Holiday shopping is in full swing, and there are certainly great deals to be found everywhere this year. However, you can save even more money if you shop for those deals with the right rewards credit cards in hand. In fact, in some instances you can even receive an additional 25% in discounts! So before you hit the shops this year, make sure you know what discounts and rewards are offered by the credit cards you already carry in your wallet. Or, consider applying for a new rewards credit card to maximize your holiday savings. Here are some of our favorites if you're already on the hunt:
6 Best Rewards Credit Cards for Holiday Shopping
1. Blue Cash Preferred® Card from American Express
Check out our review of the Blue Cash Preferred® Card from American Express for the latest updates on this cash back card from AmEx.
2. Chase Freedom
Check out our review of the Chase Freedom Card for the latest updates on this cash back card from AmEx.
3. Discover More
(Update: This offer is no longer available.)
With the Discover More Card you can make purchases in rotating categories to earn 5% cash back. During the holiday season, restaurant and fashion purchases return 5% cash back. Unfortunately, you can only earn cash back for up to $300 in purchases. You also have to sign up each quarter for the program or you will not be eligible to receive the discounts. However, as long as you spend at least $3,000 annually on the card, you automatically receive 1% cash back. The Discover More card has no annual fee, and the standard APR falls between 11.99% and 20.99%. My favorite thing about the Discover More card is the ShopDiscover option. Cardholders can visit the ShopDiscover mall and then click through to certain retailers to earn additional discounts of up to 25%. You can also earn more cash back when you use the gift card redemption options. However, if you tend to carry balances on your credit cards after the holidays, applying this cash back to your existing balance can save you a lot more money in the long run. Keep in mind that many retailers don't accept Discover cards, especially outside of the United States. This may make it challenging to earn cash back rewards in some instances.
4. Target REDcard
The Target REDcard is unique and most valuable to frequent Target shoppers. This card doesn't have a lot of features, but it offers straightforward savings: Use your Target REDcard for anything you buy at Target and receive 5% off your purchase. This is not a cash back rewards program; this is 5% taken off of your purchases at check-out. This simple and convenient program means you don't have to redeem anything. However, these cards usually have low credit lines - my Target REDcard has a limit of $500, and despite repeated requests on my part my credit line has not been increased. The savings can still add up though if you shop frequently at Target. This card has no annual fee, and the standard APR ranges from 13.25% to 22.9%.
5. Chase Sapphire Preferred Card
Update: This offer is no longer available. Check out the Chase Credit Cards page to view Chase cards that are currently available.
The Chase Sapphire Preferred Card is offering 50,000 bonus points to new cardholders that spend $3,000 during the first 3 months of use. If there's any time of the year you can hit the spending threshold, it's now! In addition, you can bank double rewards on all your travel and dining out this holiday season while still earning one point per dollar spent on everything else. The annual fee is a bit steep at $95, but it's actually waived for the first year of membership. You will also earn an annual points dividend which is based on 7% of your earned points, and you can rest assured that those points will never expire before you're ready to redeem them.
6. Citi Dividend World MasterCard
(Update: This offer is no longer available.)
This card has many similarities to the Discover More card; however, you receive an upfront bonus and also have the added benefit of being able to use a MasterCard almost anywhere. In addition, with the Citi Dividend World MasterCard, you can receive $150 cash back if you make at least $750 in purchases within the first three months of receiving the card. Citi also offers rotating shopping categories throughout the year, and you can receive 5% cash back for shopping in these categories. Purchases at department, clothing, electronic, and toy stores from now through the end of the year all qualify, and you'll receive 1% cash back for all other purchases with no minimum spending limit. You can earn up to $300 in dividend rewards each calendar year. This card has no annual fee, and the APR ranges between 15.99% and 22.99%.
Supplementing your shopping with one of the best cash back credit cards can really pay off during the holiday season. However, if you lose track of your budget and overspend, your savings will quickly diminish when balances are carried over into January or beyond. So while it's smart to take advantage of all the great cash back deals, make sure you never carry a balance on your credit cards or pay any interest. Adjust your spending habits as necessary, save wherever you can, and get rid of unnecessary credit card balances to make sure you save the most money possible during this holiday shopping season. How do you plan to maximize cash back programs this year? Do you have a favorite rewards credit card for your holiday shopping? If so, let us know which one and why you love it in the comments section below.
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