New Cashback Websites With a Twist - Buy Nothing Extra and Get Cash Back

With the latest Internet trend of offering cash back, along comes a couple of new startup websites with a different twist.   Both sites are predicated on learning your existing purchasing habits, so as to gear specific offers based on where you already shop.  Targeted demographic information like that is extremely valuable to merchants, and they are willing to make it worth your while (in the form of cash or cash savings) to share where you buy your groceries or gas.  We will take a look at both sites.
Offermatic
Offermatic is a new cash back website that offers targeted 50% off coupons to merchants you already patronize.  At the initial level, this translates into $5 off a $10 purchase, offered every couple weeks.  At level 2, the deals get even better, with $10 off a $20 purchase.  There is even a 3rd level.  Users attain the higher levels by referring new customers, giving reviews of their shopping experiences and twittering about their deals.  I am only 5 referrals away from reaching a Level 2, so if this website sounds appealing, sign up via this link and I thank you.  They are offering an additional free $5 off $10 purchase at whatever merchant you use just for signing up.

Envaulted
Envaulted is another startup website that is currently in beta and is not open to new membership at this time.  However, one can get on a waiting list and as new membership slots open, you can receive an invitation to join.  It took me approximately 4 weeks to receive my invitation.  The business model for Envaulted varies slightly from Offermatic, but is intriguing.  Their pitch is simple.  Receive 1% cash back on all your credit card purchases, paid to youby monthly check.  Period.  End of Story.  Nothing extra to buy.They will even increase the cash back during limited time frames for featured vendors.  For example, this week, they offer 20% cash back on all Fandango purchases, and 3% cash back on all Whole Foods purchases.

Credit Card Registration - Both sites require registration of at least one credit or debit card through their secure website so they can analyze your spending patterns and preferred merchants.  This is usually the part that scares off most people; yet in actuality, it is all handled through Yodlee, the same company that Mint.com, Quicken and many of the top banks themselves use.  No personal information is ever requested, and they ask only for the last 4 digits of the credit card. If you currently use online banking, you are probably already using Yodlee's services without knowing it.
   I highly recommend both sites to those of you who feel comfortable with the business models of these firms.  As always, I welcome your comments and what your experiences have been.

Sam's Club Members - Ditch Those Discover Cards!

     Some friends of mine run a small business and purchase all of their business related items at Sam's Club. They asked me how they could save more by using my MaxCashBack methods.  I learned that they did have a Discover card, and were using this credit card (the only one accepted by Sam's Club) to make all of their purchases.  They thought that they were getting 2% cash back.
     I did a little research and learned that Discover has one of the least attractive cash back rewards systems of the major cards.  See my post earlier this month on Best Cash Back Rewards cards here.  To make a long story short, one does not even begin to earn 1% cash back on a Discover card until after $6000 in purchase have been made.
     So, what does a loyal Sam's Club member have to do to get the type of savings I routinely find with other merchants?  The light bulb finally went off in my head today.  USE A WALMART GIFT CARD!!  Because Sam's Club is owned by Walmart, all Walmart gift cards are honored by Sam's Club, both online and in stores.  These gift cards can be readily purchased at a discount (see how to do this and save 5-10% here). Better yet, these gift cards can be purchased using a good cash back rewards credit card like the Chase Freedom Visa card or the Fidelity American Express card through any of the gift card resellers.
     Now, Sam's Club members can realize big cash back savings like the rest of us, instead of settling for the 0.25-1% cash back rewards typically earned by Discover card holders.  Let me know in the comments below if you found this tidbit of information helpful.  Thanks!

Cash Back on Your Monthly Housing Costs?

   Just about everyone has a utility bill which comes in the snail mail or email each month.  It could be gas, or electricity, or a phone bill.  Recently I had an interesting experience with my gas company, Xcel Energy.  I had been paying my bill by direct debit, but they were in the process of changing from Checkfree, so I wanted to see what my options were.  Lo and behold,  I could pay by credit card! The gotcha was that they wanted a convenience fee.
   Now, most of the time the convenience fee for using a credit card outweighs any cash back savings.  But Xcel's fee was a fixed fee of $4.95, so the larger my payment, the smaller my percentage cost would be to pay by plastic. I happened to have a credit card that was giving me 5% cash back on every purchase, so I used that card to charge $400 to Xcel.  Cash back = $20.00  Convenience charge = $4.95.  Net utility savings = $15.05.  Not bad.
   Virtually every phone company now accepts credit cards without a fee (because the fee is already built into their rates!)  So do most car and home insurance companies. Why write a check when you can charge the fee, get an extra 25 days to pay, and get cash back?  Just remember, it never makes sense to charge for items that you cannot afford to pay for in full.


With tax season upon us, you might be wondering about cash back on taxes.  Well, as a matter of fact, that is a subject of a future post!


