A number of years ago, before we got into points and miles, it was possible to purchase coins at face value from the US Treasury with a credit card. Given the right number of coins purchased, shipping was free. As you can imagine, points enthusiasts took advantage of this and racked up large points balances buying coins, depositing them in their bank account, and paying off their credit card. This process of cyclical spending is known as Manufactured Spend- and the US Treasury version of it was fee free.
This post is not about manufactured spend such as the above. However, it is about increasing your reward earning capabilities by shifting to using credit cards wherever possible. Referring back to the article we rebutted by Dave Ramsey, he warns of overspending with a credit card. NEVER put anything on your credit card that you wouldn't otherwise purchase if you were using cash. But you can start using your credit card instead of cash/debit in order to earn rewards.
Below are just a few examples of this.
Rent- this is often times one of the largest monthly expenditures. See if your Landlord accepts credit cards. Sometimes you can pay by credit card with a small fee to do so. In some cases, it may make sense to do this. Mortgages rarely let you pay by credit card, but there are exceptions.
Groceries- this is often times a large monthly expenditure which you could earn a lot of points by shifting to using a credit card.
Online Purchases- Spend a lot online? We love to use our credit cards for all our online purchases. Not only do we earn points for these transactions, but we have the added benefit of price protection, extended warranties, and return protection.
Insurance- There is usually no fee to pay your insurance by credit card. Our annual car insurance is due in January and July of each year. This year, we found out that it is possible to pay the insurance in split payments. As a result, we purchased $200 gift cards (with a fee of $4.95) from a store where we earned 5x points for each dollar spent there. As a result, we multiplied our point earning by 4x as we normally would have paid this by a credit card that just earns 1x points.
Every day purchases- We use our credit cards for ALL our everyday purchases rather than using a debit card. There are purchases that we planned on spending for anyway.
Big purchases- See this post about how we earned a LOT of sign up points for our new kitchen. We had saved up to do this renovation and fortunately we were able to pay for the renovation with a credit card. Do you have significant purchases upcoming that you have saved up for? Why not put these on a credit card, and pay them off immediately. This way you will supercharge your reward earning ability.
If you have a rewards card currently, you can earn lots of points by doing nothing different- just putting your day in and day out spend on this card. Make your money work for you. And remember- never put anything on a credit card that you cannot afford.