash back on groceries, you don’t want to fill three carts with enough food for a large family and then accidentally pay for everything with the wrong card.

But if you have time to strategize, here’s how it can pay off:

  • $ 500 Grocery: $ 30 Blue Cash Preferred Card Refund
  • USD 500 on flights: 1,500 miles with a Visa Airlines signature card.
  • $ 500 on Amazon: $ 25 refund with Discover It card (if Amazon is the recommended category for this quarter)
  • $ 500 for purchases that do not qualify for the higher value reward category: $ 7.50 with Capital One Quicksilver Card

Your individual rewards will, of course, depend on which cards you have and how much you spend.

Method 2: use airline points and miles

If you’re trying to remember which card offers 6% cashback on groceries and which one offers 5% cashback on Amazon purchases, it seems like you’re adding another layer of stress to your holiday shopping, you could also earn significant rewards – and perhaps even free flight – put everything on the card of your preferred airline.

Most airline credit cards give you the highest percentage of points or miles when you shop with that airline, so use that to your advantage when booking your vacation travel.

Then, keep swiping the airline map for every other holiday purchase and watch those miles accumulate.

Let’s say you have a United Mileage Plus Explorer card and spend $ 900 on flights and $ 1200 on gifts, Lyft rides to the airport, whatever new clothes you bought for New Years, and so on. You will earn 2 miles per dollar for flights and one mile per dollar for other purchases, or 3,000 miles in total. This will give you about a third of the way to a free flight, depending on where you travel.

Yes, you can make a little less money than you would if you used the “top reward” method (depending on what credit cards are currently in your wallet), but due to the fact that we are irrational economists, you are probably You’d rather spend those miles booking a free flight than using a cash-back reward to charge a little off your credit card account.

Method 3: open a new credit card

Credit cards offer the highest bonuses to new users, which means that if you have enough account balance to open a new card, you can get some serious rewards.

What are the awards? It depends on the card. The Capital One Quicksilver Card offers a $ 150 cashback bonus if you spend $ 500 within the first three months of opening an account; The Chase Sapphire Preferred Card offers 50,000 bonus points – worth $ 625 on travel purchases if you redeem through Chase Ultimate Rewards – if you spend $ 4,000 in the first three months.

Opening a new credit card may lower your credit score a little, but if you are the type of person who pays off their credit cards in full every month, adding a new card can actually increase your credit score. You will have more credit available, but you will still be using about the same amount of credit every month, especially after the holidays are over, which means your loan utilization rate will drop and your credit rating could rise.

Unless you’re the type of person who pays all of their credit cards monthly, don’t buy another credit card. (Unless it’s a balance transfer card with a temporary 0% annual interest rate, which you only use to pay off your credit card debt as quickly as possible – but that’s another life hack for another time.)


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