Holiday travel and shopping can sometimes feel more like a one-two punch that takes a big bite out of your budget. So why not get money while you're spending money by using reward credit cards. Using the right rewards card, depending on what you buy, could earn you hundreds, if not thousands of dollars.
There is a dizzying array of rewards cards to choose from, each with different terms and conditions. Consumer Reports sifted through more than 90 rewards programs and came up with the cards that if you play them right can give the most in cash back and free goods and services.
The trick is to use two different cards for different kinds of purchases. Which two cards are best depends on how much you spend each month and what you spend it on.
For example, the LaCollas family, just starting out in life, are careful with their money.
The family says they're not going to change habits and go out and spend money when they don't need to, but when they do, it's nice to get cash back.
Consumer Reports recommends two cards for them: the BankAmericard Cash Rewards Card and Citicard's Double Cash. The first gives 3 percent cash back on every dollar spent on gas and 2 percent on groceries. Charge $500 in the first 3 months for a $100 bonus.
The Citicard will give you 2 percent cash back on all other purchases. The combo will net a couple who charge $750 a month about $650 over three years.
Consumer Reports says if you charge a lot, you may be better off with reward cards that do carry annual fees but offer more cash back and bigger bonuses.
For example for a family of four who charges $3,000 a month, Consumer Reports recommends the American ExpressBlue Cash Preferred Card and the Capital One Venture. The first gives 6% cash back on groceries and 3% on gas.
Use the Capital One Venture for everything else and get 2 mileage points for every dollar charged. Total rewards over 3 years equals more than $3,500 dollars.
Now keep this in mind. To get the maximum, keep in mind that the credit cards have to be paid in full each month or the interest and fees will eat away at your savings.
