Chipping Student Loans Away through Shopping

New Year’s is just around the corner, and it looks like I’ll get to celebrate fulfilling one of my 2011 resolutions: pay off one of my graduate school student loans! In three years, I chipped away a $15,550 student loan balance, which now stands at just over $200. I’ll use some Christmas money to finish it off, and should ring in the New Year with one less student loan to deal with (but 2 smaller ones to go).

Besides making payments on the loan during deferment, I used two shopping tools to help me work on that loan: UPromise and ThankYou points.

I’ve covered the UPromise program before, but to summarize, it’s primarily based on a shopping portal that gives cash back to users. The cash back balance can then be applied against a Sallie Mae student loan account, transferred to a 529 education savings account, or redeemed for cash. The cash back rate is often not as high as that from Discover’s ShopDiscover or Chase’s Ultimate Rewards Mall, but every so often I come across retailers that are not partners with either of these two but are in the UPromise portal.

Not that credit cards don’t help with student loans. Over the last two years, Citi’s ThankYou points program has been vital to erasing my student loan balance. I have the CitiForward credit card, which offers 5 Thank You points per dollar spent on books, movies, music, and, most importantly, restaurants, and 1 point on everything else. These points can then be redeemed for gift cards and cash, but also cheques to pay student loan or mortgage balances! Until September 2011, to get a $100 cheque, you needed 12,700 points, but since then the requirement has dropped to 10,000 points. There was no official announcement about this change, so I don’t know how long it will last – if you’re sitting on any ThankYou points and have a student loan or a mortgage, now might be the best time to redeem them.

Now, 12,500 ThankYou points trade for $125 in Student Loan Rebates. In April, 12,700 points were required for $100.

Admittedly, at 10,000 points for $100, this is the same redemption rate as for, say, a Banana Republic or a Macy’s gift card. However, I’ve found that it’s a lot easier to spend money shopping than it is to put money aside to pay off my student loan more quickly, so I prefer redeeming ThankYou points for student loan payments since it’s a way to force myself to pay down the loan with money that never made it to my hands in the first place. Besides, the redemption rate for student loans and mortgage payments is much better than for cash: $100 in cash costs 16,000 ThankYou points.

To redeem ThankYou points for student loan or mortgage payments, all you have to do is call the ThankYou network (1800-THANKYOU) and give them your lending company’s name. They will then mail you the cheque, which you can send to your lending institution along with a note with any special instructions on how to apply the payment (e.g., post everything to the loan with the highest interest rate or to the one with the smallest balance). For UPromise, even though the payments post automatically, you can also call Sallie Mae to request a change to how any payment is applied.

With less than two weeks of 2011 left, if you are also aiming to making a big chip on your student loan or mortgage balance, now might be a great time to ramp up the online purchases you make through UPromise or to redeem your ThankYou points for loan payments. The fact that now you only need 10,000 ThankYou points for a $100 cheque not only sweetens the deal but may also be the push you need – it’s not clear how long this new rate will stick around.

And if it’s too late for 2011, here’s an easy 2012 resolution for you: set up and remember to use UPromise or the ThankYou network to get rid of your student loans next year. Good luck, and have fun watching your loan balance disappear!

Soon, No More Free Trips for Eating Your Veggies

Travel is not the only source of frequent flier miles.  With proper planning, you can often score miles through online shopping, credit cards, and evening dining out.  But another source of miles – grocery shopping – is soon to dry up.  Safeway recently announced that, as of February 28, 2010, it will no longer award airline miles to its customers.  Until then, customers can earn 125 miles for every $250 in purchases at Safeway and other stores within its group.

Although a rate of 1 mile per $2 spent is not great, Safeway’s partnership offered a good deal for regular patrons – and could be combined with airline credit card offers for even more miles.  But this turn-around does not mean customers are necessarily losing out.  There are still other ways to score deals at Safeway.  First, Safeway has had to cut out this program presumably because it is now offering more frequent sales and deeper discounts in face of the economy.  Second, you can still take advantage of online coupons that can be uploaded into your Safeway card for more discounts.  Third, you can enroll your Safeway card with UPromise to earn cash back in your UPromise account for purchasing specific items from various brands including Nestle, Hefty, and Florida’s Natural.  Customers are only allowed to enroll their Safeway card in either the miles program or in the UPromise program, but, with the miles program about to be canceled, that decision has already been made for you.  The cash back rate for groceries on UPromise is generally low, but it is better than no miles or cash back at all, and can be much higher when combined with the eCoupons you can upload from the UPromise site.

If you are close to reaching the $250 threshold for 125 miles, make sure you do that before the end of this month.  But if you are not, you may as well switch your Safeway card to UPromise and start earning that cash back as soon as possible.  To learn more about UPromise, check out our previous post on the program here.

