This post contains links to products from our advertisers, and we can get a fee if you click on these links. Our recommendations and advice belong only to us and have not been reviewed by any named issuers. Terms apply to any offers listed on this page.
🎬📺 Free Movies and Free TV Shows! 🎭🎬
After living more than ten years with over $ 80,000 in debt, this year I finally got debt free. I was able to get out of debt by spending diligently on mostly necessary things, with the occasional splurge, especially as I paid off the last $ 30,000.
It also helped that during the height of the COVID-19 pandemiceven though … me lost income, I was able to save by not doing grocery shopping in person and getting refunds for planned trips and concerts.
The process felt slow, but most of it paying off my debt happened in the past two years, as I got more serious about achieving my goal. What helped me the most was asking myself for every unnecessary purchase over $ 20: do I really want this, or will I be happier if I get out of debt?
It has been an adjustment to think about the next steps in my financial journey. The first month that I didn’t have to pay my usual $ 600 payment for my debt, I felt “rich.” But as I have become mentally accustomed to this new way of life, I realized that simply not bearing debt is not enough – especially at the age of 45, when I need to think more seriously about retirement.
While I’m saving through a Roth IRA Now that I have more financial resources, for the past few years I plan to help achieve my new one in 2021 pension annual savings target of at least $ 25,000 using rewards credit cards.
How credit card rewards will boost my savings in 2021
Although that may sound counterintuitive, like someone who once had to declare bankruptcy because of credit card debt, now I know there are ways to use credit cards to my advantage. Since my credit score is above 800, I feel comfortable applying for new credit cards strategic.
To begin with, I have budgeted as much of my expenses as possible if I can for 2021. Save for a springtime rental as a vacation with my boyfriend, to catch up on a trip we had to cancel this year due to the COVID-19 pandemic, I’m not sure I will be yet other travel. But for other bills like rent, utilities, food, website hosting, and office supplies, I can estimate the cost.
I’m investigating cash back credit cards without annual feessuch as the Bank of America® Cash Rewards credit card, which has a $ 200 cash back offer after you spend $ 1,000 on purchases in the first 90 days of account opening. I just did a good number of them holiday gift shopping, so in terms of regular spend, for most of 2021, I can’t guarantee that I’ll have $ 1,000 in expenses that I want to put on a credit card within that time.
But I do know that I have to come in February or March pay my accountant, which charges a little more (for business and personal taxes), so in one transaction I can meet that requirement and get back $ 200 in cash, which I can use for groceries and earn another 2% cash back, or 3% cash back online shopping, one of the options you can set each month. Those amounts apply up to $ 2,500 in combined expenses per quarter; any purchases outside of this will only yield 1% cashback.
I am also considering the Citi® Double Cash Card, that offers 2% back on all purchases – 1% on purchase and 1% on payment. That would make many of my purchases easier as I don’t have to worry about going over a certain amount per quarter.
If I didn’t already have it, I definitely would Chase Freedom Unlimited®, which offers $ 200 after spending $ 500 in the first three months of opening an account. (The Chase Freedom Flex℠ card also offers the same bonus.)
13.99% – 23.99% (variable)
2% cashback on all purchases
0% intro APR on balance transfers for 18 months. After that, the variable APR is 13.99% – 23.99%, based on your credit rating.
Balance transfer charges
Either $ 5 or 3% of the amount of each transfer, whichever is greater.
I am not concerned about my credit score
While I have enough credit cards and don’t need them anymore, especially since I do now pay any balances as they increasegetting cash back, even if it’s $ 200 once or twice a year, is essentially like free money. I’m not that concerned about it new cards affecting my credit score, or the lifetime of my corporate accounts, because my score is already high that dropping a few points would only be a temporary setback.
The most challenging aspect of figuring it out which cards and welcome bonuses make sense for me that is since i am a freelancer whose income varies from month to month, i have to remain flexible in my expenses. I’m sure I’ll hire my accountant because I don’t have a choice, but all other major purchases, including my vacation, depend on being able to pay my bills and meet my savings goals.
When I find out in January that my books sales have dropped dramatically, my part-time jobs are drying up, and I am only making enough to pay my most basic bills, adjust my credit card usage.
Tracking credit card rewards
The other important thing I’ll do to improve my finances for 2021 is create a spreadsheet to keep which cards I own and in which categories they offer cashback for each quarter.
In the past, I’ve often forgotten to maximize my spending in these categories, essentially leaving money on the table. Worse, I’ve forgotten sometimes activate the bonus categories of my credit cards, so I thought I was getting a certain percentage back, but I really wasn’t.
I know my Discover it® Cash Back
will offer 5% back between July and September 2021 on purchases from restaurants or made through PayPal. That’s so far off that of course I doubt I’ll remember it if I decide to pick up on, say, July 3rd. But I plan to consult my spreadsheet at the beginning and end of each month and schedule purchases accordingly (April to June 30, 2021, you can earn 5% cash back at gas stations, wholesale clubs and select streaming services up to $ 1,500 in purchases after registration, then 1%).
I’m not sure how much I’ll save with these methods, but whether it’s $ 100 or $ 1,000 (or more), that’s still money in my pocket instead of someone else’s.
🎬📺 Free Movies and Free TV Shows! 🎭🎬