Money Saving Tip: Credit Cards for Gift Card Savings

One of the easiest, low effort ways to save MONEY is to use your credit cards effectively.

Hopefully everyone that has a credit card has Cash Back Rewards.  It is the easiest way to save money if you disciplined enough to have a credit card.  To start most cards give you 1% back on all your purchases.  And Capital One even gives you a 50% bonus on all the rewards you earn at the end of the year so basically 1.5% back!

Chase Freedom card is making a come back by offering quarterly rewards on Categories where you can earn 5% back.  This first quarter of the year is Starbucks, Drugstores and Gas Stations.   And thanks to a poster on Slick Deals, I found a genius no effort way to discounted gift cards.  

At Drug Stores like Rite Aid, there a ton of No Fee gift cards like the Home Improvement Card, Macy's, and other retailers.  Buy buying your gift card at Rite Aid you'll get 5% back!! So in a sense it's an easy 5% discount on Gift Cards.  Near the end of the promo, I even plan on getting a Rite Aid gift card to help me save even further!

Discover Card does the quarterly rewards special as well.  And it would be a great time to get gift cards to restaurant gift cards not at your local drug store. Hint: even McDonalds!  The reason Discover remains my favorite is they offer discounted gift cards as part of their Rewards Redemption as well, so you really can stretch you savings with them.  And not to mention if you Shop Discover some retailers like Groupon allow you to get 15% back!

Ultimately, my strategy this year is to charge all my non special things like utility bills on my Capital One Card for their effective 1.5% back on everything.  And rotate my special purchases like Movies to the appropriate Cash Back Bonus program and to save ahead with Gift Cards!

Money Saving Tips : Employee Perks

Maximize your Employee Perks

Aside from Health, Transit, and Legal benefits that many companies provide there a lot of little perks you may not be aware of that can really help keep more of your hard money in your pocket. It varies for each company but here are some to be aware of.

Company Pantry.  Buying Coffee and Milk at home even, on average can easily cost you $10 a month.  So it was a real perk that my work place has unlimited high quality Coffee, Hot Chocolate, Tea and Creamer. I also fill my Water bottle with their filtered water.  If you want to be extreme depending on your companies security you can even take some home gradually so you don’t even have to pay for your weekend fix.  Obviously, I wouldn’t do it if it could cost you your job for theft.

Bathroom.  If you pay for your utilities like water, going to the bathroom at work versus at home can help you save on electricity, water and toilet paper expenses.  I started going AM, MID day and just before I leave for home and you will notice especially that you need to refill your toilet paper a lot less.  And If you work at a pretty posh, office the bathroom can be a source of unlimited paper towels.  Mines, still hasn’t upgraded to the rolling dispenser instead it has the individual hand paper towels that are so easy to just grab a bunch and take home.

Cafeteria/ Kitchen.  It can be can be a great source for free utensils and condiments.  The best part is I use the Freezer to store my Batch Cooking meals!

Conferences/Parties/ Meetings.  If you work for a particularly wasteful company, you will find that after big conferences where they feed guests, there’s always yummy left overs. Same goes for parties and events like Bagel Fridays or occasional Pizza for stressful days.  I always make sure I have empty Tupperware for those events so I can take home what is left over and it literally will save you the cost of your next meal.

Meal Perks.  Some companies will give you money for meals when you work Overtime.  When that happens, instead of spending it on a Lobster dinner, I skip on appetizers and drinks, and just go for buying as many items that I can covert to multiple meals.  For example, instead of buying Sushi, I’d go for cheaper Thai or Chinese meals and try to order things like meat dishes.  So that ways, I could take it home and stretch the meat by adding veggies to the dish.

Employee Discounts.  Some companies can offer you discounts on everything from clothes to cell phone plans, definitely worth looking into. 

Entertainment.  One of the companies, I worked for when you showed your ID, you got free admission to practically every museum in the city.

Printer.  One of the companies, I worked for had a really relaxed internet and printer policy.  So basically I got to print everything I ever needed via the company printer.  I saved so much money on Printer ink which is quite expensive.  And I mostly printed coupons which helped me save even more!

These are the ones I immediately thought of I’m sure there are lots more depending on where you work.

Money Saving Tips : Paycheck

The most important thing in this journey of Frugality is your INCOME aka Paycheck.  It’s typically for most Americans the main source of your purchasing power.  So ABOVE anything, it’s important the foundation of your Finances is set up properly.  TAXES is very important component in how I navigate my finances and considering for the average New Yorker it eats up on average 25% of all your earnings its not an expense to you want to ignore.  So I listed the 4 most important things I always make sure to be aware of  in regards to my Paycheck.

