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Cash Back Strategy – 4th Quarter 2016

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Well folks. It’s a new quarter and that means a new rotation in my cash back strategy.

A few things have changed since last quarter. I’ve added three new cards: Citibank’s Costco Visa, Chase’s Amazon Visa, and another American Express card, the SimplyCash Business. Here are the benefits of each card:

The benefits of the Amazon Visa: Earn 3% Back at Amazon.com, earn 2% Back at gas stations, restaurants and drugstores, and earn 1% Back on all other purchases. To boot, they gave me a $70 gift card for signing on. Not a bad deal.

The benefits of the Citi Costco Visa: Earn 4% back on gas, 3% back on travel and restaurants, 2% on Costco purchases, and 1% on everything else. The only offer I received upon signing up was a free back of bottle water. Not complaining.

The American Express SimplyCash Business card was something they kept mailing me offers for so I signed up on a whim. And I got it. To boot, I get a $300 statement credit after spending $3,000 within three months. They have rotating categories like my Chase Freedom and Discover It, but for more business related items. You get to pick on category that you’ll always get 5% back on PLUS you get to pick a second item you can get 3% back on. I chose my wireless bill and restaurants respectively. I can pick another 3% category in a few months, like office supplies or travel. I’ll most likely stick with what I’ve got.

I could have gone with the Costco card for restaurant spending, but the quirk about Costco’s cash back features is that they only give you cash back once a year in the form of a check. I’ll have to check more on this because I don’t receive statements by mail so I hope they send some kind of email notice about the cash back check so I’m on the lookout for it (I’m terrible about checking my mail). I personally like getting the cash every month and see my dollars stack up.

In order for me to remember which credit card is offering what and when, I keep a note and carry only those cards on me to make my purchases. I do this because of the cash back rewards, which I use to build up my savings and investments

Below is my credit card strategy for this quarter:

Credit Card Rewards October – December 2016

Card Cash Back Stores
Chase Freedom

5%

Drug Stores, Costco, Department Stores
Discover It

5%

Amazon
AMEX BCEP

6%

Grocery Stores
Costco Visa

4%

Gas Stations
AMEX SimplyCash

3%

Restaurants
AMEX SimplyCash

5%

Cell Phone Bill
AMEX Schwab

1.5%

Everything Else

Though I now have the Amazon Visa card that gives me 3% cash back on all Amazon purchases, Discover’s It card has a 5% cash back offer, which is a better deal. It’s going to come in handy for the upcoming holidays.

Again, it can’t be said enough. If you’re not responsible with credit cards. This isn’t for the faint of heart. You can only spend what you can afford to pay off when the bill comes due. If you’re budgeting correctly and tracking your expenses, you can pay your everyday bills and expenses on credit cards and enjoy the benefits the products have to offer. That usually means extended manufacturer’s warranties, rental car insurance, airline miles, and of course, cash back. They key is to be wise, smart and stick to your plan.

Yes, a few of my cards of annual fees, but the cash back I earn is more than enough to cover it. I know the credit card companies offer this hoping that it’s customer’s run a balance and pay them interest. That’s not the game I’m going to play however. I pay my bills in full when they are due because I live below my means and use credit responsibly.

As long as credit card companies continue to give away free money, I’ll take advantage of it. I’m able to stack more dollars with this strategy.

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