Ways to Maximize Credit Card Rewards and Cash Back

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One of my favorite ways to get free money fast is to maximize cash back and credit card rewards. If used correctly, credit cards can actually be a great tool for improving your financial situation.

The credit card industry is extremely competitive, and that’s good news for you and me. Thanks to the banks that fight for your business, you’re able to get some great rewards for purchases that you make with your credit card.

But getting the most out of your credit cards involves more than simply having a standard card that gives you 1% cash back. If you have the right cards and use them the right way you can easily make a few hundred dollars per year just from the things that you already purchase. And in this article, I’ll show you how.

Let’s look at the approach that you can use to maximize your cash back.

1. Use a Credit Card with at Least 1.5% Cash Back for Everyday Purchases

The industry standard for cash back is 1%, but there are some cards out there that offer better rewards. My go-to card is the Citi Double Cash credit card. I earn 2% cash back on every purchase with this card (1% at the time of purchase and 1% when I make the payment), and has no annual fee. That’s double the cash back of the typical 1% card! That adds up fast!

The Chase Freedom Unlimited offers 1.5% cash back on every purchase, and there is no annual fee. To make it even better, Chase is currently offering a $150 bonus if you sign up for the Chase Freedom Unlimited through this link.

I personally have both of these cards and I definitely recommend either as a great “everyday” card. To get the max cash back, go with the Citi Double Cash.

→ See a breakdown of the best cash back credit cards here.

2. Use the Chase Freedom Card to Get 5% Cash Back

The Chase Freedom card is a must-have if you want to maximize your cash back. Like the Chase Freedom Unlimited it has no annual fee and a nice $150 sign up bonus. The difference is how you earn cash back. With the Chase Freedom card you’ll get 1% cash back on all purchases, but each quarter there is a special category that will earn 5% cash back. The categories vary each quarter, but when the right offer is there you can rack up the rewards very quickly. Right now (at the time of writing this article) the current offer is 5% cash back on groceries. Last quarter it was 5% on gas. Other times it may be at retailers like Walmart or Amazon.

I’ve had the Chase Freedom for years, and I love it. I use it only for purchases in the 5% category. I don’t use it for other purchases because I can do better than the 1% cash back that this card offers. The key is simply to pay attention to the quarterly offers (Chase sends an email to let you know what purchases will earn 5%) and then simply remember to use the card when it’s appropriate.

→ Get the $150 bonus by signing up for the Chase Freedom card through this link.

The Discover It card is also very similar to the Chase Freedom card. The Discover It card also offers 5% cash back on purchases in a specific category each quarter, and 1% cash back on all other purchases. It also has no annual fee. Discover isn’t currently offering a bonus for signing up, but they will match all of the cash back you earn during your first 12 months with the card. This means you can earn up to 10% cash back on purchases in the first year!

3. Consider Specialty Cards

Ok, now that you have the Chase Freedom card and/or the Discover It card for purchases that will earn 5% cash back, and you have an “everyday” card to get the best cash back on other purchases, it’s time to look at specialty cards. There are several options here, and what’s right for you will depend on your spending habits. The key is to find cards that offer higher than 1.5% cash back on things that you purchase frequently.

Some cards offer things like 3% or 4% cash back on gas, restaurants, or some other type of purchase. See a breakdown of the best gas credit cards here.

You may also want to consider credit cards from stores that you shop at regularly. For example, Target and Lowes both offer 5% cash back on purchases if you use their card. If you’re an Amazon Prime subscriber, you can also get 5% back on Amazon purchases with the Amazon Prime credit card (I have this one too, and I use it for all of my Amazon purchases).

4. Take Advantage of Signup Bonuses

Sign up bonuses are a great way to quickly make some easy money. Bonuses typically require you to make a certain dollar amount of purchases on the card in the first 90 days to earn the cash back, so be sure you check those details.

For example, both the Chase Freedom and Chase Freedom Unlimited are currently offering $150 sign up bonuses if you make at least $500 in purchases in the first 90 days. If you’re putting most of your purchases on credit card, those dollar amounts are very reasonable and you should easily qualify for the bonus.

I’ve signed up for several credit cards over the past few years in order to get the signup bonus. You should always read the terms of the offer to make sure you know what you’re signing up for.

Personally, I look for cards with no annual fee in addition to the bonus. There are some great cards that do have annual fees, but you’ll need to use the same card for a lot of purchases in order to make up for the annual fee. My preference is simply to avoid annual fees because there are some great cards out there with no annual fee, like the Chase Freedom and Chase Freedom Unlimited.

