There’s a little rule that I have when it comes to spending money: Never buy something for free.
What does that mean? It means that every time I make a purchase, I’m expecting to get something in return or be rewarded in some fashion.
That might sound crazy, but it’s something I’ve been doing for well over a decade now. It doesn’t matter if I’m buying a $1,000+ appliance or renting a movie from Redbox. I make sure to strategically do it in a way that results in thousands of dollars in cash or other freebies each year.
Here’s the strategy I use to make money every time I buy something, and how you can do the same thing with your next purchase.
Always Pay with a Rewards Credit Card
If you’re a rock star when it comes to using your credit cards responsibly and paying them off in full each and every month, then there’s a lot of money to made in rewards. These are points issued by credit card companies that can be used for things like cash back, gift cards, or even free flights and hotel stays.
Lots of cards will pay you cashback ranging from anywhere between 1 and 2 percent for all purchases. Several cards (like the Chase Freedom and Discover It Cash Back) also have revolving categories where the payout increases to 5 percent on select purchases every quarter (such as gas, groceries, etc.)
It’s pretty easy to earn lots of travel rewards too. You can find cards with flexible points (like the Chase Sapphire Preferred or Citi Premier) that will let you book travel to anywhere you want to go. Or if you have a favorite airline and hotel, some cards will reward you with points for those specific brands.
Strategically Earn Credit Card Welcome Promos
Another helpful way to earn rewards through credit cards is to take advantage of new customer introductory bonuses or promos.
This is typically where the credit card will offer some huge amount of points after getting your new card and meet some minimum amount of spending over the next 3 months or so. By signing up and making each of your purchases over the next few months count towards this bonus, you could be making a lot of money!
For example, when I signed up for the Chase Sapphire Preferred card, they were offering 80,000 Ultimate Reward points if you spent $4,000 within the first 3 months of usage. That’s a promo that’s worth $800 in cash or $1,000 in travel redemptions.
To ensure that I completed this task, I switched to making this card my primary payment method for everything. I carried it with me at all times, made it my default for online purchases through Amazon and Paypal, and even swapped it out as my payment method for my automatic bill payments. All of this effort was to ensure that I’d meet that spending requirement by leveraging as many of my usual expenses as possible.
Double Down with Shopping Rewards Apps
Credit card rewards aren’t the only way to get paid every time you spend money. There’s been a wave of new shopping rewards apps over the past decade that are offering huge incentives to shoppers when they use their service.
One of the most popular ones is (formally Ebates). This is a simple app you install on your web browser and it notifies you of deals every time you shop. This lets you earn a rebate for literally almost anything you can buy on the Internet.
Depending on the size of the purchase and the retailer, the reward might be anywhere from a few cents to a couple of dollars. For example, one time when I was booking some travel on Expedia, I earned almost $100 with Rakuten from just one purchase.
And here’s the best part: You can double-dip! Not only was I earning money with Rakuten, but I was also earning rewards points on my credit card. How cool is that?
Besides Rakuten, there are also a lot of other great shopping rewards apps you can try:
Find Discounts and Promos
Have you ever noticed a little box that says “promo code” on the checkout screen of most retailers? If you see this, then take one extra minute to do something that could save you a few bucks: Look for a coupon code.
Coupon codes are everywhere on the Internet. Dozens of websites regularly collect them and rank them by user feedback. All you have to do is find one, enter it into the promo code box, and then see if it worked or not.
There have been many times when I was in the process of buying something and paused to see if there were any promo codes available. More often than not, I can usually find one that gives me 10 percent off my balance or free shipping. Not bad for a few seconds of work!
If you’re already using one of those shopping apps that we mentioned earlier, then many of them will also provide you with a promo code if there’s one available. The app will generally apply it automatically, so there’s nothing needed from you. Very convenient!
Remember to Spend Responsibly
Earning credit card points and rebates can be fun. But it’s worth reminding you again that all of this only works if you spend responsibly.
Don’t buy things that you wouldn’t normally or try to manufacture purchases just to game the rewards system. This is a dangerous road to go down because it can easily lead to credit card debt that results in high interest payments. The last thing you want is to do is get in a position where you earn 2 percent cash back but have to pay the credit card 25 percent interest!
Therefore, remember to exercise as much discipline as possible as you make your purchases. An easy way to do this and make sure you’re not spending more than you should be is to use a budgeting app like Buxfer.
Buxfer keeps track of all your transactions and automatically categorizes them for easy review. You can monitor them from your phone or computer and always be aware of how much you and your spouse have spent.
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