5% October Cash Back Bonus Down the Drain

I really screwed up big last month using my Discover Card. I forgot to sign up for the 5% cash back bonus which is something you need to do every 3 months by either login into the Discover account center or by calling Discover.

The last quarter of the year, the 5% cashback bonus includes purchases at grocery stores, restaurants, movie theaters and movie rentals.

A major portion of our expenses are eating so it's not unusual to spend $1000 on food for the month. With 5% cash back, we would have saved about $50 in October, but since I forgot to sign up the first of October, we only saved $10 under the normal 1%.

The rest of the year we should be able to save more especially when planning meals for Thanksgiving, Christmas and New Years.

If you haven't signed up already, give Discovery a call or apply your savings online in the account center. It's never too late to sign up for the extra cash back -- just make sure that you remind yourself to do it as early as possible in January, April, July and October to take advantage of the savings accumulated over three months.

The Discover More Card - Tips to Reduce Your Credit Card Payments

Credit cards are unsecured lines of credit giving you flexible spending accounts. The Discover More Card gives you the flexibility of cash while saving you money on purchases. The best way to take advantage of the Discover More Card is to eliminate the fees and interest which Discover will charge you.

Fees and interest payments will quickly diminish the 5% you earn towards every purchase. But with careful planning, budgeting and especially paying off monthly charges, you can save a substantial amount of money over extended periods use of Discover More Card.

Credit Card Fees

One can avoid fees by making a payment towards your account. However, if the balance is not paid in full, your account starts accruing interest on the balance and future purchases until the balance reaches zero. Discover can charge you from $19 to $39 even if your payment is only a day late.

Sometimes a simple call to Discover will reverse the late fee especially if the payment is due around a holiday. But the best way to avoid the fee is to mail your payment one week before it is due or schedule an online payment.

Cash Advance Fees

Most charge companies have a minimum transaction fee on top of the interest you incur at the time of the cash advance. If the cash advanced fees annualized, you may end up paying upwards to 30%. Thus, try to avoid taking out cash unless you need cash for an emergency.

Annual Percentage Rate (APR)

Credit companies charge various fees for using their credit card. You should make it a priority in avoiding late fees by making your monthly payment on time.. While annual fees were predominate several decades ago, there is no reason to carry a charge cards that have annual fees.

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.