Happy shopping!

AARP Visa Rewards card - 5% back on everything

My new AARP credit card arrived this weekend.  Now, as a moderately aged young man, I will confess that I have been a member of AARP for some time.  In fact, I already have an AARP Visa credit card.

   So why did I order another one?  Because AARP is offering 5% cash back on all of my purchases for 6 months.  No spending caps.  No exclusions.  No small print.  Just 5% off everything you purchase.

   If you pay off your credit card every month like I do, then this is like giving yourself a 10% pay raise without having to grovel in front of your boss.

    Oh, and did I mention that the card is interest free for 1 year, just in case you can't pay it off in full right now?

   For those of you who do not qualify for AARP, well all I have to say is "Enjoy your youth!"

Help jump start this economy.  Get yourself this card and use it.  After 6 months, I will probably retire my card for good.  What about you?  Do you think this is a good deal?  Tell me your thoughts in the comments below.

The Best Cash Back Credit Cards as of March 2011

   The credit card landscape is a dynamic one.  Credit card offers come and go, terms change overnight, and it seems like benefits are constantly morphing.  So with that in mind, I bring you my opinion of the best cash back rewards credit cards available in the marketplace (as of this instant). I am also going to tell you what I DON'T like about each card as well.


    First, I would encourage you to read my previous post "Take a Reward, Any Reward".  It has sound advice for anyone looking for a credit card.  Personally, I truly believe that cash back credit cards only make sense if you pay off your balance in full every month.  Simply put, you have learned how to live within your means. Otherwise, my golden rule is to take any available funds and pay off/down whatever card charges the highest interest.  That will truly be the best cashback reward one can find.
   OK, here we go.  I first recommend that you look at your spending habits for the last year.  Do you drive a Humvee and eat out every night?  Do you spend your days hanging out at Sam's Club and cutting coupons?  Or do you travel extensively, and hotels are your homes away from home?  Knowing where your money is spent will give you a clue on what card is right for you.

   Rather than do a Letterman style list working backwards, these cards are ranked from more desirable to less desirable.

1.  Chase Freedom Visa: 

PROS:  5% cash back on categories that rotate each quarter.  1% on all other purchases. No annual fee. 2.7% foreign transaction fee. No limits or caps on any cash back categories.  Cash back redemption is available once you hit $50. Chase is currently offering a $100 sign up bonus, to be credited after $750 in purchases.  
CONS: Higher than average interest rate.  Balance transfer fees and period are not as generous as some other cards.  Rotating categories require enrollment each quarter or the 5% cashback benefits do not kick in.

SUMMARY:  Overall, if balance transfer options are not a top priority, this card offers the most consistently generous cash back rewards.  Factor in the $100 sign up bonus, and the cash back rewards % goes up considerably. This has been the #1 rated rewards card for several years running.

2.  American Express/Costco card: 
PROS:  3% cash back on all gas purchases up to $3000/year. 3% cash back on restaurant purchases, and generous 2% cash back for travel expenses with no annual caps. 1% on all other purchases, including purchases at Costco. Annual fee is waived if you are a Costco member, and the card doubles as a Costco membership card which lets you get rid of the redundant Costco membership card.  2.7% foreign transaction fee.
CONS:  Relatively high interest rate of 15.24%.  Balance and transfer fees are less generous than some cards, and do not offer 0% balance transfers. Cash back is paid annually by a check that can be redeemed at Costco.


SUMMARY:  My #1 credit card for gas, restaurant and travel categories and a great backup card to the Chase Visa Freedom card above.  A must for have Costco shoppers.  If I had to limit my credit cards to 2, it would be these two cards.

3.  Fidelity Investments Rewards American Express: 

PROS:  2% cash back on all transactions.  Cash back rewards go directly into an existing Fidelity Investment account, either savings, IRA or 529 Plan. No annual fee.
CONS:  Cash back earnings are not deposited into account until earnings reach $50 ($2500 in charges).  Must establish a Fidelity account in order to qualify for card.  No balance transfer provisions.  

SUMMARY: If gas, restaurant and travel are not big categories of spending and if you don 't frequent Costco, then this would be my #2 backup card to the Chase Visa.  I would use this card on all purchases when Chase is not offering the 5% cash back.

4. Pentagon Federal Credit Union Visa card: 

PROS:  5% cash back on all fuel purchases made at the pump (not inside the store?). 1% on all other purchases.  One must be a member of the Credit Union, but they make getting in fairly easy.  Check out options #8 and #9 on their list of ways to become a member. www.penfed.org.  Other perks include 2% foreign transaction fee (instead of the typical 2.7-3%) and a 2.99% balance transfer rate with a maximum fee of $250. No annual fee.  

CONS: Strict credit underwriting.  While it is the #1 cash back card for gas purchases, it's cash back features are unremarkable for all other categories. card.

