How to pay for your gifts?
During the holiday season, using the right credit card can help you offset expenses and earn rewards on purchases you would make anyway, provided you plan your spending and pay off your balance in full. The best credit card depends on what type of holiday shopping you plan on doing. You can buy gifts with a credit card at most retailers, both online and in physical stores.
It's smart to consider credit cards with rotating bonus categories or with categories of your choice that often include major retailers or online shopping. Such cards allow you to earn more rewards in specific categories this month or this quarter. Just keep in mind that you usually need to activate such categories with higher rewards each month or each quarter. Otherwise, those categories will earn basic rewards offered by the card.
The holidays involve significant spending on groceries and dining out. Using a card that offers accelerated rewards in these categories can quickly build up points or cash back for future use. The Bank of America® Customized Cash Rewards credit card , for instance, offers 6% cash back (3% cash back + 3% first-year cash back bonus) in the category of your choice for the first year, like gas, dining, or online shopping, 2% at grocery stores/wholesale clubs, and 1% on everything else, with a $2,500 quarterly cap on bonus categories.
For all other purchases, a flat-rate cash back card, such as the Citi Double Cash® Card, which earns 2% cash back (1% when you buy, plus 1% as you pay), can ensure you are always earning rewards. Plus, it offers to earn 5% total cash back on hotels, car rentals and attractions booked with Citi Travel.