Make sure you’re claiming the proper withholdings so you get most money back from each Paycheck.  Most people I know get really excited to see a big IRS refund check.  If you are someone who has stayed in same income range and is consistently getting back huge refunds each year, you should consider talking to your Tax Advisor about adjusting your withholdings.  In my head, a huge refund means you basically gave the Government a big fat free loan of your hard earned money.  Money that should have been in your pocket after your pay check was paid to you.  Money that could have been earning interest!

It’s a little tricky to figure it by yourself considering as I am writing this we’re still dealing with the Fiscal Cliff and taxes next year feel like the wild wild west even for seasoned accountants.  But if you have a friendly payroll department, you can always ask if you can submit a W4 correction anytime of the year.  Meaning possibly, decrease your withholding so you get more money from each paycheck and as the fourth quarter hits assess your tax situation and possibly increase your withholdings if necessary.

The Flexible Spending Account.  My personal opinion, if you are lucky enough to have this Benefit from your employer take it because not every employer offers it.  I would jump at the opportunity to reduce my taxable income.  To illustrate my point, if you earned a $100 and you are in the 25% tax bracket.  Your take home pay would be $75 after taxes.  The blood, sweat and tears you put into earning that original $100 immediately once it gets hit with taxes, gets reduced down to $75!!!  Once your earnings, become taxable your purchasing power gets immediately reduced by your tax bracket (in this really basic example) 25%.

If you move your pre-tax income of $100 to your FSA, it will go to a separate account as a $100.  And you can use that money to pay for Co-Pays, Prescriptions, Root Canals and other eligible expenses. 

More and more employers are switching to more HMO like health care plans.  Which means you are paying more and more out of your own pocket when you visit the doctor and dentist.  So if your company offers a FSA, option estimate how much you think you will need and this will allow you to use your Pre-Tax Dollars to pay for your eligible medical costs.  Pro: is you are reducing your taxable income (so it’s like saving 25% if that’s your tax bracket).  Con:  Your take home pay is reduced by your contribution and if you don’t use the funds set aside you, lose it. 

Even better, and this depends on your Company’s plan and administration procedure is when you can use your FSA almost as a 0% interest loan tool to pay for an expensive eligible medical procedure.  Here’s an example, let’s say I let me my employer know I wanted to have $1200 set for my 2013 FSA.  Each pay check I have in 2013 will know have a $50 deduction (contribution total/ 24 bimonthly paychecks).  In February, I have expensive Root Canal and charge the $1000 expense to my credit card.  My FSA plan allows me to then submit my receipt for the Root Canal and it will pay me back $1000.  Even though, so far I’ve only contributed $100 via my paychecks.  My paychecks will continue to get the small deduction, taken out till the end of the year but I didn’t have to wait for my deductions to total $1000 before having my procedure.  Hence, why it’s almost like a 0% interest loan.  On top of that since I paid for original procedure with my Cash Rewards Credit card that earned me an additional 1% in rewards!

401k, Pension, Traditional IRA’s.  Contributions to these retirement plans usually come from your Pre-Tax Dollars so it’s definitely worth looking into.  Again, you should consult with a tax advisor of some sort to make sure you qualify and the amount you can contribute.  I won’t get into much since we are in what I consider a recession and most people can’t afford to contribute to these plans right now.  But if your employer does a matching plan, look at the terms carefully as companies are much more stingy these days and typically require a length of employment before they kick in funds.  But hey free money is free money.  And as many books, will say Retirement plans are very important.

NYC Transit Checks.  If you are a New Yorker in the TriState area and your employer offers this …get it!! I would say this is one of the best benefits ever because everyone shells out money for a Metro Card, its unavoidable unless you drive or bike to work.  It basically allows you to use your Pre-Tax Income to buy Metrocards.  The savings is amazing and this is one benefit you can be sure you will be able to use.  Again on the most basic level if your paying 25% in taxes, then it’s about a 25% discount on your Commuting costs!

I actually go take the max amount possible. And use the left over funds to buy more than I need.  For several reasons, you never know about job stability and whether or not your next employer will offer this benefit.  If you are a New Yorker, you know you will need to buy a Metrocard, its inevitable.  And so having extra Metro cards at such a discount is Definitely worth it!  And if you really need to get rid of them there are plenty people you can give these to hint hint family members and friends.  Because even if you give it at a 10% discount, you have probably saved way more since it was done at a pre-tax level.

**None of this should be construed as financial advice and the tax example is more just to help illustrate my point, actual taxes are much more complex and not flat.