SUMMARY:  If you know your gas pump more intimately than your spouse, then you need this card.  Also, if you are looking for a long term balance transfer loan at very good rates, or a card to use while abroad, this card could do the trick.  Otherwise, I would skip it.

5.  Discover More Credit Card.

PROS:  5% cash back rewards in categories that rotate quarterly, like the Chase Freedom card.  However, the categories differ each quarter from those offered by Chase.  Enrollment required each quarter.  Introductory 18 month 0% balance transfer offer is the best in the credit card field. Also, introductory 12 month 0% APR on all purchases.  No annual fee.  Using the Discover online mall to purchase items from designated vendors can increase the overall cash back benefits up to 20%.  Their online mall has the best cash back rewards of any credit card company. However, see caveats below.

CONS:  Cash back rewards start out at a puny 0.25%,  One must spend $3000 just to get to the typical 1% level, and these tiers reset every year.  Unless your credit card spending exceeds $8000/year, I would not recommend this as your primary credit card. Further, Discover caps your 5% earnings in most categories which can be quite frustrating. For example, the 1st quarter category of travel and restaurants is capped at $800 of spending ($40 cash back). All charges made at Sam's Club or any discount store is always limited to 0.25% cash back.

SUMMARY:  I must confess that I have a love/hate relationship with this card.  If you are a Sam's Club member, you need a Discover card, and this is the one.  Otherwise, I think I would recommend this only to folks who can charge substantial amounts on the card.  Use the card until you hit your category caps, then switch to one of the other recommended cards.  Of course, if you are interested in the balance transfer provisions, this card beats the rest. 
   After these 5 cards, the field gets pretty crowded with "me too" cards offering average terms or hidden gotchas.  If you do not have at least one of the above cards in your pocket, you are leaving good money (yours) on the table.  Call your credit card provider and see if they can switch your current card to one of the above.
   I welcome your comments and suggestions.  If you think I have missed something or are out in left field, let me and our other readers know.                                                       

Merchant Cashback Strategies: Lowes: How to Get 20% Off on Everything You Buy

With the advent of spring arriving, we will soon hear once again the roar of lawn mowers in the yard, the quiet digging sounds of new flowers being planted, and the rhythmic spit-spit sounds of sprinklers going off.  With that in mind, I thought that I would focus on Lowes, one of the two big box home improvement stores, and how to save almost 20% on everything you buy there. Impossible you say?  Then read on.

Step 1:  Pick yourself up some 10% off coupons on Ebay.  These are the coupons that are given out by the US Post Office on behalf of Lowes when someone changes their address.  There are folks who make a living collecting and reselling these lovely little goodies.  One can usually pick them up for an average of about $1.20-1.50 per coupon.  I save myself some time by looking for the "Buy Now" offers.  The current batch are good through May 15th, 2011, which should get you through the spring cleaning season. Make sure you get the coupons that are good up to $5000 in purchases, and you can save some serious money.  By the way, Home Depot and Ace often honor these coupons.

Step 2:  Sign up at Mr. Rebates.  I will explain why in a minute.

Step 3:  Get ready to purchase some Lowes gift cards at a discount.  They can be had for 7-8% off face value at Cardpool and Plastic Jungle. I have mentioned these websites many times, but if you haven't signed up yet, do it now.  Just click on the links.  While Visa Freedom card and Discover cards are offering 5% cash back on your purchases at home improvement centers starting April 1st, you can get a jump on them and get 7-8% instead by buying these cards.  If you are very clever, you will go through Mr. Rebates (see Step 2) to purchase your discount gift cards at Cardpool, thus nailing an extra 1%.  And if you have truly been following my advice, you will purchase those gift cards with your cash back credit cards, adding yet another 1-3%.  If you are not planning to buy online, make sure you buy the regular gift cards, NOT the electronic gift cards (which can only be used online).  Ohh, and for those of you who read this far, if you go through Mr. Rebates to purchase your coupons on Ebay in Step #1, you will get an extra 3% back on that purchase as well :)

Step 4:  Once you receive your gift cards, proceed to to the store, with your 10% coupon and gift card in hand, and smile when you get to the checkout counter, knowing you have just saved about 20% on everything you are buying.

There you have it. How to save 20% at Lowes all year long.


BONUS!!  I am trying to build my readership, as this Blog is new.  If you find this information useful, please subscribe to my Blog.  For the first 25 readers who subscribe to Cardpool and Mr. Rebates from this blog, I will send a free 10% off coupon to Lowes for purchases up to $5000.  Just send me a message via my personal Facebook page, so that I know where to send the coupon.

Sticker Shock at the Gas Pump?? Here's Some Help

  
With gas prices starting to approach $4.00 a gallon, I thought it would be timely to talk about how to save a little on your gas purchases.


