Last week I got an email from someone at American Express asking if I’d be interested in doing some Christmas shopping (at their expense) and blogging about it. To really make it enticing, the offered to give a $250 gift certificate away to a reader of Productivity501. (See below for details.)
So here is the plan. In this post I’m going to discuss some strategies for getting the most out of your credit card benefits and rewards programs–particularly related to Christmas shopping. I’ll use American Express as an example, but most everything will relate to other cards as well. Then I’m going to try to buy 5 gifts for family and follow up with a post on what I found in a week. In that post we’ll try to announce the winner of the $250 gift card.
Rewards Programs
American Express has one of the most extensive rewards programs of any credit card company. However, you have to know how to value your points. Usually points amount to about 1% benefit from every dollar spent, however different programs have different amounts of payback. For example, if you redeem your points for a $10 bath and body works gift card right now, it will cost you 800 points (normally 1,000). This works out to $0.0125 per point. However, if you shop Amazon and use the American Express Pay with Points at checkout, your points will be worth $0.007 each.
If you decide you want to buy a Kindle E-Reader through American Express’ online Membership Rewards store, it will cost 25,200 points for a wifi model that sells for $139 from Amazon. So the value of your points there is $0.0055 each ($139/25200). So if you have 50,000 points you are working with, that means the value can range from $275 to $625. That is a pretty big range. If you can spend your points on things that have the best conversion rate and pay directly for the expenses/items that have lower conversion rates, you points will go a lot further.
Generally I try to look for things where 1 point = 1 cent. Usually your best deals from American Express are going to come in the form of gift cards and travel where the exchange rate from points to value is usually 1 cent or higher.
So when it comes to Christmas shopping, you may find the best value in using Membership Rewards Points to pay for your Christmas travel or even buy a gift card to use to purchase a gift, than to buy a physical item directly with points. (Or you could give gift cards, but I’m not a big fan of those as gifts.) However, this isn’t a hard and fast rule and it depends a lot on what special promotions are being held. Just remember to divide the value of something by the number of points it costs to get an idea of the exchange rate. If it is too far below 1 cent you might want to save your points for something else.
So that is a bit about how to spend points, but it is worth looking at some of the ways you can earn them.
American Express has what used to be called an online Bonus Points Mall. As I mentioned previously, you typically get 1 point for every dollar you spend. In the Bonus Points Mall, AmEx has made agreements with merchants to offer significantly greater bonus points for each purchase. For example, if you buy a new computer from Apple for $1,200, you’ll usually get 1,200 points, but if you go through the bonus points mall right now, you’ll get 6x that amount or 7,200 points. If you are eventually able to redeem these points for $0.0125, that is an additional $90 in savings off the computer.
Not everything we’ve talked about in this section applies to other credit cards, but a lot of it does. The point is that you have to sit down and do the math to understand how to benefit from the rewards you are offered. If you are careful, you can often get twice or more value out of your points/rewards program.
Special Offers / Deals / Card Features
Outside of the points programs, it is worth understanding all the deals, incentives and benefits your card offers. For example, American Express is running a program this Saturday where they will give you $25 statement credit if you buy something from a small business. You have to register your card ahead of time and I think there may be a limit on how many people they accept, but I tried it a few minutes ago and it let me register. So Saturday I’m going to be looking for some Christmas gifts from a local small business.
Some other features that are worth looking at:
- Amex offers a credit for extra airline fees (including extra bags) on their Platinum Card. (You have to select your airline once per year and there is a $200 yearly limit, so it isn’t completely open ended.) If you are looking into traveling this Christmas season, definitely look into this if you have a Platinum Card.
- We’ve talked about some of the Concierge Services in the past. I’ve actually been pretty impressed with them recently. I think it just takes awhile to learn what they are good at and what can be done better on your own. This can be a great way to try to find gifts that you might not think of or when you are trying to do something for someone who is a long ways away and don’t have time to call a bunch of stores near them.
- Purchase protection – Many cards like the Platinum offer some type of purchase protection if you buy something and it gets stolen lost or damaged.
