Unlocking the Power of Credit Cards: A Savvy Spender’s Secret to Saving
As a self-proclaimed frugal enthusiast, I’m often asked how I manage to save money while still enjoying life’s luxuries. My answer may surprise you: credit cards. Yes, you read that right! By strategically utilizing credit card points, perks, and rewards, I’ve been able to save thousands of dollars on essential purchases.
Maximizing Points and Rewards
To get the most out of my credit cards, I switch between them depending on the purchase. For instance, I use a travel card for flights, hotels, and dining, earning 5x the points per dollar spent. For shopping, I opt for a cash back card, which gives me 1.5x the points per dollar spent. And for groceries and gas, I use another cash back card, earning 5x the points per dollar spent. But that’s not all – my cards also offer rotating “deals” every few weeks, allowing me to earn up to 15x the points on specific purchases.
The Power of Combining Points
By having multiple cards through the same bank, I can combine my points and redeem them for airline miles, credit on my bill, or even purchase flight tickets. I’ve found that redeeming my points for airline miles yields the most value, saving me an average of $600 per roundtrip ticket. Over the past two years, I haven’t paid for a plane ticket, accumulating a total savings of $4,100.
Insurance and Perks Galore
Many credit cards come with built-in insurance and perks, such as credit for Global Entry or Netflix. I’ve used my card’s $95 Global Entry redemption to apply and receive Global Entry for free, saving me $200 on rental car insurance and roughly $500 on baggage, cancellation, and other travel insurance. This coverage has been invaluable, especially during the COVID-19 pandemic.
Cash Back Rewards and Savings
My credit cards also offer cash back rewards for specific companies. For example, I can activate 10% savings on an Audible purchase or 5% for an AirBnB booking. These rewards change every month, but I’ve found it useful to regularly check them, saving me an additional $500 over the past two years.
Total Savings and Takeaways
In total, I’ve saved roughly $5,395 over the past two years by utilizing credit cards more strategically than cash or debit cards. While this method may not work for everyone, I encourage anyone to explore their credit card perks and consider switching to a card with benefits that align with their lifestyle. Remember, it’s all about being mindful of your spending habits and making the most of your credit card rewards.
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