Q4 is a heck of a busy time in our families. Of our immediate family members, 8 out of 9 people have birthdays in this October – December period, and when you throw in Halloween, Thanksgiving, and Christmas, it can pretty overwhelming if you don’t have some cash set aside, or a way to limit your spending. In our case, we do both. And the way we’ve been allocating and limiting the “Holiday Money” for the past several years is pretty simple.
We Use Our Rewards Cards!
Use the rewards, that is. We let our rewards on these cards accumulate throughout the year. Then, each October or November, we cash the rewards in on all of our cards. That becomes our “Holiday Money” for the season. All presents, extra spending on food and parties ends up coming out of this bucket. The rewards money puts a cap on what we’re allowed to spend, and we don’t feel like we had to “save up” or “put anything away” since the cards did it for us throughout the year.
So where do we stand this year?
Total Rewards Dollars: $1098.27
Not shabby – looks like we’ll be livin’ large this holiday season. Seriously, this is definitely the highest that we have had since we’ve been using this system. It’s partly because we got the bonus from our new Amex card, but it’s also because we’ve been doing a better job managing what cards our spending goes on to maximize rewards.
How does the total break out across the 3 cards that we use?
Discover More Cash Back Rewards: $333.34 in rewards that we can apply directly as a statement credit, or we can choose to buy discounted gift cards with some of these rewards if we want to give gift cards as gifts.
Here’s a screen capture from Discover’s rewards gift cards page – there are over 150 different retailers that Discover has discounted gift cards through. The discount amounts vary slightly, but the spend $45 in rewards for a $50 gift card at Macy’s or $20 for a $25 card at Staples is pretty standard for the site. So that’s between a 10-20% bonus amount on the face value of the gift card. That’s not bad, as long as you want to give gift cards…
For now, we’re holding off on cashing in these rewards dollars to see if we’re going to end up going with gift cards for anyone. Usually we stay away from gift cards as gifts, but it’s not unheard of… so I’d rather get the recipient more bang for the buck on their gift card by buying it here rather than at the retailer if that’s what they’re getting.
Chase Freedom Ultimate Rewards: $512.54 in rewards that we can apply directly as a statement credit or receive as a check in the mail. Chase also has gift cards that you can buy, but I didn’t notice any with discounts the way the Discover card has added value if you buy them through their site. Without the bonus amounts, it’s a no-brainer to take these rewards as cash and decide what to do with them once we’ve got the money.
We’ve taken this one as a credit to our account, so it’ll be counted as Miscellaneous Income on next month’s Income Statement – no big $0 for that category like there was on September’s Income Statement!
American Express BlueCash Everyday: We just got this card a couple of months ago (see the Amex review we posted last week!) and actually haven’t put much on this so far except for the $1,000 that we needed to spend to earn $250 in rewards. Now that we’re into a quarter where we don’t have any gas or grocery rewards on either of the other two cards, this one will start to get more use. But, we’ll take the $250 for now!
Amex has its own little rewards mall where you can “purchase” various items using the points. I took a gander through it and there’s not a whole lot there that we think our family members would want as gifts (or that we want as our own gifts!), so we’re just taking this $252.39 as a statement credit.
So there you have it – so far we’ve taken almost $765 in credits – and we have an additional $333 in the hopper to decide if we want to give some gift cards before we take the remainder as a credit. Now we just have to pick out gifts and start bulk buying the wrapping paper at the dollar store.
What do you do to help prepare for the onslaught of holiday spending? Do you cash in your rewards cards balances throughout the year, or save them up for something big like we do? How much money do you usually allocate toward holiday spending? Do you think almost $1,100 is too much for ourselves and our families this year (remember this is 8 birthdays, 9 people for Christmas, and a bunch of holiday cards that get sent out!)?