- Some cards offer a price increase protection. If you buy something and the price goes down, you get a credit for the difference. As far as I can tell AmEx doesn’t have this anymore, but they have a 90 day return protection that looks like it will do essentially the same thing.
Some tips for shopping with a credit card
Credit card companies watch your spending patterns pretty closely. If someone steals your card, they want to shut it off as quickly as possible so they aren’t out thousands of dollars. This means if your spending goes up rapidly, they may cut off your card until you call in and confirm that you have it. Now I’m sure most companies expect to see a jump around Christmas, but if you are doing something like shopping in a different city, you might want to call your credit card company and just tell them what is going on ahead of time.
Watch the register when you checkout. One downside of using a credit card is that it is easy to not watch things as carefully when you check out. With cash, we tend to be a bit more careful because we don’t want to run out of money at the register. You want to make sure things are ringing up for their expected price–particularly when buying items that are on sale.
Christmas Gift Buying Tips
Now that we’ve spent over 1,000 words discussing the way to get the most benefit from using a credit card, lets look at the fun part–actually buying gifts. Here are some thoughts for your consideration.
- Don’t let Christmas turn into a gift card exchange. If you just want to give each other gift cards, you are better off setting a bowl on the table and have everyone throw in $50 and then take it back out again.
- Go in with other family members. By combining your funds you may be able to get someone something that they really want but would never go out and buy for themselves.
- Invest some thought. When buying gifts for people who are close, you goal should be to show that you know them well enough to buy something they will really like.
- Buy used. It may not work for every family, but there are some great deals out there on used items.
- Swaps. I’ve heard of communities getting together and having a big swap where they exchange gently used children’s toys. You give something that your kids no longer play with and get something fresh and exciting.
- Do something. When you have well established families, you may not really need more stuff. What if you were all to pool your money and go on a family vacation over the holidays?
- Gift exchange. If you have a large family, it can make sense to draw names and have everyone get one gift for one person. If done correctly, this can make shopping a lot easier because you can focus more time and money on making a single gift perfect instead of buying 30 presents for different people.
- Start early. If you have the storage space, you can probably find the best deals by doing your Christmas shopping throughout the year. When you find the perfect gift for Uncle Bob for 50% off, get it and put it somewhere you will remember it.
- Set a budget. Christmas can turn into a free for all. Set some type of budget for the season so your spending doesn’t get out of control. While it is nice to be generous, you should be responsible with your money.
- Be careful what you teach your kids. Growing up, we’d open stockings, eat breakfast and then take cookies to the local nursing home for a few hours before coming home and opening presents. As children this helped us learn to focus on others first.
- Don’t over do it with kids. I’ve seen parents wear their kids out at Christmas. Giving your kid 20 toys that they isn’t going to make 10 times happier than giving them 2 toys. It might even do the opposite because it is impossible for a kid to focus on 20 new toys at the same time.
- Plan for others. I have seen some situations where family members don’t come to Christmas because they can reciprocate with similar gifts. Don’t let a focus on gifts get in the way of spending time with family.
$250 American Express Gift Card Giveaway
- Add a comment to this post with a Christmas shopping tip to enter.
- Tweet a shopping tip with a link to this post for another entry.
- Winner will be chosen randomly, but we reserve the right to moderate comments.
- You have to be in the US to win.
- The winner will have 24 hours to respond before we select another winner.
- Winner will be chosen in one week.
I avoid giving gift cards like the plague. I hate it when I receive them, and often, they indicate that the person knows who I am and the kinds of stores I go to less than if they give cash.
create a unique, original item or experience to present as a gift. Be mindful and give from the heart!
I have a rule that I always give a gift that a person either would not or could not get for themselves. That way, it’s truly a gift. If they would/could get it for themselves, they may just eventually do so. This isn’t meant to be stingy, but instead, to surprise and delight the receiver of the gift. :-)
Save receipts just in case someone needs to take something back. Some stores even have gift receipts. They might get a duplicate or not fit. They can also help you track how much you’ve spent.
