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TPG's Venmo guide for beginners: how to make the most of small, but mighty, perks

July 08, 2020
8 min read
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I love Venmo. There, I said it. It’s easy, quick and funds are readily accessible through their app. As a recent graduate, I can’t count on my hands how many times I used Venmo in college to keep track of my (limited) funds, especially when paying for utilities or paying a friend back for a pizza at 1:00 in the morning (don’t act like you never did that).

Is Venmo as beneficial as a credit card? Absolutely not. But there are a few reasons why I keep a Mastercard-branded Venmo debit card in my wallet and the app on my phone. As “The social way to pay,” Venmo has some definite perks, from cash back rewards to splitting payments with friends. Here are some of my favorite ways to take advantage of Venmo.

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Shop through Venmo rewards

A lot of people don’t know (I didn’t know until recently) that Venmo has a cash-back reward when using its card at select retailers. Venmo now has 19 cash-back partnerships with brands, from Safeway (2%) to Adidas (5%). Postmates offers $5 cash back on your first purchase and $0.25 cash back on each additional purchase. Forever 21 (4%), Tarte Cosmetics (10%) and Philosophy (8%) all offer incentives as well.

(Photo courtesy of Venmo)
(Photo courtesy of Venmo)

Costco even offers $20 cash back toward a new membership purchase, and you can also earn 5% back on any purchase at the pharmacy. As someone who loves to scan for sales online, especially cosmetics, this benefit is definitely one I’ll remember the next time I buy concealer, a burrito or new kicks.

Related reading: The best credit cards to use for food delivery services

Another added bonus is that you can also pay with Venmo through PayPal-accepted websites, since PayPal owns Venmo. This makes shopping even easier, especially if paying with a credit card isn’t an option at the moment.

Manage donations with Venmo

Venmo is the perfect place to raise money for a cause you care about. A few weeks back I decided to raise money for the George Floyd Memorial Fund over Instagram. By using a bingo board and listing my Venmo name, friends and family were able to donate to me on Venmo. I deposited these funds into my checking account and then donated to the GoFundMe. Without Venmo, I wouldn’t have been able to raise the additional $218 dollars. And it would have been much more difficult to collect cash and checks from my followers around the country.

Related reading: The best credit cards to maximize your nonprofit donation

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The physical card is easy… and cool

The main thing I like about the Venmo card is that it’s, well, cool. I ordered a black venmo card because I thought I could maybe trick people into thinking it was the Centurion Card from American Express (who am I kidding? I’m fooling nobody). At the time I applied, the card was only available in a few colors, but now you can choose among white, pink, purple, blue and black. I should mention that it is completely free to set up an account.

Earn 5% cash back from popular retailers when using the Venmo debit card. (Photo by Shutterstock)
Earn 5% cash back from popular retailers when using the Venmo debit card. (Photo by Shutterstock)

It is also contactless, which makes life so much easier because it is so much faster. When I studied abroad in 2019, contactless was the standard in Europe, and I got used to it. When I got back to the U.S., it was shocking how few cards had that capability. Contactless saved me a lot of time, especially on my lunch breaks. One tap, and you are ready to go. The Venmo card is accepted everywhere Mastercard is accepted in the U.S.

Split any purchase easily

Another great feature is that Venmo gives you the option to split costs with another Venmo user after using the card for a purchase. We all have that one frugal, or forgetful, friend who always takes forever to pay you back. Instead of waiting, charge them yourself or split the bill on the Venmo app to keep your funds up-to-date. This alleviates any reminding and frustration that comes with paying for others.

Use Venmo to pay yourself, and others, back

In college, I lived in a house with eight other girls. Yes, you read that correctly. Since we split utilities and cable nine ways, we used Venmo to keep the payments equal. My friend Amanda paid utilities with her debit card and then paid herself back with our funds we sent her through Venmo. You can also link a credit card to your Venmo account, but there is a 3% charge.

Budget with Venmo

Venmo is underrated when it comes to budgeting your monthly costs. If mom/dad/grandma or someone else gives you funds as a little gift, or maybe to pay for sustenance to keep you alive, use Venmo to budget yourself. My parents helped me pay for my food in college, so I could always keep track of how much I was spending on groceries.

The app is extremely user-friendly and purchases are always listed, so it is easy to see where you are spending a lot of your money. For me it was always Chick-fil-A and Andy’s Frozen Custard listed on my charges, so I tried not to remind myself that frequently of the calories I consumed.

Related reading: The best grocery credit cards for 2020

Another great way to budget is by setting up automatic withdrawals in $10 increments from your debit/bank account to keep your spending under control each month. These withdrawals can be turned on or off, but they will cover a charge when your Venmo balance isn’t enough. When you link your bank account, there is no fee for transferring funds to your Venmo balance.

(Photo by Westend61/Getty Images)
Setting up automatic withdrawals from your bank can really help keep your budgeting goals on track. (Photo by Westend61/Getty Images)

Venmo also allows you to set up direct deposit by giving a Venmo routing and account number. Both of these numbers are listed on the app, and it gives you another way to manage funds. If you work two jobs, have one direct deposit into your Venmo account for food and other daily expenses.

Safety and security

The safety of the card is another thing I value a lot. You can enable and disable the card with a touch of a button if it is lost or stolen. There is also no fee to replace lost or stolen cards. Venmo also uses encryption to keep your information private and secure. You can also add additional layers of security to your Venmo account, with a multifactor authentication and a PIN code in the app. I use my iPhone’s facial recognition technology to access my Venmo app.

