5 Ways to Capitalize on Your Credit Cards

This Financial Planning Month, plan to use your credit cards to your advantage. No matter how much you try to avoid them, we all use credit cards sometimes. Having money set aside for unplanned expenses is one way to avoid overspending on your card. Here are some credit card tips and tricks from Bank of America’s Better Money Habits so when you do use your card, you can earn cash back and receive rewards on some of your transactions.

  1. Only open credit cards if necessary.

While it’s great to earn rewards, points and cash back on a credit card, don’t open unnecessary accounts. Your credit score is affected each time you apply for a new line of credit because the lender pulls your credit report with a “hard inquiry.” The more credit cards you use, the more bills you’ll have to monitor. Practice good savings habits so you won’t have to rely on credit cards.

  1. Choose a card with cash back rewards.

Did you know you can receive cash back on some of your purchases? If you’re someone who uses your credit card routinely to cover day to day expenses like lunch at work, gas for your car or utility bills, you might want to enroll in a cash back program so you can earn money when you swipe your card.

Contact your current credit card lender to see if they offer cash back rewards. You may be able to upgrade from a basic card to one that offers benefits with the same provider. If you’re not able to upgrade your card, consider limiting your spending on this particular card since there’s no reward for using it.

When you begin receiving cash back, try not to overspend in hopes of earning money in return. You’ll still have to pay your credit card bill with added interest, so a few dollars back is not worth an oversized credit card statement at the end of your billing cycle.

  1. Are you a budding world traveler? Get a travel rewards card.

With the right rewards card, you can earn enough points to cover your next flight or hotel stay. Your travel rewards card might offer flight and hotel upgrades, roadside assistance, and protections in case you lose your luggage, experience travel delays or have a medical emergency on the road.

Be sure to compare your options before signing up for a card. You can choose a general travel rewards card that accrues points on regular, non-travel related card usage; or you can choose an airline or hotel specific card that only earns points when you book travel specifically through them.

If you choose the latter, be sure to calculate the amount you have to spend before actually earning enough points for a trip. If it’s a large amount, you’ll be better off with a general travel rewards card.  

  1. Consider earning points when you shop at your favorite store.

If you’re obsessed with shopping at a particular store or website, consider opening a credit card with them. Some retail stores offer discounts as soon as you open your account. Others incentivize your shopping by providing rewards as you spend.

Having a credit card at your favorite store is a great way to earn rewards from your usual spending, but don’t overspend just because you have a card. Be sure to double check the terms and conditions like the interest rate before signing up. >> Learn five ways you can save while you shop.

  1. Use your lowest interest credit card for large purchases.

Planning for a large expense can be stressful, but if you've been saving money you can use some of your savings instead of relying on your credit card.

If you do have to use your card, be sure to use the one with the lowest interest rate for any of your large credit card purchases. This way, you won’t be charged an arm and a leg in interest when it’s time to pay back on your card. >> Learn about how interest rates affect you.


Let America Saves help you save money. It all starts when you make a commitment to yourself to save. Take the first step today and take the America Saves pledge to save money, reduce debt, and build wealth over time. And it doesn't stop there. America Saves will keep you motivated with information, advice, tips, and reminders to help you reach your goal. Think of us as your own personal support system.

TAKE THE PLEDGE


#FinancialTip: Save money so when you have an unplanned expense you can use your own savings to pay for it. But when you actually have to use your credit card, here are some tips to use it to your advantage. v/@AmericaSaves! http://bit.ly/2QvipU4 

   Tweet this now 

Take the Pledge

I pledge to save money, reduce debt, and build wealth over time. I will encourage my family and friends to do the same

Take the America Saves Pledge

Tip of the Day

  • Written by Katie Bryan | November 26, 2013

    Let this be the year that you put an end to bringing in the New Year with financial guilt and stress.  http://ow.ly/rcJIn 

Saver Stories View all »

Developing a Savings "Game Plan"

Written by Katie Bryan | October 28, 2013

Eunice Diaz, a teacher in Colorado Springs, had been noticing a pattern. Despite the fact that she and her husband were “making good money,” they were spending their entire earnings and “were still struggling at the end of the month.”

Read more...

Inspired to Build Savings By Starting Small

Written by Great Lakes Michigan Saves | April 19, 2016

With little-to-no money in the bank and living on a limited income with her adult daughter, Sharon wasn’t sure if building up savings for her future was even possible. “At my age, to put debts behind me would be a relief,” she said, but she wasn’t quite sure how to even get started with a savings plan. That all changed when Sharon attended the Great Lakes Michigan Saves Pay Yourself First Saver’s Summit during America Saves Week.

Read more...

Starting and Continuing a Personal Finance Journey

Written by Sara Cooper | December 23, 2013

When Kiara Hardin, now a junior at Western Illinois University, became an intern with the Chicago Summer Business Institute during her sophomore year of high school, she began her personal finance journey. The program required participants to open a savings account.

Read more...

Receive Updates

Sign up for Texts

Written by Tammy G. Bruzon | July 15, 2014

Sign Up

Sign up for Emails

Written by Super User | September 16, 2013

Get Emails

Take the Pledge

Written by Super User | September 16, 2013

Start Saving