I had never thought of looking at how much the points cost for each item I could buy with my rewards program. I’ll have to pay attention to that and maximize my card’s potential. I don’t have Amex but the card I have also offers cash back at certain point levels. I wait until it’s rather high and then cash it in for $250 or $500. The cash is a better deal because I can often buy the items my reward program offers at a better price with the cash than with points.
One of my favorite holiday tips is actually my signature gift wrapping. Each year, I choose a different theme and then all of the gifts I’m wrapping for family and friends are decorated similarly.
Examples? One year when I was extremely broke, all packages were wrapped up with brown paper and tied up with strings (how Julie Andrews!). I had a little glitter spray and I sprayed the strings for just a little sparkle. The result of having a uniform collection of gifts under the tree is always breathtaking.
The gift recipients often stare at the beauty of the package. Something about a specially wrapped gift makes people feel like they special, too.
This year I bought my wrapping paper online from a supply house that sells to department stores. The bigger roll was much cheaper than if I bought several different rolls at a retail shop. This year’s theme is a green-on-green brocade design and instead of fabric ribbons, I’m hand-punching ribbons out of paper. The gift tags are also home made.
By shopping early (I’m usually close to done by Halloween), I then have two months to leisurely enjoy the season and wrap gifts when I have a little spare time.
Excellent idea! My grandmother used to always wrap presents in the Sunday comics from the newspaper.
Yep! Comics, old maps, Chinese newspapers, gift tags made from interesting magazine photos….the art of the wrapping (to me) is as important as the art of gift giving.
It is a lot easier to find a great gift for someone if you pay attention to them throughout the year. Even if you only see them a couple of times, pay attention to what they use and wear (check out their facebook likes, tweets, see what they have been reading via linkedin, etc.) and go from there. I dislike that feeling of only starting to think of what to get people 1-2 weeks before Christmas (or birthdays for that matter).
Good advice. The best gifts are the ones where the recipient is amazed at how you were able to find something that they really wanted.
My Christmas shopping tip is to ask for a store map and cross-check it with your shopping list so you know exactly which aisles to head straight to. It saves a lot of time.
tweet — https://twitter.com/#!/mami2jcn/status/140083392048930816
Check http://www.evrewards.com before buying anything online. This site lets you know about bonus points and rebates different programs offer for buying from each online vendor. For instance, you can see what kind of rebate is available through sites like ebates, and whether your Amex or Visa card offers bonus points if you buy through the credit card’s online mall.
Some really good tips on maximizing benefits… hanks!
I think it’s a good idea to start with an inventory of what you’re able to give. This includes a budgeted amount of money but also time and resources. That way if you decide to give acts of service (for example) you know exactly how much time you have to give rather than accidentally running yourself ragged.
Use coupons and don’t buy something that you don’t like/need just because it’s a good deal
http://twitter.com/#!/ElenaIstomina/status/140133947119112194
Save up all year round and keep all the gifts in one place. This way you can use coupons and not be stuck with a huge Christmas bill!
Because of the nature of my work, (holiday’s are typically the busiest time of year) I find myself every year in a battle to get home in time for Christmas. This has led to my favorite holiday tradition of “last second Christmas mayhem.” As I’m rushing home from work the day before Christmas Eve, usually somewhere around 2AM, I’m already mentally preparing my Christmas list, because, lets face it, I’m a guy so procrastination is the only way to truly experience the last second Christmas shopping mayhem! I then try to grab a couple hours of sleep before jumping in the car with my wife and making a “mad dash” for the nearest store. Using my best “Dale Jr.” impression I begin frantically steering my shopping cart around and through the masses in hopes of finding the items on my last second mental list. (BTW, the nice thing about making last second mental lists is that they are so fluid, easily adaptable to empty shelves or angry mom’s yelling about that item you just hoisted from their cart) Once I’ve exhausted the stores’ gift possibilities, I again jump in my car and begin the “traffic experience.” This usually consists of lots of pounding on my steering wheel while constantly complaining to my wife that I could walk faster than traffic is flowing. After the 1-2 hr car trip to the next store. (Just down the road about 2 blocks) We begin the Dale Jr routine all over again and repeat as necessary throughout the day. Occasionally I can complete a circuit of up to 5 different stores, but usually my attitude suffers beyond my wife’s ability to cope and she make’s me return home with some “lame” gift card that yells, “I couldn’t think of anything to get you so I gave up.” (Obviously this would never be true of myself, since it was only my wife’s dedication to maintaining some semblance of my own moral and ethical standard that caused the defeating purchase of said gift card) I then proceed to rate my experience based upon the following formula:
((Actual gifts purchased) / (Number of gift recipients)) – (.25 points per gift card purchased) – (.25 points per use of any of the following: colorful language, theft from another shopper, pushing or shoving small children) + (.5 Bonus point for completing circuit of 5 or more stores without using aforementioned techniques).
