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    How To Use Credit Card Rewards To Cut Down Spending

    Man gets refund on credit card

    Many credit cards feature reward programs that refund you a percentage of your purchases in the form of points and discounts. Some of them can actually be used to reduce your online shopping bill.  

    If you’ve been shopping online more than usual over the past few months and enjoying the safety and convenience of home delivery, here’s some more good news. Credit cards like Discover it® Cash Back and Capital One’s Venture® Rewards Credit Card can be used when shopping on Amazon and paying via Paypal, two of the biggest names in ecommerce today. 

    To help you save money on your online purchases, let’s take a look at the rewards offered by these two cards and how you can use them to your benefit. 

    Discover it® Cash Back        

    If you have a high credit score and make a lot of online purchases, this card could be an excellent choice. Its competitive rewards program includes a cashback option that you can use toward Amazon purchases. 

    • This card is marketed at customers with a high FICO score and has no annual fees. The standard APR varies from 11.99% to 22.99%
    • You’ll receive 5% cashback on purchases at selected retailers, up to a quarterly maximum. After this threshold has been reached, you’ll receive 1% back on subsequent purchases 
    • At the end of your first accounting year as a cardholder, you’ll receive a bonus amount that’s equal to your cashback rewards for the past 12 months

    In addition to using your rewards for Amazon purchases, you can also use them when paying with Paypal at millions of merchants worldwide. 

    Capital One Venture® Rewards Credit Card         

    While this card caters primarily to frequent travelers, it can also be used for online purchases. Amazon currently offers the option of reducing your total bill by using Capital One Venture® Rewards. 

    • This credit card also requires a good to excellent credit score for approval. The annual fee is $95 (waived in the first year) with a standard APR of between 17.24% to 24.29%
    • Travelers will benefit from a 50,000-mile sign-up bonus provided that they spend $3,000 on purchases within the first three months after the card is issued
    • Global Entry and TSA Precheck users will receive up to $100 as a statement credit

    If you happen to be shopping on Amazon and paying by Paypal, you may be able to stack your rewards from more than one card and increase your savings even further. 

    Other Tricks  

    Once you’ve started reducing your online shopping bill you won’t want to stop. Looking out for promo codes and special offers is a great way to make your purchases even more affordable.  

    • Promo codes may appear on the website itself while you’re shopping, often in a pop-up window. Once you enter the code, you’ll receive a set percentage off your purchase 
    • Many retailers run online campaigns and sales featuring super-discounted items. You could find anything from summer clothing to new smartphones at excellent prices 


    Earning cash back rewards is one of the perks of having a credit card. You can use them to reduce your online shopping bill substantially. By applying your rewards to your final checkout balance and using promo codes, you’ll save even more on your purchases than you previously expected. 

    If you’d like to apply for one of the cards in this article, you’ll want to check your FICO score by requesting your free annual credit report before you apply. 


    Review Your Credit Reports For Errors 

    Consumers borrow money at an increased rate when times are hard.

    Unfortunately, there’s always the possibility that an error may occur - and that’s why it’s essential to check your credit report from the bureaus on a regular basis.

    • Every consumer is entitled to a free annual credit report. As part of the coronavirus relief measures the three credit bureaus have decided to make the reports available on a weekly basis free of charge.
    • Once you receive your report, you’ll want to go through it carefully and keep an eye out for any information that doesn’t look right.
    • If you find mistakes in the document, you can lodge a dispute with the credit bureau that provided the report. 

    Watch Out For Signs Of Fraud

    In the previous section we highlighted the importance of checking your personal information for accuracy.

    One of the reasons for this is that you’ll be able to pick up telltale signs of fraud and hopefully take action before you incur any financial losses.

    • If you notice a name, address, and especially Social Security number that does not belong to you, this could be a strong sign of fraudulent activity.
    • Similarly, if there are any accounts listed on your report that are not yours you’ll need to contact the lender and the credit bureau immediately and file a fraud report. You may also want to freeze your credit profile temporarily.

    Make All Minimum Payments

    If you can possibly make the minimum payment due on your credit cards, you’ll save yourself the significant trouble of having a low credit score.

    • Having your score drop from good to fair – or from fair to bad can have long-term consequences. You may pay higher APR‘s in the future or be rejected for lending products and even some types of accommodation.
    • If you’re unable to make your minimum payments, it’s always best to contact your lender ahead of time and ask for an extension.

    What Your Spending 

    The months and years ahead will be a challenging time for everyone –  and one of the best things you can do is reduce your spending on nonessential items and pay down your debt while boosting your savings.

    • Now is the time to focus on essentials and cut down on expenses and that you can do without. If you’re practicing social distancing you may want to cancel your gym subscription and other monthly expenses services you no longer need. 
    • If you don’t already use a monthly budget to plan your spending, this could be the ideal opportunity to set one up. By listing out every  item or activity you spend money on, you’ll be able to identify which expenses can be cut without compromising your quality of life.
    • The money you save by reducing your spending can be used to pay down your high APR debts and grow your emergency savings fund. You’ll want to have anything from 3 to 12 months expenses saved up to weatherer the uncertain times ahead.

    Seek Help If You Need It

    If you’ve tried your best to budget and pay down your debts but still find yourself in a financially difficult situation, you’re not alone.

    The unprecedented coronavirus crisis has placed many people in situations of hardship and there are several ways of seeking help with your monthly payments should you need it.

    • Reach out to your creditors. Many card issuers are offering customers a range of relief measures as outlined in the CARES Act. These may include payment deferrals and the temporary suspension of the negative credit reporting for a limited time.
    • Consider credit counseling. If your repayments have become unaffordable, you can consult a financial professional who will help you to budget effectively and may be able to negotiate with your creditors to have the interest on your outstanding debts reduced.
    • Don’t forget  about friends and family. Even though the current economy is affecting everyone’s finances, your close friends and relatives may be able to assist you with a small loan, shared accommodation, or other forms of assistance. 


    As the COVID-19 crisis continues to unfold, the economic impact is being felt by everyone. 

    In an uncertain economy the best strategy is to save money and pay down your debt.

    This will help you protect your good credit score, giving you access to emergency borrowing should you need it while laying the foundation for your financial future after the pandemic has passed.