May 2008: American Express Saved Me $0.13

It was a big month for using my American Express Card. I saved a whopping $0.13. You read that right, thirteen cents. It doesn’t cover the postage for paying off the bill, but it does pay for the one cent postage increase this month. Since I pay off my bill scheduling ACH debits, I don’t worry about postage increases.

I pretty much use my American Express Card when I shop at Costco since Costco only takes cash, checks or American Express. Costco used to take all credit cards but they changed the policy a few years ago to only use one credit company.

The good thing about the card is that your annual card fee is waved when your Costco membership is charged on it. The net result is that the express card is free of annual fees. So if you like to save money by shopping wholesale at Costco, the card is worth it.

The other thing is that you get a rebate. Initially, you get ¼ percent back on what you buy. Then it increases (to what I don’t recall at this time).

So if you break down my 0.25% savings by shopping at Costco last month, I spent $52.10 buying groceries, and got refunded thirteen cents.

So, how much money did I save? Adding it up, I saved 0.13 in refund and 0.42 in postage by paying off my bill online for a total of 0.55. I’m so cheap. Or, would you call it thrifty?

According to TheStar.com, in the article Credit credit card rebate offers easy to miss, if you’re not careful, you may actually shred your rebate check.

“Instead of sending rebates separately, American Express prints them and embeds them in cardholders' statements.”

I found that the rebate check is not too obvious, but AMEX (NYSE:AXP) keeps on sending reminders that that you haven’t cashed your check yet.

In my case, I shredded my first rebate check from American Express. Now that I know this is how they issue the rebate, I look for it once a year around my anniversary.

Until next month, remember to pay off your balances. Schedule your payments online to save you both time money and postage!

May 2008: My Discover Card Paid Me $14.15

One of the common themes in saving money by using credit cards is the cash back you get each month just by shopping. We pretty much use Discover to cover our expenses for the month and highly recommend the card.

Now I don’t go out and charge my card up to its limit, but pay off the balance each month to avoid the daily period rates credit card companies charge you. Also, remember to pay it off early so you don’t get chardged a late fee.

This month I saved $14.15 by spending $1,532.74. I was expecting to earn $15.33 back or 1% of the spending. I’m not exactly sure why I didn’t get the full month, but April is my anniversary so sometimes they reset the annual amount so the first 1,000 you spend, you get 0.5% back instead of the full amount. It’s only a dollar, so I’m not too concerned at this point.

Taking a look at what I bought:

Merchandise/Retail: 363.60 (23.7%)

Gasoline: 345.80 (22.6%)

Services: 12.88 (0.8%)

Supermarkets: 638.49 (41.7%)

Home Improvement: 171.97 (11.2%)

Almost 25% of my spending was in the Merchandise/Retail sector. Unfortunately Discover Card categorizes CVS perchases into this area. Thus, any pharmacy items that you use to charge on your credit card get lumped into Merchandise/Retail category.

I like to keep Merchandise and Retail down to about 15% of my spending budget $1,500 per month. With rising gas prices, it’s not too difficult to exceed my monthly credit card budget.

You Can Actually Save More Than 1%

Here just are a few examples you can save using your Discover Card by shopping online:

• 5% Circuit City
• 10% Nike
• 15% PetSmart
• 20% FTD.com

To get these discounts, you need to login to your Discover account and connect to the merchant sites.

On a final note for this month’s saving tip, always pay off your credit card and if you can’t pay as much as possible to get out of debt as soon as possible. Send out your payment a week earlier that it is due or login to your Discover Card to schedule your payment the day before it is due.

Discover Card Saved Me Over $4000

I received my new Discover Card in the mail last week. Since I still had a month remaining before the old card expired, I set it aside until I had some time to call in to get it activated.

Normally you call the activation number on the sticker pasted on your credit card and enter your number and you’re all set. But this time, instead of a pre-recorded message, I got a live person.

“Hi, this is Jenna! Thank you for activating your card. I see that you’ve been a member since, ah, 1984. Wow you were one of the first members!”

Not that she was trying to make me feel old, but that was 24 years ago when credit was rather tight. Back then, Discover was owned by Sears — who extended me a whopping $200 credit line on their Sears Credit Card when I was a sophomore in College — and Sears offered their customers a new credit card that you could use at other retail stores.

For the first few years, not everyone took Discover so many times I had to pay with cash. (What a novel idea.)

Since I mostly charge my all my expenses using Discover, I get around $20 back every month. So for being one of the “first members,” Discover Card paid me around $4000!

Jenna continued, “Would you like to enroll up this summer for the 5% bonus payment for Gas and grocery purchases?”

“Does it cost anything?” I said.

“No. Just by saying you want to enroll, you qualify for the offer.”

“Thank you, please enroll me!” I buy all my gas and groceries using credit cards, so instead of the normal 1% kickback, I’m going to get 5%!

“Jenna, how can I automatically enroll in these offers?”

“You can’t. You have to enroll by calling us or by activating the offer using the internet.”

“Ok, I call back next month to enroll, thanks.”

Now the up-sell and why they want you to call in to activate the bonus payments: “Would you like to enroll in our privacy protection?”

“No thanks. Perhaps I’ll consider it sometime in the future.”

“Ok, you’re new card is activated. Please sign your card and remove the sticker. And thanks for using Discover!”

No. Thank you Discover! You’re a great credit card company that saved me thousands for being a valuable member.

Welcome to Save Money Using Credit Cards

Hi, and welcome to Save Money Using Credit Cards. If you're like me, you probably get several credit card offers every week. I would like to share with you a few tips on how I actually save money, get free travel and best of all get paid for using my Discover, Visa and American Express.

First of all, I don't expect that you're going to save as much money as I have over the years. Perhaps that's because if you're starting out fresh with little or no credit experience and I've got a good 25 years on you. But I remember when I first started out with credit, I was earning enough to pay for the postage to pay off the balance for the month.

Even though I think I'm frugal, expenses still add up. And over time, you're going get a lot of cash back if you keep a zero balance. So far, I've earned more than $4,000 in rewards. Now that's nothing to sneeze at.

I'll be posting from time to time whenever I come up with an idea that can save you money.

- Howard