When rotating categories don't align with your spending habits

Maximize cash back even when your bonuses don't match your lifestyle; here's how

How to maximize rotating categories that don't match your spending habits

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 With rotating credit card rewards categories, it’s boom or bust.

Some quarters, it seems like everything you buy is racking multiple bonus points. Other times, those bonus categories are places you seldom buy. And it feels as if you’re earning practically nil.

Truth is, with a little engineering, you can boost the rewards you achieve via those rotating categories. Even when they don’t quite sync with what you normally buy.

Sometimes, you win by taking the long view. Other times, by knowing how to work the system – and the loopholes.

Here are a few tips to make the most out of rotating categories regardless of your spending habits:

Tips to maximize rotating categories on your cash back credit card

Don’t be afraid to stock up.
  • Buy larger quantities of items that won’t spoil.
  • Pay a sizable chunk of your annual phone bill in advance.
Shop like Santa year-round.
  • Use quarter bonuses to buy gift cards or certificates at favorite restaurants.
  • Buy presents and keep them in your closet until the gift-giving occasion.
Take advantage of online shopping and mobile wallets.
  • Some retailers accept different cards online compared to brick-and-mortar stores.
  • If your card offers a bonus on digital wallets, this is a good time to set it up on your phone.
When you just can’t make it work:
  • Consider adding a new card to your wallet and mix and match issuers.
  • Settle for a flat-rate card with a high cash back rate.

Don't be afraid to stock up

Want to make the most of those rotating bonus categories? “It’s helpful if they can budget to think about ‘What do I need over the year or longer,’” says Charles Rotblut, vice president for the American Association of Individual Investors.

One example: From January through March 2018, Chase Freedom offers 5 percent for every dollar you spend on internet, cable and phone services – up to a combined total of $1,500. So, if you know you’re going to use a service all year and can afford to pay for a sizable chunk (or all) of it over those three months, you can bank extra points. 

Or, if you’re planning to buy a new smartphone this year, pick it up now and pay for it with your card.

You also can check out products you need at places you don’t normally buy them. For instance, browsing office supplies at your favorite warehouse club. And if you lay in a supply, “A ream of paper or printer ink is not going to go bad anytime soon,” says Rotblut.

But before you start buying items anywhere, do the math, says Rotblut. Are prices as good or better than where you normally by the products? If not, he asks, “Is that price justified by the extra points?”

Pro tip: Stickers are one way to remember which card to use as categories change throughout the year. When you look up (or register) for those quarterly bonus categories, write them on a small sticker (like the ones used to label file folders), and slap that on the back of the credit card, says Rotblut. That way, you instantly know which card to use.

Stickers are one way to remember which card to use as categories change throughout the year. When you register for those quarterly bonus categories, write them on a small sticker and slap that on the back of the credit card.

Shop like Santa year-round

Rotating categories also can be a boon for gift giving, says Trent Hamm, founder of The Simple Dollar.

How can you stretch your bonus category? Pick up gift certificates or gift cards at favorite restaurants. Just check that those gifts won’t expire too soon after the date you’ll actually be giving them.

Grocery stores on your summer category rotation? Your average food store has a rack of gift cards for everything from movie theaters and coffee shops to restaurants, clothing retailers and online entertainment.

And that same gift card strategy comes in handy if you’re a cardholder who doesn’t drive, and the quarterly category is “gas stations.”

While gas stations often post higher prices on groceries, they can be great places to pick up gift cards for everything from spas to sporting goods stores. (And the gift cards are the same price everywhere.)

One caution: Sometimes purchases at the convenience store portion of a gas station will be coded as a retailer, not a gas station, says Zach Honig, editor-at-large for The Points Guy.

His tip: Before you sink money into a stack of gift cards, use that credit card to buy something small you need anyway – such as a soda. That way, you can see how purchases are classified. 

But if you don’t want to give gift cards, bonus categories also offer opportunities to pick up some pretty cool presents, too.

For most cards with rotating categories, October through December focuses on presents, with extra points for everything from Amazon and wholesale clubs (Discover), to Walmart and department stores (Chase, 2017). Then just “save the item in your closet until the gift-giving occasion,” says Hamm.

Take advantage of online shopping and digital wallets 

Alas, sometimes your favorite stores don’t accept your favorite cards.

While a Mastercard may award five times the cash back for wholesale club purchases, the only card accepted by warehouse giant Costco is Visa. Does that mean if you’re a happy Mastercard customer and Costco shopper you’re out of luck? Not necessarily.

There are a couple of loopholes. For example, Costco.com accepts Discover and Mastercard. What this means: You can shop online for many items also available at your local warehouse store and rack up card rewards, too. Just keep in mind that offer selection and prices on groceries and other categories may vary, so compare prices between your local Costco and Costco.com before making any purchases.

Don’t like online shopping? Use your Mastercard to buy Costco Cash Cards (gift cards) from Costco.com, then shop Costco as you normally would and collect those category rewards.


Video: How to set up your mobile wallet

And sometimes the way you pay is the key to earning those rotating bonus points.

For instance, Chase Freedom is offering five times the points for consumers who make their purchases from a digital wallet (Android, Apple, Google or Samsung), through March 2018.

“In a way, that gives you the opportunity to get 5 percent on pretty much any purchase,” says Honig.

Which could be all the incentive you need to load up, or finally use, a wallet app.

When you just can’t make it work ...

Sometimes, no matter how you plot and plan, there’s no way to take advantage of a particular rotating category.

“I do think that’s an argument for having more than one credit card,” says Rotblut.

Plan for that, too. You can carry complementary cards that will have you covered for either situation.

One possible combo: Chase’s Freedom card, which offers cash back in rotating categories, along with the Freedom Unlimited or either of the Chase Sapphire cards – both of which offer a flat rate on rewards. These are all Chase Ultimate Rewards cards, too, which you can pair to boost your travel rewards.

Or mix and match card issuers and card networks, so that – in the case of international travel – you’re more likely to have at least one card that’s accepted wherever you are.

You also can select a backup rewards card for its simplicity. That’s where something like the Citi Double Cash, can come in handy, says Rotblut.

For many people, a flat-rate cash back or travel rewards card “is easier and simpler,” he says. 

In the end, he says, “People also just don’t consider the value of their time and the mental effort.”

See related: Chase Freedom vs. Discover It: Which card is best for you?Chase unveils its cash back category for Q2 2018, Discover cash back category 2018

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Updated: 03-22-2018