Venmo FAQs

There are some commonly asked questions that pop up when using Venmo. One of these is "Can a bank account or card be added to two separate Venmo accounts?" Venmo states that you are able to attach a bank account to up to two Venmo accounts, but you can not add a credit or debit card to more than one account at a time.

Another frequently asked question is "Can I change where my payment is coming from?" Venmo does not allow you to change the method and amount of payment after it has been sent. It will first use funds in your Venmo balance, but if your balance isn't enough to cover the payment or request, then Venmo will automatically charge the cost to your preferred payment method. This is important to know because there isn't anything you can do once you hit "pay." I always look over the amount before I send it, and it's especially important to double-check whom you are paying.

Related reading: Can I use Venmo to meet my credit card's minimum spend?

Bottom line

While credit cards reap massive benefits, not everyone can use, or likes using, credit cards. Whatever your opinion might be, Venmo is a great option to maintain your funds while also redeeming some cash back along the way. With its ease of use and powerful safety features, the Venmo card is a great option for anyone to keep in their wallet.

Related reading: Using Venmo payments to meet minimum spending requirements

Featured image by (Photo by XanderSt/Shutterstock)

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TPG featured card

Best card for premium perks while traveling
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards

2 - 10X points
10XEarn unlimited 10X miles on hotels and rental cars booked through Capital One Travel
5X5X miles on flights booked through Capital One Travel.
2X2 Miles per dollar on every purchase, every day

Intro offer

75,000 bonus miles
Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel

Annual Fee

$395

Recommended Credit

740-850
Excellent
Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

Why We Chose It

The Capital One Venture X card is one of the best all-round travel credit cards ever launched. Not only is it offering a tremendous welcome bonus, but cardholders can earn tons of miles on everyday spending and receive a 10,000-mile anniversary bonus to boot. Its annual fee is $395, but cardholders can count on up to $300 in statement credits toward travel booked through Capital One Travel each year and other valuable benefits like access to Priority Pass lounges and Capital One’s own growing family of airport lounges.

Pros

  • Excellent welcome offer worth 75,000 miles after you spend $4,000 on purchases in the first three months.
  • Up to $300 in annual travel statement credits toward bookings make through Capital One Travel.
  • 10,000 bonus miles (worth $100 toward travel) each account anniversary.

Cons

  • The $395 annual fee might be expensive for some, but this card’s benefits provide much more value than that.
  • If you don’t travel frequently, this might not be the best card for you.
  • Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel
  • Receive up to $300 back annually as statement credits for bookings through Capital One Travel, where you'll get Capital One's best prices on thousands of options
  • Get 10,000 bonus miles (equal to $100 towards travel) every year, starting on your first anniversary
  • Earn unlimited 10X miles on hotels and rental cars booked through Capital One Travel and 5X miles on flights booked through Capital One Travel
  • Earn unlimited 2X miles on all other purchases
  • Unlimited complimentary access for you and two guests to 1,300+ lounges, including Capital One Lounges and the Partner Lounge Network
  • Receive up to a $100 credit for Global Entry or TSA PreCheck®
  • Use your Venture X miles to easily cover travel expenses, including flights, hotels, rental cars and more—you can even transfer your miles to your choice of 15+ travel loyalty programs
  • Named editors' choice for "Best New Credit Card of 2021" by The Points Guy
  • Earn 10 miles per dollar when you book on Turo, the world's largest car sharing marketplace, through May 16, 2023
Best card for premium perks while traveling
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards Rate

10XEarn unlimited 10X miles on hotels and rental cars booked through Capital One Travel
5X5X miles on flights booked through Capital One Travel.
2X2 Miles per dollar on every purchase, every day
  • Intro Offer
    Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel

    75,000 bonus miles
  • Annual Fee

    $395
  • Recommended Credit
    Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

    740-850
    Excellent

Why We Chose It

The Capital One Venture X card is one of the best all-round travel credit cards ever launched. Not only is it offering a tremendous welcome bonus, but cardholders can earn tons of miles on everyday spending and receive a 10,000-mile anniversary bonus to boot. Its annual fee is $395, but cardholders can count on up to $300 in statement credits toward travel booked through Capital One Travel each year and other valuable benefits like access to Priority Pass lounges and Capital One’s own growing family of airport lounges.

Pros

  • Excellent welcome offer worth 75,000 miles after you spend $4,000 on purchases in the first three months.
  • Up to $300 in annual travel statement credits toward bookings make through Capital One Travel.
  • 10,000 bonus miles (worth $100 toward travel) each account anniversary.

Cons

  • The $395 annual fee might be expensive for some, but this card’s benefits provide much more value than that.
  • If you don’t travel frequently, this might not be the best card for you.
  • Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel
  • Receive up to $300 back annually as statement credits for bookings through Capital One Travel, where you'll get Capital One's best prices on thousands of options
  • Get 10,000 bonus miles (equal to $100 towards travel) every year, starting on your first anniversary
  • Earn unlimited 10X miles on hotels and rental cars booked through Capital One Travel and 5X miles on flights booked through Capital One Travel
  • Earn unlimited 2X miles on all other purchases
  • Unlimited complimentary access for you and two guests to 1,300+ lounges, including Capital One Lounges and the Partner Lounge Network
  • Receive up to a $100 credit for Global Entry or TSA PreCheck®
  • Use your Venture X miles to easily cover travel expenses, including flights, hotels, rental cars and more—you can even transfer your miles to your choice of 15+ travel loyalty programs
  • Named editors' choice for "Best New Credit Card of 2021" by The Points Guy
  • Earn 10 miles per dollar when you book on Turo, the world's largest car sharing marketplace, through May 16, 2023