Credit cards are a financial instrument that as a consumer we all use either to help finance an item or to receive some sort of reward for using a certain credit card. The Holidays presents us consumers with a fantastic opportunity to receive some sort of bonus depending on which credit card you are using for shopping for our loved ones. Below are some of the top credit cards depending on what your goal is this holiday season.
Best Cash Back Cards:
- The Chase Freedom card has rotating categories each quarter that allow you to save 5% for up to $1,500 in purchases. On top of this, if you utilize one of Chase’s online partners like Lowes, American Eagle, Abercrombie, etc. you can earn an additional 3% – 10% back just by using this card.
- The Discover Cash Back Bonus credit card also allows for 5% cash back on different categories of purchases that rotate frequently. This card resembles the Chase Freedom in terms of cash back and different categories so pick wisely.
- Lastly, is the Citi Dividend rewards card. This card, like the Chase and Discover card also allows for 5% but only for purchases made between Oct 1st and December 31st of 2012. Also they only apply to Macy’s, electronic stores, and toy stores. This is the least flexible card out of the other two but would be good to use of you like Macy’s.
- For those of us who don’t like to keep track of the ever rotating categories the Blue Cash Everyday from American Express allows you get 3% cash back at supermarkets, 2% at certain retailers, and 1% everywhere else. If you don’t like to track down the quarterly categories then this is the card for you.
These cards are going to be for people who want cash back or to save some serious money during the Holiday shopping season regardless of the store they are shopping at and will come in handy after the Holidays as well.
Best Store Credit Card:
- JC Penny has a great store credit card that will save you 20% off of apparel, shoes, handbags, and fashion jewelry. Also you can get 10% off of fine jewelry, watches, and home merchandise starting on the day you are approved for this card.
- Target has a store card called the Target Redcard that will allow for 5% off everything in the store. This can be used on those Black Friday deals to help you save even more money on items that have been discounted a lot. If you are a big Target shopper you should be using this card for additional savings.
- Kohls allows for massive savings too when you use their credit card. You can save 10% off your entire first purchase when you use the card. On top of this they send you coupons throughout the year, which can range from 15% – 30% off. This card would be great to use on Black Friday or during the holiday season to allow for the most savings possible. Like Target, if you shop at Kohls a lot you need to have to this card and start saving some money.
These store credit cards are best used for people who shop at mainly their store of choice. While these credit cards can be used outside of the store it makes the most sense to only use these cards when it will save you the most money at any particular retailer.
Best Extended Warranty Cards:
- The Citi Diamond Preferred credit card allows you to extend your manufactures warranty up to one year. There is also an introductory 0% APR for 18 months along with no annual fee.
- The American Express Blue Cash also allows you the ability to extend your manufactures warranty up to one year. This card also allows you to take back an item up to 90 days later regardless of the retailer’s return policy. You can also earn cash back with this card along with a 0% APR for the first 12 months.
Both of these cards would be best served by making a large purchase such as a major home appliance. It makes the most sense to sign up for this card and get the 0% APR then make the purchase that way you can finance the item for 0% and get an additional year’s worth of warranty overall a great deal for everyone involved.
Best Sign up Bonus Cards:
- The Blue Cash Preferred by American Express will give you $150 back if you make $1,000 in purchases within the first three months. Combine this with 6% from supermarkets and 3% back on gas stations you are a winner with this card. This card does have a $75 dollar annual fee attached to it so just make sure you are aware when you sign up for this.
- If you spend about $1,000 each month on your credit card then the Chase Sapphire Preferred card is the card that’s right for you. Chase will give you a $500 bonus that can be used as a statement credit or cold hard cash just for signing up. This card does have an annual fee of $95 per year but it is waived for your first year of membership.
- Finally is the Citi ThankYou Preferred Rewards card. Once you sign up for this card and make $1,000 in purchases within the first three months they will give you a $150 check. This card does not have any sort of annual fee attached to it.
A signup bonus card is right for anyone looking to get a new basic credit card without all the fancy bells and whistles but looking for some cash back that can be used during the holiday shopping season. Also make sure to pick a card that makes sense for you taking into account any applicable annual fees.
Best Cards for Holiday Travel:
- Rate by Money Magazine’s “Most Rewarding Card if you crave free airline flights” – Money Magazine, May 2011 the Capital One Venture Rewards credit card is for you. This card will give you two airline miles per one dollar spend during this holiday season. You can also get a $100 bonus or 10,000 bonus miles if you sign up and spend $1,000 within the first three months. If you are going to see a loved one and do some holiday shopping consider this card first. Also enjoy no blackout dates and the ability to fly on any airline with this card as well.
- If you are someone who prefers one specific airline then the Gold Delta SkyMiles card is for you. Enjoy a 30,000 mile bonus when you spend $500 within the first three months of membership. Also get double miles on all Delta purchases and one mile per dollar spent everywhere else. You’ll also enjoy priority boarding and discounts on in flight beverages and meals.
These two cards are meant for the frequent traveler and if you are going to travel and spend money shopping this holiday season then these two cards are meant for you and can save you some money now and later on when you redeem your miles.
Best 0% APR Cards:
As with any new credit card the issuer will give you a period of time ranging from 12 to 18 months of 0% APR on any applicable balance. To maximize your savings this holiday season I would suggest using one of the above listed cards for combined savings. That way if your goal is cash back you can get that along with 0% APR or how about an extended warranty you can get that as well with 0% APR. Always ensure to ask the agent helping you out to confirm the 0% APR or ask and they usually will add this to the card for you.
From the Experts:
Financial guru Jim Wang from Bargaineering.com recommends: If I were going to apply for a new credit card just for the holidays, I’d probably pick either one with 0% on purchases like the Citi Simplicity Card because you get 0% on purchases for 18 months. Otherwise, I’d pick one with a great promotional offer, like the Southwest Airlines card that gives you enough points for at least 2 free round-trip tickets on Southwest Airlines (we fly Southwest a lot). The Southwest Airlines card, like a lot of airline loyalty credit cards, does have an annual fee though.
Financial guru Phil Taylor from PT Money: “The credit card I see right now that is the most attractive for holiday shopping is the Discover More Card. Right now one of their rotating 5% cash back categories is “online shopping”. This is limited to $1,500, but that’s still under what people spend on gifts during the holidays. Using this card would put as much as $75 back in your pocket over the holiday season. The card has no annual fee and would make a solid reward card going forward. Another card that readers might consider is the Chase Freedom card. While it doesn’t have the 5% cash back on online shopping, it does include BestBuy in it’s 5% category. Plus, they are offering a $100 sign on bonus. This card has no annual fee as well.”
With all of these different cards you first need to sit down and think about what you want to accomplish this holiday season. Are you searching for cash back, or extended warranties, or air fare? Once you have that decided then start to look at all of the best of the best cards above. You should not go out and get every single credit card but find the best one that works for you and your financial situation. If you need help deciding talk it over with you friends or family and let them help you out.
Now it’s your turn, are there any cards that you know of that was missed here? Do you have any suggestions on how to maximize your credit card during the holiday season? Let me hear from you.
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