→ See details of the credit cards with the best sign up bonuses.

5. Pay for Everything with Your Credit Cards

Now that you have some great cash back credit cards in your wallet, the key is to use them for every purchase. You don’t want to make any purchases simply to earn cash back, but when you’re making a purchase anyway, use the best card. If the purchase falls in the 5% category with Chase Freedom, use that card. If you have another card that earns high cash back on that purchase (like gas), use that card. Otherwise, use your everyday card like the Citi Double Cash so you earn at least 2%.

Many of your monthly recurring bills can be paid by credit card. This includes things like your cell phone, internet access, cable TV, utilities, insurance premiums, and maybe even things like your car payment. If you can get all, or at least most, of your recurring monthly bills on a good cash back credit card you’ll see the rewards adding up quickly.

6. Use Your Cards for Big Purchases

It’s not just everyday purchase that you can use credit cards for. Big purchases are where you’ll earn a lot of cash back in no time. For example, when my wife and I purchased a car we were able to put a certain amount of it on a credit card (I think it was up to $5,000). You may also be able to pay tuition and other big bills by credit card.

7. Stack Your Rewards with Ebates

If you like cash back, you will love Ebates. With a free Ebates account, you can earn cash back purchases from thousands of websites and retail stores, including Amazon, Walmart and many other big ones (and small ones too).

The amount of cash back varies by website/store, and sometimes it even varies by product category. With so many websites and stores participating with Ebates it’s really easy to save some money this way.

There are basically 3 steps to earning cash back with Ebates:

  1. Sign up for a free Ebates account.
  2. Install the browser add on (optional) that will automatically notify you of cash back offers when you are browsing the internet.
  3. Click on the notification before making a purchase to activate your cash back. (If you’re not using the browser add on you can login to Ebates and click through to a website before making a purchase.)

→ Right now Ebates is offering a $10 bonus if you sign up through this link.

And to make it even better, if you use Ebates and make a purchase with your cash back card, you can double dip on the rewards.

Ebates is the leader of its industry, but you can also earn cash back with BeFrugal, Swagbucks, and MyPoints. All 3 of these are currently offering signup bonuses as well.

For a detailed explanation (with examples) of how to do this, please see my article How to Stack Rewards and Cash Back, and see my list of the top 15 cash back websites.

8. Register Your Card with…

There are some websites and apps that allow you to link your credit or debit card and earn cash back from purchases made with the card. With iDine you’ll earn 5% or 10% cash back from restaurants that participate in their program. Dosh and Drop are apps that allow you to link your credit cards. You’ll earn cash back for purchases made at participating stores and websites. I use Dosh and it shows you a list of stores in your area and how much cash back you can earn. These earnings will be in addition to the cash back that you get from your credit card.

→ Get a $5 bonus if you sign up for Dosh through this link.

9. Use Reward Portals

Some credit cards will have a special portal where you can redeem your rewards, and in some cases, you can earn some extra bonuses this way. For example, you may get extra points if you redeem your rewards for a gift card or book travel instead of getting cash back, or you may be able to get gift cards at discounted rates.

The key here is to be sure that you are only using this for things that you would buy anyway. If you won’t use it, just get the cash back. To access these portals login to your credit card account and navigate to the rewards area.

10. If You’re Self-Employed, Get a Cash Back Business Credit Card

Are you self-employed? If so, be sure that you are using a cash back credit card for your business purchases. For my first few years in business I used a credit card that was issued by my bank when I opened business checking and savings accounts. This card didn’t have any cash back or rewards, so I was leaving money on the table. There are many cash back cards available for businesses, and sometimes you’ll find one with a good sign up bonus as well. If you have employees you can make them authorized users and also get cash back on their purchases.

→ Related reading: 13 Things You Can Do TODAY to Improve Your Finances

11. Pay Your Balance Each Month

Getting easy cash back from your credit card is great, but you don’t want to build up debt in the process. Make sure that you are only charging expenses that you will be able to pay in full each month. If you wind up paying interest you’ll be paying out much more than you’re earning in rewards.

→ Related reading: How to Create a Budget That Works

The last thing I want to point out is that you can get a free copy of your credit report at AnnualCreditReport.com. It’s a good idea to check your credit report and make sure that everything is accurate. If you find anything that is not correct, report it to the credit bureaus.

If you have any tips of your own for maximizing cash back rewards be sure to leave a comment.

READ NEXT: 101 Practical and Realistic Ways to Save Money

Ways to Maximize Your Credit Card Rewards