I am usually hoping for a score in the range of .25 to .50 on a good day. =) A perfect score of 1.5 (including bonus) is considered an idealistic but unattainable shopping goal and should not under any circumstances be used as a basis for self-condemnation.
Congratulations on having one of the most detailed ways to wait until the last minute for holiday shopping. :)
I have a price book so I know where the bottom line is when it comes to something we need/buy. Learn store policy regarding price match, return and else, either online or in-store. Always search for the best price and coupon codes for online shopping, plus go through cash back sites (esp. during holidays, most sites double cash back!) to maximize saving.
tcarolinep at gmail dot com
What type of price book do you have?
tweet.http://twitter.com/#!/tcarolinep/status/140216206383783936
My Christmas shopping tip is to set a limit for each person’s gift and to only shop sales to help with that. I also resuse Christmas gift bags to save money when wrapping others’ gifts.
So does the limit for each person vary depending on how much you like them for that year?
My parents used to have some boxes where the box and the lid were wrapped separately. You’d open the box to get the present without destroying the paper and it could be used again next year.
http://twitter.com/#!/aes529/status/140218503885103107
The rules (in order of importance) we live by when shopping are:
1. It has to fit perfect, look great, or be the exact right item
2. The price has to be right
If you reverse the rules and the price is more important than the utility of the item you will tend to buy more and regret more.
Here’s a unique option for Christmas giving: “Give a Goat” (or other animals to those in need.)
https://secure1.heifer.org/gift-catalog/goat.html/?msource=kw2516&gclid=CJfsraCv06wCFcfv7Qodwy3yrg
Heifer.org is a charitable organization that encourages you to choose a meaningful gift to give a loved one and help children and families around the world receive training and animal gifts that help them become self-reliant. You can pay with your credit card.
I stay within budget by using discount coupon codes from retailmenot and ebates cash back. I find better deals online because I have time to search for the better price and I don’t impulse buy
I use coupon code and shop on line, save gas money. I also compare the price before i place order.
http://twitter.com/#!/HappyTina0115/status/140596459954376704
I’m not sure that Christmas shopping is one of my favorite activities – although I do enjoy all the poeple, the occasional fistfight and those agressive mall kiosk sellers, its the gift selection for each person that is the biggest frustration. I reaally enjoy giving gifts, but I really want to get them something they want.
After some thought I figured that the easiest way to remedy this, was to create an easy way for familiy to input their Christmas wants and a way to mark if that particular gift was already taken. After experimenting with several “gift registry” websites – I gave up. They all wanted too much information, were complicated or some other reasons I wasn’t happy …
So, I created my own through google docs – I created a page for each person in our famliy. Then we all had a week make a wish list (parents did this for their children). The categories were gift, where the gift could be found, price and rated how bad they really wanted that gift. An additional field was a toggle – so when someone purchased the item, they could go in and mark the gift had been purchased!
This make my shopping expereince much more pleasant!!
https://mobile.twitter.com/claytonwhitson/status/140568790936203264
I use a spreadsheet to track gifts, with columns marked ‘ideas, planned, ordered, rec’d, wrapped, given’. It helps me not overspend because I can easily see when enough is enough. Throughout the next year, I can add ideas for other gifts, and come December I can quickly adjust my list as the family has grown or shrunk.
Terrific idea, Karen!!
