5 Big Expenses Worth Charging on Credit To Get Rewards

It’s generally a good rule of personal finance to never charge more than you can afford to pay off when your bill comes due. Learning how to manage your credit responsibly so you don’t overspend takes time, experience, and discipline.

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Many people use their rewards credit card for everyday spending — things like gas and groceries that they would buy anyway. But it’s easy to overspend when you use plastic.

It might be easier to earn credit card rewards by charging big-ticket purchases and using cash for everyday spending. If you have enough money in savings to pay the bill in full by the due date, the rewards will add up quickly, and you won’t end up paying interest on one too many coffees.

Energy-Efficient Home Appliances

When your dishwasher or refrigerator breaks beyond repair, you’ll have to replace it. You might decide to replace all your kitchen appliances at the same time, so you’ll still have a matching set. Plus, you can often save money by bundling your refrigerator, microwave, range, and dishwasher as a package.

According to HomeGuide.com, the average appliance package costs between $2,100 and $5,400. If you have a card that delivers 2% rewards, you’ll earn $42 to $108 back. If you replace older, less efficient appliances with Energy Star-rated models, you’ll also save money on your electric bill.

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4K Smart TV

Amazon currently offers 50-inch Samsung 4K Smart TVs for as low as $350. However, if you want a larger or higher-quality model, you’ll still pay thousands. If you use your Amazon Prime Visa on a $2,100 smart TV, you’ll earn 5%, or $105, cash back.

Plus, it’s smart to use a rewards card on high-priced electronics because most credit cards carry purchase protection in case your device breaks.

Refundable Airline Tickets

It pays to book your next flight using a travel rewards credit card. You can increase your earnings if you book through the travel portal affiliated with your credit card. For instance, if you pay for travel through Chase Travel with the Chase Sapphire Preferred Card, you’ll get 5 points back for every dollar spent. When you have enough points, you can redeem those points through Chase Travel for your next trip, and they are worth 25% more, according to GOBankingRates’ review of the card.

Refundable Hotel Rooms

Similarly, it pays to book your hotel room with a rewards credit card. When you check into a hotel, the hotel typically puts a deposit of anywhere from $50 to $100 or more per day on your card. If you don’t spend that money on incidentals within the hotel, it can take 7 to 10 days for the money to be returned to your account. If you use a debit card, that ties up your cash for more than a week.

Car Tires

Tires for your car are a big-ticket purchase that you may not think about. You can find the best deals on tires, with free installation, at BJ’s or Costco warehouse clubs. In addition to saving money, why not earn cash back by using your rewards credit card? The BJ’s One Mastercard from Capital One delivers 3% in BJ’s rewards on every purchase at the club. That’s $30 you can use to spend on your next shopping trip if your tires cost $1,000.

A Few Points to Remember

Leveraging credit card rewards on big-ticket purchases can put cash in your pocket. If you only use your credit cards for larger, one-off purchases, there’s less chance you will lose track of your credit card spending. You can avoid interest if you pay your balance in full by the due date, so only spend money you already have.

Keep in mind that it’s always a good idea not to charge more than 30% of your available credit on a card each month. Your credit utilization plays a big role in your credit score.

This article originally appeared on GOBankingRates.com : 5 Big Expenses Worth Charging on Credit To Get Rewards