Many credit cards offer cash back on fuel purchases, ranging from 1% to 5%.  Some of these cash back rebates are available only for a certain period of time. The better cards offer a fixed cash back percentage for fuel purchases, irrespective of the day or month that you purchased it.


The best credit card that I have found for fuel cash back rebates is from the Pentagon Federal Credit Union.  Their Platinum Rewards Visa offers 5% cash back all year long on fuel purchases at the pump, up to $3000.00, then it drops to 1%. One must be a member of the Credit Union, but they make it relatively easy to belong.  Credit standards for the card are strict.  There is no annual fee, and they offer 1% cash back on all other purchases as well.


The next best card is the American Express/Costco card, which offers 3% cash back on all fuel purchases, 2% on restaurants and travel, and 1% on all other purchases. There is no annual fee if you have a Costco membership.


The next 2 cards are similar in their features, in that they offer 5% cash back during prescribed time periods for their members.  These cards are the Discover More card and the Chase Freedom Visa card.  The Discover card has maximum cash back caps, while the Chase Freedom Visa card does not.


Now 3-5% cash back is not a lot of money, but every little bit helps in this day and age.  Know what card gives you the best cash back, and use it. 

Debit Card Users: Cash Back Rewards For You Too!

     Most of us are familiar with the cash back credit cards offered by the large financial institutions like Chase, Citibank, Bank of America, Amex and Discover. And this coming week, I will be featuring what I consider to be the best of those cards. However, did you know that debit card users can also take advantage of the cash back awards without having to get a credit card?

     This past week, I learned of a company called Perkstreet Financial, which is offering a debit card which provides cash back rewards on non PIN transactions.  And the rewards aren't puny either. 2% cash back on all transactions, with monthly featured categories that can get you 5% back.  For March, those 5% cash back categories are home supply stores, sporting goods stores, apparel stores, and tax preparation services.


     In addition, all of Perkstreet Financial's ATMs are surcharge free, and they are Federally insured through the FDIC. Check them out, and happy cash back rewards!

Who Is Paying for All These Cash Back Rewards?

What Are Credit Card Swipe Fees?

   Do you ever wonder who pays for all of the cash back rewards that are paid by the credit card companies?  Well, the answer is - you do!  The credit card companies and issuing banks charge fees to merchants for every credit card transaction, and the fees are based on the type of credit card being swiped.  Rewards cards exact the highest charge.  Of course, merchants try to pass on as much of that cost as the market will bear, and ultimately it is the consumer who is paying in the form of higher prices.  Since you are already paying, wouldn't it be nice to get some of it back?  The above article, written by Eva Norlyk Smith Ph.d., offers a fairly detailed explanation of how the system works, and who is calling the shots.

Merchant Cashback Strategies: Amazon.com

   Each week, I hope to feature an article detailing the best strategy I use for getting the maximum cash back from a particular merchant.  I have decided to start with Amazon.com, one of, if not the largest retailer on the Internet. During the holidays, Amazon's business soars, and so remember to bookmark this post for when you do your holiday shopping.

   

   Amazon is one of the few major Internet merchants for which there is not a cashback discount offered through any of the cashback portals that I recommend. 

So what options are there? 


   Basically, one has 2 options.

  1.  You can apply for the Amazon Rewards Visa credit card.  If you qualify, you will receive 3% cash back on all of your Amazon purchases, a $40 signup bonus, 2% back on gas station, restaurant and drugstore purchases and 1% back on everything else.  There is no annual fee, and the card carries a variable interest rate of 13.24% to 21.24%, depending on your creditworthiness.  Surprisingly, in my opinion, Lifehacker readers just last week voted the Amazon Rewards Visa as the best cash back Rewards credit card available in the market.  Perhaps it was because of the demographics of their readership, but I find the card relatively unremarkable.  To read the Lifehacker article, click here.

2.  The 2nd option is to purchase an Amazon online gift card Ecode through one of the gift card resellers I have recommended in my earlier blogs, such Cardpool or Plastic Jungle. My experience has been that Cardpool seems to more frequently offer the Ecodes and their discount runs 3%.  There are two other benefits to using this option.  First, if you use the Mr. Rebates portal to reach Cardpool and purchase your card or cards, the Mr. Rebates cashback discount brings the total savings to 4%.  The 2nd benefit is that you receive your gift card Ecode within a couple hours, and if you buy the gift card with a cashback credit card, the total savings can go up to 5-6%, depending on your cashback credit card.  A side benefit is that you do not have to ding your credit rating by having one more credit card in your wallet.  The one negative is that one does not get the onetime $40 signup bonus that the Amazon card offers. As I have recommended before however, do not buy more gift cards than you can use in the short term.  There will always be more available for purchase at a later date.

   The choice is yours, but I recommend using Cardpool via the Mr. Rebates portal.