My tip is to avoid using credit cards and use cash instead. This helps me in a big way not to overspend and stay within my budget. If I use a credit card I tend to overspend.
Love this tip too!!!
Tweet
https://twitter.com/#!/disneyfan40/status/140887322303533056
my tip is to keep a list and stick to it
https://twitter.com/#!/annatiffany2/status/140935564651270144
Buy fairly traded goods, such as from Ten Thousand Villages. http://www.tenthousandvillages.com/
That’s an interesting site!
Have a set amount you plan to spend, and log it daily leading up to Christmas.
Shopping early in the week and early in the day often means better selection and more rested, helpful sales people.
Avoid using your cards by making your gifts…Quilting, knitting or baking makes for gifts from the heart!
Wrap presents as you buy them to avoid any additional last minute stress.
Make a plan before your shop. I usually will go online and search for the items I’m looking for before I make a purchase.
For adults consider gifts that don’t have to be stored and dusted. Unique food items from your town for relatives far away. A donation to the Hefer Project or other charity in their name. Where possible I like to spend some time wrapping stuff to be unique. An origami box for small items. Wrap one present in newsprint another in glossy magazine paper. For small wrapping consider one page of printout of your favorite picture, or of the recipient and yourself and skip the To: From: label. Save small ornaments (particularly wood) and use them as decorations on packages. If you receive one on a package, add to the Tree if appropriate or have a box to save for decorating on gifts next year. We have had some small wooden decorations bouncing around between family members for 10+ years.
My thoughts are to give something truly personal to the recipient – what will they treasure most – is it something they need and can’t afford (but is still within your budget); will it be a total surprise to them?. Think throughout the year of the people you will be buying for; purchase whenver you see the item when possible; set aside a specific place to keep the gifts you’ve purchased for people. Have a few extra fairly inexpensive gifts on hand for those last-minute needs (think of male and female). I most like using family photos – they are personal, meaningful, unique, beautiful, cherished.
Make your list of people, keep track of your spending, know where you stand, ship early. Enjoy the meaning behind gift-giving – whether at the holidays or during the year.
Similar to “Be careful what you teach your kids” and “Enjoy the meaning behind gift-giving” (found above), my recommendation is to remember Christ in Christmas. It can be done, even when shopping!
I try to buy gifts that the recipient can use, preferably a gift that the recipient would not purchase themselves, but one that would actually impact their daily life. Although, when the budget is tight, and the practical gift you give is an extension cord, you may get teased about your ‘practical gifts’ during the coming year! It is a gift that is sure to get used though!!
One of the best gifts I can think of is an extra power cable for someones laptop so they can leave on at their desk and keep the other in their computer bag.
I have to second this idea. It is one of my favorite conveniences.
Buy art! (or make some of your own to give!)
There’s also a really cool website called Living Generously that lets you buy things for people in need. They give you a card that you can send to the people you gave on behalf of.
http://www.livinggenerously.com/shop/product/136
I “shop” through out the year picking up different items that are on sale I also enter contests to win
prizes to give as gifts thanks and have a great day
My tip is to start earlier if you are a December shopper. I have finally broken down and done this so that I wouldn’t be pressured into buying something as it gets too close to Christmas to get it shipped in time. Now, I know I have a week or two to make final selections rather than get the whole thing done.
My best tip is to keep a running list of gift ideas during the year – both for others and yourself. When you think of the perfect gift for someone, or when they mention “Oh, I’d really like/need …” you can make a note of what to get when you do your shopping. Way easier than stressing out about what to buy everyone at the last minute. And keeping a list for yourself is great for when parents/family/friends ask what you want (my family literally asks for a copy of my list, both at Christmas and at my birthday).
I dont celebrate chrstmas, but in general my shopping tip is i always buy someone a practical gift ..Thanks for this splendid giveaway
I tweeted at http://twitter.com/#!/anashct/status/142119839845199872
My shopping tip is to buy all year round. When you see deals buy them and put them back for when a holiday/birthday comes!
tweeted!
http://twitter.com/#!/JenniferCNP/status/142457772670320640