How to Get 5% Cash Back on Holiday Purchases
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How much did you spend during the holiday season last year? How much will you spend this year? Think for a moment.
Perhaps you’ll spend $500-$1000 on gifts?
And what about food and clothes?
Whether you’re kicking off the season by hosting Thanksgiving or just bringing appetizers to holiday dinner parties, you may spend an extra $300 on food. A new outfit for New Years Eve along with tickets to a show or two during the holiday season will run about $200. And travel? If you have to travel anywhere, you’re looking at $50 for a tank of gas (at least) and upwards of $2,000 if you’re buying plane tickets for your whole family.
The reality is that the holidays cost a lot of money.
Thankfully there are 5% cash back credit cards that will ease the strain on your wallet this season. (Or at least give you a boost in your cash reserves in January when you’re able to redeem the rewards.) If you spend $3,500 during the holidays on a 5% back card, you’d be entitled to $175 in cash back rewards. Even if you just spend $500, with a 5% rewards card you’ll get $25 back.
So before you head out to purchase gifts (and dinner party supplies, and a new outfit, and plane tickets), consider picking up one of these top 5% cash back rewards cards for the holiday season.
When I think of Christmas shopping, I immediately think of Target. This is because as a kid I would save up my money and my parents would let me visit Target by myself and buy presents for everyone. (For several years my present of choice was a one dollar box of mint holiday cookies.) Target has gifts for everyone on your list — from clothes to electronics; plus with groceries in many stores you’ll also save 5% on food for the holidays.
- 5% off (Note that this is an immediate discount, not a typical cash back reward where you have to redeem it.)
- Free shipping on Target.com
- Extended returns (You get an additional 30 days to return an item.)
Blue Cash Preferred® Card from American Express
If you’re hosting Thanksgiving, a New Year’s Dinner, or a party anytime in between, you’ll likely be paying a pretty penny for food. Thankfully, the Blue Cash Preferred® Card offers 6% back (yes, that's 6%, not 5%) at US supermarkets on up to $6,000 per year in purchases (then 1%). For those traveling by car during the holidays, this card also offers 3% back at US gas stations. Shopping at select US department stores also gets you 3% back. Cash back comes in the form of Reward Dollars, which can be used towards statement credit.
Sign up for this card now to receive their generous sign up bonus of one year of Amazon Prime plus $100 statement credit after you spend $1,000 on purchses on your new card within the first three months. You'll also get some relief with their 0% Intro APR on purchases and balance transfers for 15 months (after that, your APR will be a variable 12.99%-21.99% based on your credit. There is a $75 annual fee for this card.
- Get one year of Amazon Prime plus $100 back after you make $1,000 in purchases with your new Card in the first three months.
- You will receive $100 back in the form of a statement credit.
- Hassle-free cash back: no enrollment required, the same great reward categories year-round.
- Earn Cash Back: 6% US supermarkets up to $6,000 per year in purchases, 3% US gas stations & select US dept stores, 1% on other purchases. Terms and limitations apply.
- Cash back is received in the form of Reward Dollars that can be redeemed as a statement credit.
- 0% intro APR on purchases and balance transfers for 15 months, then a variable rate, currently 12.99% to 21.99%, based on your creditworthiness and other factors.
- Terms and limitations apply.
Discover it® Card
Would you rather avoid the holiday lines on Black Friday, Christmas Eve, and every other day in between by shopping online? If you prefer shopping online, then use (or apply for) the Discover it® card for your holiday season shopping. Get 5% cash back for categories that rotate every quarter when you sign up for 5%. (The current categories for October through December 2014 are online shopping and department store purchases.) The 5% back is limited to $1,500 in purchases. You can also get up to 20% cash back with over 200 retailers through Discover's online shopping portal.
The card currently offers 0% Intro APR for 14 months on purchases and balance transfers (then a variable APR of 10.99%-22.99%). You also get a free FICO® Credit Score each month so you can monitor your credit.
The Chase Freedom card gives 5% back on quarterly rotating categories as well. Note that the 5% back is limited to $1,500 in spending (so $75 cash back) each quarter and you must enroll your card for the rotating rewards each quarter. (Enroll via a reminder email or online.) Chase also has an online shopping portal that gives you extra cash back when you shop through Chase.
No matter what your plans are for the holidays this year, there’s a card that can help you earn 5% back.
Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved or otherwise endorsed by any card issuer.