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It seems hard to believe, but the holiday season is nearly upon us (though if you’ve visited a retailer like Target or Home Depot recently, you could be fooled into thinking it started in October). This typically means increased spending on gifts for family members and loved ones, and for many readers, that includes swiping your travel rewards credit cards with much higher frequency. However, not every card is created equal when it comes to your holiday purchases, so today I want to highlight some key things to look for as you’re deciding which card to use in the coming weeks.
1. Price Protection
One of the first factors that can influence this decision is price protection. At its simplest, a card with this benefit allows you to obtain a refund of the price difference if an eligible item you purchased on the card drops in price within a set time frame. Probably the most well-known of these programs is Citi’s Price Rewind, a program that saved members more than $2 million in 2015 alone. This perk is included on just about any Citi-issued card, including the Citi Prestige Card and the Citi Double Cash Card. The great thing is that when you register your purchase, Citi will automatically look for lower prices within the first 60 days (though you also have the ability to manually file a claim if you find the item advertised at a lower price). However, you’re limited to $500 per item and $2,500 per year.
Citi isn’t the only card issuer to offer this type of program; Chase also offers price protection on both the Chase Sapphire Reserve Card and the Chase Sapphire Preferred Card. Both of these cards have the same limits as Citi’s Price Rewind ($500 per item and $2,500 per year), but you actually have a 90-day window of time to find the item advertised at a lower price. Just keep in mind that all of these programs have many restrictions, so be sure to read the fine print if you think you have a valid claim to make sure the item you purchased is eligible.
2. Calendar-Year Bonus
Another thing to look for in a travel rewards credit card when it comes to your holiday purchases is whether or not it offers a calendar-year bonus for spending a certain amount of money on the card. Since we’re approaching the end of the year, you may find yourself in the neighborhood of reaching the spending threshold to earn the bonus. Here are a couple of examples:
- British Airways Visa Signature Card: When you spend $30,000 on the card in a calendar year, you’ll earn a Travel Together Ticket, which is basically a buy 1, get 1 free award ticket (though you’ll still need to pay the carrier’s absurd taxes and fees).
- Platinum Delta SkyMiles Credit Card: When you spend $25,000 on the card in a calendar year, you’ll earn 10,000 bonus miles and 10,000 Medallion Qualification Miles (MQMs). When you reach $50,000, you’ll earn another 10,000 miles and 10,000 MQMs. These miles can go a long way toward helping qualify for Medallion elite status and will also help you avoid the carrier’s revenue-based requirements.
- United MileagePlus Explorer Card: When you spend $25,000 on the card in a calendar year, you’ll earn 10,000 bonus miles (worth $150 based on TPG’s most recent valuations).
If you’re closing in on one of these bonuses, it could make a lot of sense to use that card for your purchases to ensure that you hit the given spending threshold before December 31.
3. Bonus Points
Of course, it’s also essential that you pay attention to category bonuses across various merchants and make sure you are using the card that offers the best return on your spending. For example, the Chase Freedom is currently offering 5% cash back at wholesale clubs, pharmacies and department stores, the latter of which is especially appealing for holiday gift purchases. This may not seem like a fantastic bonus, but if you pair the card with a premium Ultimate Rewards-earning card (like the Chase Sapphire Preferred Card), you can actually convert cash back into full Ultimate Rewards points, opening up the ability to transfer them to valuable partners like United and Hyatt.
You’ll also want to consider using a card on which you’re working toward a sign-up bonus. The vast majority of cards offer these bonuses by spending a certain amount of money within a set time frame, so if time’s running out for a new card in your wallet, holiday purchases can be a great way to boost your spending and make sure to snag the bonus.
4. Purchase and Return Protection
A much less glamorous benefit offered on many cards is purchase protection (different than price protection mentioned above). If you purchase an eligible item using your card that is then accidentally damaged, lost or stolen within a specified time frame after purchase (generally 90 days), you’ll be covered for a replacement. One particularly good option here is the American Express Premier Rewards Gold Card, as the card upped its coverage tenfold (from $1,000 to $10,000 per item) just last year. However, there are many other cards out there with this coverage as well.
A somewhat related benefit is return protection, another perk offered on many different cards. This protects you when a merchant won’t accept a return of an eligible item within a specified time frame after purchase (again, typically 90 days). Once again, you’ll see this offered on most cards out there.
5. Extended Warranty
Another common perk on travel rewards credit cards is extended warranty protection. In essence, this will add an additional year onto the published manufacturer’s warranty for an eligible item when you purchase it using a qualifying card. I’ve found that most manufacturers will set the length of their warranties to minimize the risk of anything going wrong, so of course the issues tend to come up in the year after the initial warranty has expired. If you use a covered card (like the Platinum Card from American Express), you’ll have that extra year in which to get reimbursed for any issues that you may encounter with the item, just like TPG reader Casey last year.
In addition to ensuring that you’re using the right credit cards, it’s critical that you go through an online shopping portal to maximize your earnings. This could be a simple cash-back platform like Ebates, but you also can choose from others like Alaska Mileage Plan Shopping. The best thing about these portals is that you don’t have to use a specific card for the purchases. This ensures that you can still take advantage of any one (or more) of the above benefits and double-dip with another program. My favorite site for deciding which portal to use is CashBackMonitor.com, as it will compare the earning rates for a given merchant across a variety of different shopping portals.
There are many factors that can influence which credit card you use for which purchase, and the holidays are no exception. With so many gifts to give out to friends and family members, you have some serious potential to earn bonus points and make sure that you’re protected if something goes wrong (like a dead computer a month after the manufacturer’s warranty expired). Hopefully this post has given you some suggestions on what to look for in a credit card when you’re plotting your upcoming holiday purchases!
Which credit card benefits are most important to you when it comes to holiday shopping?
Featured image courtesy of krestafer/Getty Images.
Chase Sapphire Preferred® Card
|Intro APR||Regular APR||Annual Fee||Foreign Transaction Fee||Credit Rating|
|N/A||16.24%-23.24% Variable||Introductory Annual Fee of $0 the first year, then $95||0%||Excellent Credit|