With much of the country enveloped by a punishingly cold polar vortex, this is the perfect time of year to stay indoors, get some financial tasks done and take part in a money-saving challenge.
So throw on a sweater, unsubscribe from those marketing emails that try to persuade you to buy stuff you don’t need, and get ready to tackle your tax return.
And when you’re done, make yourself some hot cocoa. You deserve it.
Make tax time easier
Tax Day isn’t until April, but W-2s, 1099s and other tax forms arrive in your mailbox by February. That means it’s time to assemble the necessary information to start doing your taxes, and your credit card can help keep you organized.
Gone are the days of hauling out a box of crumpled receipts and trying to make sense of where your money went last year. If you opt to itemize your deductions, many credit cards provide a year-end summary of your spending. It not only helps you see what you spend the most on, but it also helps you quickly identify any tax-deductible items like medical expenses and charitable contributions.
If you operate a small business, you can deduct some work-related expenses, along with business credit card fees and interest payments. The year-end summary for your business credit card is an invaluable resource for finding deductions.
Participate in Frugal February
An intrepid group of Nerds is embarking on a nothing-but-the-essentials spending challenge for February. Obviously, it’s tough to spend nothing for 28 days, but you can give Frugal February a try by setting a goal that’s attainable for you. That might mean buying only the absolute essentials, carpooling to work to save on gas or cutting out mindless online shopping. If you’d like accountability buddies or support when the urge to spend strikes, join in on the conversation with the NerdWallet community.
When you do need to spend money this month, use a credit card that will maximize your rewards. Earn more cash back on the necessities with these cards:
- The Blue Cash Preferred® Card from American Express earns 6% cash back at U.S. supermarkets, on up to $6,000 a year in spending (then 1%); 6% cash back on select U.S. streaming subscriptions; 3% cash back at U.S. gas stations and on transit (including such things as taxis, rideshares, parking, tolls, trains and buses). Terms apply. If the $95 annual fee doesn’t count as “essential spending” for you, consider this card’s no-fee counterpart. The Blue Cash Everyday® Card from American Express earns 3% cash back at U.S. supermarkets on up to $6,000 in spending per year (1% after that) and 2% cash back at U.S. gas stations. Terms apply. Both cards earn 1% back on all other purchases and come with welcome offers for new cardmembers.
(All information about the Blue Cash Everyday® Card from American Express has been collected independently by NerdWallet. The Blue Cash Everyday® Card from American Express is no longer available through NerdWallet.)
- With select Discover cards like the Discover it® Cash Back and the Discover it® Student Cash Back, you’ll earn 5% cash back on up to $1,500 spent at grocery stores through March 31, 2019 (when you opt in). All other spending earns 1% back. For new cardmembers, Discover will match ALL the cash back you've earned at the end of your first year, automatically. There's no signing up. And no limit to how much is matched.
- Commuting costs and prescription medications are unavoidable expenses. With the Chase Freedom®, through March 31, 2019, you can earn 5% cash back on up to $1,500 in spending at gas stations, on tolls and at drugstores (activation required). All other spending earns 1% back.
- It’s way too easy to overspend on Amazon.com, but sometimes you need it for those must-have purchases (looking at you, diapers). With the Amazon Prime Rewards Visa Signature Card, you can earn 5% back on Amazon and at Whole Foods, along with 2% back at gas stations and drugstores (and restaurants, too, in case you allow yourself a cheat day).
Oh, and don’t forget your Valentine
Even if you’re being frugal this February, it doesn’t mean you can’t find ways to show your loved ones that you care. Grab some chocolate or roses with your go-to grocery store or drugstore card, or treat your boo to dinner out with a card that rewards restaurant spending.
One of the Nerds’ favorites is the Capital One® Savor® Cash Rewards Credit Card, which pays a positively romantic 4% cash back on dining and entertainment.
Don’t want to commit to an annual fee? The Uber Visa Card also offers 4% cash back on dining out. Its sign-up bonus isn’t as lucrative, but just like in romantic comedies, sometimes the underdog wins out.