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Months into the COVID-19 pandemic, your habits and budget may have somewhat adapted to “the new normal." But questions still remain unanswered as we step into August.
While the status of schools, unemployment benefits and more remains uncertain and out of your control, you can direct your spending in a positive way and earn as much value as possible on obligatory purchases.
Here are our credit card tips that can put money back in your pocket and help you spend safely this month.
Make the most of back-to-school (or at-home-learning) purchases
Whatever school ends up looking like this semester, expect a lot of demand for laptops and computer accessories to accommodate learning needs in the pandemic.
Parents with children in elementary through high school plan to spend an average of about $789 per family on supplies this year, according to an annual survey by the National Retail Federation and Proper Insights & Analytics. For college students and their families, the projected amount is about $1,059 per family.
Whether you’re planning for at-home or in-school learning, you can optimize your purchases in the form of rewards or low-interest offers. And if buying electronics is not an immediate need, you might find even bigger discounts online if you hold off until Black Friday.
Think twice about deferred interest promotions
Pay close attention to the terms of store credit cards, which often advertise “special financing” or “no interest if paid in full” over a certain period. This is what's known as a "deferred interest" offer, and it means that if you have a leftover balance when the promotional offer ends — no matter how small that balance — you’ll be charged interest for the entire amount of the transaction, retroactive to the original purchase date.
It’s not the type of surprise you want to deal with in this uncertain climate, so if you need to finance a large purchase upfront, a true 0% intro APR offer is a safer option. With these offers, interest is fully waived (not deferred) during the promotional period. And if you don’t finish paying it off at that time, you’re charged interest only on the remaining balance going forward.
Leave no rewards behind
Rewards can add up, especially if you’re making large purchases. When shopping for back-to-school items, look beyond your credit card’s rewards structure for opportunities to earn. Your card’s app may offer opportunities to save. AmEx Offers and Chase Offers, for example, give discounts for purchases made with qualifying merchants. When you redeem an offer, the savings are applied to your account as a statement credit.
Another option is to shop through an online cash-back website that rewards you for purchases made with eligible merchants. And if you pay with a rewards credit card through these sites, you can stack your earnings.
The Citi® Double Cash Card – 18 month BT offer, for example, earns 2% back on purchases — 1% when you buy and 1% when you pay it off. If you use that card to make a purchase on a cash-back website, you'll earn rewards via Citi on top of whatever rate that shopping portal is offering.
Inspect your credit cards for new offers
Some credit card issuers continue updating their rewards structures, redemption options and other features in light of the shift in household spending due to COVID-19. Check your inbox for updated terms that can potentially lend more value for everyday purchases. If you have one of these cards, for example, you can earn elevated rewards in certain categories:
Marriott Bonvoy and Ritz-Carlton cards: Through Sept. 15, 2020, eligible cardholders who opt in can earn 10 points per dollar spent on up to $3,500 in purchases at restaurants and gas stations combined.
U.S. Bank Altitude™ Reserve Visa Infinite® Card: Through the end of 2020, cardholders can earn 3 points per dollar spent on dining. They can also apply their annual $325 travel credit toward dining purchases.
Keep payments contactless when possible
Many cards have added contactless payments as an option that can be used at terminals. It’s especially efficient when you’re trying to avoid contact with surfaces and people. You can tap your credit card at a payment terminal instead of inserting it, swiping it or handing it to the cashier.
If your credit card offers this option, it will feature an icon that says so — a group of small lines that resemble a Wi-Fi symbol. Not all terminals are equipped to process these payments, so you'll have to spot those same lines on the terminal to determine whether it accepts contactless payments.
Another payment option, if the terminal accepts it, would be a mobile wallet like Google Pay, Samsung Pay and Apple Pay. You might even rake in additional rewards for those purchases. The U.S. Bank Altitude™ Reserve Visa Infinite® Card, for example, earns rewards in several categories, and it also offers 3 points per dollar spent via a qualifying mobile wallet. The Apple Card, too, offers bonus rewards when you use the virtual card via Apple Pay.