For Prime members who regularly shop on Amazon, it’s a no-brainer to apply for the Amazon Prime Store Card, which gives you 5% back on all eligible purchases. The card has no annual fee, though a Prime subscription is $99 a year.
If you have the card, here's how to make the most of it.
Put everything you can on the card
With the card giving you 5% back at Amazon, you'd be wise to buy everything you can there. Plan your regular purchases — such as baby products, paper goods, pet supplies, laundry detergent and so on — so that you’re earning 5% back all the time.
Rewards come in the form of a statement credit. If you spend $200 a month, for instance, you’ll be getting $10 worth of statement credit each month.
And of course you’ll want to use your card to buy big-ticket items such as TVs, video game consoles or furniture to get an even larger statement credit, plus the free shipping that saves you from having to lug them home. Large items aren't eligible for two-day Prime delivery, but shipping is still free.
Make the Amazon Prime Store Card your default payment method on Amazon, and you’ll earn rewards steadily.
Use Dash Buttons
Prime shoppers who know exactly which products they buy regularly should check out Amazon’s Dash Buttons. For $4.99, you get a Wi-Fi-enabled gizmo that places orders for you. For example, you can buy the Tide Dash Button and attach it to your washing machine. When you’re running low on laundry pods, just push the button, and your order is placed on Amazon.
You get a $4.99 statement credit for each Dash Button the first time you press it, essentially making the button free. Dash Buttons are available for household items, health and personal care products, pet supplies, groceries, and kids' and baby needs.
Pay the bill in full each month
Paying your balance in full is good advice no matter which credit card you use. But there's an added incentive to do so for the Amazon Prime Card. When you don't carry a balance, you don't pay interest — and as of November 2016, the stated APR was a whopping 26.24%. Compare this with general credit cards: As of the second quarter of 2016, the Federal Reserve reports that the average interest rate on credit cards is 12.16%.
The Amazon.com Prime Store Card offers several 0% financing deals for larger purchases. Instead of 5% back, you can choose:
6 months of special financing (0% interest) on purchases of $149 or more.
12 months of special financing (0% interest) on purchases of $599 or more.
24 months of special financing (0% interest) on certain items.
These 0% offers are actually "deferred interest." That means interest is being calculated in the background, but it's not showing up on your statement.
If you pay off the purchase before the 0% period is up, then there's no problem: You won't pay any interest. But if you still have a balance at the end of the period, you'll be charged the full amount of interest on the entire purchase, not just what's left over. If you choose special financing for a purchase, be absolutely sure you can pay it off in time.
How to redeem rewards on the Amazon.com Prime Store Card
You don't have to do anything to get your 5% back. According to Amazon, "5% Back is automatically applied as a statement credit within two billing cycles." So if you earn $15 in rewards, for example, you'll automatically have $15 knocked off your balance within a couple of months.
There are a few alternatives to the Amazon Prime Store Card, including an Amazon-branded Visa card and some general cards that occasionally offer bonus rewards on Amazon purchases. If you’re a loyal Amazon Prime member, though, your best bet is the Amazon Prime Store Card.