Method to redeem credit card cash back

[CDRE]

The Discover Card has three methods to redeem the earned cash back:

1. Apply to the next monthly statement.
2. Send to charity.
3. Redeem for a gift card for a Discover partner that typically offers a discount (redeem $45 cash and receive a $50 gift card).

It seems that redeeming to a gift card with such a typical discount increases the utility of the cash back payback, especially if you were going to spend funds at that partner anyway. We have always applied the cash back to the next monthly statement during the December big spend but may switch to the gift card method.

I believe some credit cards allow the cash back proceeds to be directed into an investment account.

How do you redeem the cash back that you get from your credit card(s)?

 

[timbervest]

Apply to next monthly statement. Offsets the next month's spending. It's basically all one big pot of money.

 

[gwraigty]

Automatic deposits on the Fidelity and Schwab cards. Manual bank deposits on the cards that allow that. All others, a manual statement credit. Discover is a bit of a pain in that I used to be able to do a manual bank deposit. That option has been perpetually grayed out on the website for a long time now, so I just do a manual statement credit now.

 

[audreyh1]

I do whatever gives me the most back. Usually that’s credit on the statement.

 

[RobbieB]

I go with the dough.

 

[lemming]

Once,long ago, there were gift cards for restaurants sold at a discount and I would buy those as a gift for myself. Now my card sells the cards but at full face value(a pet peeve)
I lie to myself a lot. I used 200.00 against my balance when I bought my dishwasher to pretend I did not spend too much money on it. I still put it in the expenses at full price though.
I think putting it as a payment is dull but the most effective use of funds.

 

[Throwdownmyaceinthehole]

Mine goes into my secret slush fund that I use for non hubby approved purchases. Mostly travel or ukuleles....

 

[Bamaman]

My Capital One Venture card can only be applied against travel and vacation charges. I can use it to pay hotel bills, transportation and meals.

So far, we've cashed it in for two flights to Europe this year. My wife ran up on a 2 hour fare sale Nashville to Berlin for just over $400--and down from a normal $1400ish. It's nice to have points saved where we can take advantage of bargains quickly.

 

[Senator]

I apply it to the statement. At Amazon, I never use it to discount the purchase. I lose 5% if I do that.

 

[COcheesehead]

Fidelity...2% each month in cash into my taxable account. I get the funds usually in 2 days or less.

 

[jazz4cash]

A gift card means you have to spend more to receive your reward. Gift cards are a pain for me to track. I always go for the statement credit.

 

[steelyman]

I normally deposit Discover cash back to my credit union checking account. I’m starting to use AmEx more after reading recent discussions here about cash backs. Those rewards I take as a statement credit.

When I moved between states in 2015 I racked up a lot of Discover cash back for moving expenses. They were then offering a deal where you could buy Lowe’s (home improvement) cards at a discount, something like $100 card for $90.

I cashed all the Discover rewards for Lowe’s cards and used them to buy a very nice Bosch jobsite radio with battery backup that I still use and was very glad to have when Hurricane Matthew visited.

 

[audreyh1]

I apply it to the statement. At Amazon, I never use it to discount the purchase. I lose 5% if I do that.

Exactly!

 

[Dtail]

With BOA, cash refunds work the best. Even for my travel card, I transfer the points to another BOA card in order to effectively have the cash refund equal the credit statement.

 

[GenXguy]

I just did this recently on my Chase Freedom and Discover.

With Discover, I credited the cashback to my statement balance due.

With Chase Freedom, I transferred the cashback to my checking, which is where I pay my bill from, so accomplishing the same thing as with Discover.

 

[rk911]

The Discover Card has three methods to redeem the earned cash back:

1. Apply to the next monthly statement.
2. Send to charity.
3. Redeem for a gift card for a Discover partner that typically offers a discount (redeem $45 cash and receive a $50 gift card).

It seems that redeeming to a gift card with such a typical discount increases the utility of the cash back payback, especially if you were going to spend funds at that partner anyway. We have always applied the cash back to the next monthly statement during the December big spend but may switch to the gift card method.

I believe some credit cards allow the cash back proceeds to be directed into an investment account.

How do you redeem the cash back that you get from your credit card(s)?

we apply it as a credit to the account.

 

[littleb]

Does anybody know if you can get a cc once you retire? Also, in my case no ss, pension or IRA distributions. No income stream just living on cash for the past few years.

Currently have the majority of our IRA' s at Fidelity. Would this be a factor for approval of a Fidelity cc?

 

[sengsational]

I apply it to the statement. At Amazon, I never use it to discount the purchase. I lose 5% if I do that.

I never thought about that. So it's because you get 5% added bonus? So I put $10 as statement credit, they add $0.50 bonus for next time? Because I usually just apply it to Amazon purchases.

A gift card means you have to spend more to receive your reward. Gift cards are a pain for me to track. I always go for the statement credit.

+1

Does anybody know if you can get a cc once you retire? Also, in my case no ss, pension or IRA distributions. No income stream just living on cash for the past few years.

Currently have the majority of our IRA' s at Fidelity. Would this be a factor for approval of a Fidelity cc?

Elan at Fidelity is good, but any card is fair game if you have a good credit rating it's no problem; just make-up an income number. I usually say it's about 150 or 200% of my annual spending. You might check http://www.early-retirement.org/forums/f28/cash-back-credit-cards-95740.html
There are loads of options when selecting a CC.

 

[cathy63]

I never thought about that. So it's because you get 5% added bonus? So I put $10 as statement credit, they add $0.50 bonus for next time? Because I usually just apply it to Amazon purchases.

No, you don't get a bonus on points used as statement credits. The 5% refers to the points you aren't earning because you didn't charge the full amount of the new purchase. For example, if you have 1000 points accrued, and you're going to spend $100 on a new Amazon purchase, then you have two options:

1) Charge $90 and use the 1000 points as $10 credit. After the purchase, you'll receive 450 points on the $90 charge, which you can use for $4.50 off something else in the future. Net savings of $14.50.

2) Charge $100. After the purchase you'll receive 500 points on the $100 charge for a total of 1500 points. which you can use for a statement credit of $15. Net savings of $15.00.

Unless you buy a ton of stuff at Amazon, these are very small amounts and probably only a few dollars over the course of a year. But hey, I would pick up 50 cents if I saw it on the sidewalk, and it's no trouble to cash the points in once every few months, so why not?