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Deciding what to buy, when to buy it, how to pay, and whether it’s worth the price. Get more for every dollar you spend.
A carrier’s free phone is usually 36 monthly bill credits, and they stop if you leave the qualifying plan. Before you sign, multiply that plan’s extra monthly cost over the plan you’d otherwise pick by 36, add what your trade-in would sell for, and compare the total with buying the phone outright and selling your old one.
Before you buy online, click through a cash back shopping portal to the store you already planned to use. The store pays the portal a referral commission, and the portal passes part of it to you, on top of your card rewards. Use it only for purchases you would make anyway.
A new car loses value fastest in its first years, so let the first owner absorb that drop. Shop for cars two to three years old that still have the factory warranty on the engine and transmission. Line up your loan first, since used-car loans usually carry higher rates than new-car loans.
If you earn self-employment income, run your business expenses through a business credit card and keep personal spending off it. The statement becomes a running record of your business costs at tax time, and you earn rewards on spending you’d do anyway. Pay the balance in full each month.
Owning a new car costs about $12,900 a year on average once you count depreciation, financing, insurance, fuel, upkeep, and fees, according to AAA. Before you buy, add up those costs for the exact model you want, and judge the car by that total instead of the monthly payment.
When you want something you didn’t plan to buy and don’t need, put it in your cart and wait 24 hours, or longer for a big purchase. The 24-hour rule lets the rush of the moment fade, so tomorrow you judge the item itself. If you still want it at that price, buy it.
The mortgage payment your lender quotes leaves out upkeep. Before you buy a home, add 2% of its price per year for maintenance, plus any homeowners association dues, and check that the property tax estimate uses your purchase price. Then bank the gap between that total and your rent for three months to test whether you can carry it.
Buying a home only beats renting once your equity gains outweigh the extra costs of buying, owning, and selling. For a typical home nationally, Zillow puts that at about eight years. Before you buy, compare how long you’ll realistically stay with your area’s break-even. If you’ll likely move before you’d break even, keep renting.
No single cash back card pays the top rate on everything you buy. Pair a category card that pays extra where you spend the most with a no-fee card that pays a flat 2% everywhere, and put every purchase on whichever card pays more. Make sure the category card’s extra rewards exceed any fee.
Price each point at the redemption you’ll actually use before choosing points or cash back. Statement credits and gift cards top out around a penny a point, so two points per dollar pays 2% or less. If you won’t book travel that gets more than a cent per point, choose cash back.
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