Shop Around for Miles and Cash Back Too

With so many online portals offering miles or cash back if you shop through their website, it pays to look around for the best rewards out there.  So after you’ve done your research for the item you are going to buy and have found the perfect coupon code, you should look for bonus deals on online portals before hitting the purchase button.  You may need some patience to look through them but you will be duly rewarded for that, as the bonuses differ a lot from website to website and from store to store.  Here are four examples:

The Apple Store:

  • Discover’s ShopDiscover: 5% cash back
  • Bank of America’s Add It Up: 2% cash back
  • Upromise: 1% cash back
  • United’s Mileage Plus Mall: 3 miles per $2
  • American Airlines’ AAdvantage eShopping: 1 mile per $1
  • Delta’s SkyMiles Shopping: 1 mile per $1
  • Amtrak’s Points for Shopping: 2 points per $1

Expedia.com:

  • Upromise: 1% cash back
  • Bank of America’s Add It Up: 1% cash back

Macy’s:

  • Upromise: 6% cash back through August 7, usually 3%
  • Discover’s ShopDiscover: 5% cash back
  • Bank of America’s Add It Up: 4% cash back
  • American Airlines’ AAdvantage eShopping: 4 miles per $1 through September 6, usually 3 miles per $1
  • United’s Mileage Plus Mall: 7 miles per $2
  • Delta’s SkyMiles Shopping: 2 miles per $1
  • Amtrak’s Points for Shopping: 3 points per $1

Snapfish:

  • Bank of America’s Add It Up: 15% cash back
  • Discover’s ShopDiscover: 15% cash back
  • Upromise: 9% cash back
  • American Airlines’ AAdvantage eShopping: 6 mile per $1
  • Delta’s SkyMiles Shopping: 6 miles per $1
  • United’s Mileage Plus Mall: 9 miles per $2
  • Amtrak’s Points for Shopping: 5 points per $1

As you can see from the list above, bonuses vary significantly, and some stores even have limited time deals.  So if you have the time, don’t just stick to one portal.  In deciding through which one to shop , consider the size of the bonus as well as in which program you already have some miles or are close to reaching some sort of cash back threshold for redemption.  Either way, you will be turning your good deal purchase into an even better deal.

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The Art of Double and Triple Dipping

Most stores do not allow the use of multiple coupons for the same item (an exception is Harris Teeter – I have never shopped there, but apparently the grocery chain allows up to 20 double coupons, and, on some days, triple coupons), but there are other ways to get more than just the coupon discount.  If you have a credit card that gives you cash back, for example, you can easily double dip by using a coupon and getting some cash back by charging on your card.  Or even better, you can redeem your accumulated cash back for a gift card (a better rate for cash) and use a coupon when paying with that gift card – gift cards are not coupons and are thus perfectly compatible with them.

Triple dipping might require a little more effort, but is certainly worth the benefits.  Here are two examples of how I’ve gotten three times the bang for my buck:

Coupon + Cash Back + Miles: I subscribe to J.Crew emails, and a while back I got a coupon code for 20% off one item (Incidentally, there’s a sale going on at jcrew.com right now, and the coupon code EXTRA20 will give you an extra 20% off sale items until this Saturday, July 10th), which I chose to use on an item that I had been meaning to buy.  I made sure to use my Discover card on that purchase, since it was giving me a 5% cash back bonus for purchases at clothing stores during that quarter.  Finally, I also checked my frequent flier options.  Instead of visiting  jcrew.com directly, I accessed it and placed my order through the AAdvantage eShopping program, which gave me 3 American Airlines miles per dollar I spent on that purchase (minus taxes)!

The triple dipping results: An item on sale for $100, bought for $80, giving me another $4 in cash back and 240 miles.

Store Card + Miles + Upromise cash: Two weeks ago I bought a $260 netbook for my mother at Best Buy.  I already had the Best Buy Reward Zone card, which gives $5 in store credit for every $250 spent (a 2% rate), but I made my purchase through Upromise rather than by going directly to bestbuy.com, earning another 2% plus a $10 incentive (Upromise sends emails with extra offers if you don’t use it for a while).  And of course, I used my Citi/American Airlines card so I would get miles as well (a better deal than Discover when outside the bonus period).

The triple dipping results: A $260 purchase, for which I got $5 in store credit at Best Buy and $15 on Upromise as well as 260 miles.

Admittedly, the extras I got for triple dipping were relatively small compared to the price of the purchases, but they made it a much better deal than spending $100 at J.Crew or $260 at Best Buy and not getting any breaks for that.  And all I needed was a little creativity to consider my options among the available offers.

Have you had a great double/ triple (/quadruple?) dipping experience? Please share it in the comments section!

Upromise: One Bad News and Two Redeeming Factors

Last week, I wrote about Upromise, a program that gives members cash back for purchases at certain stores, websites, and restaurants, which can then be transferred to Sallie Mae student loan accounts or 529 Plans.  But here’s an update, straight from my inbox: As of July 1, 2009 (never mind that I only got the email 5 days later!), store purchases at Bed Bath & Beyond are no longer eligible for the program, though the cash back rate for purchases on bedbathandbeyond.com was raised from 1 to 2%.  This is a pity since the 1% cash back given at BB&B stores only sweetened the deal when combined with the store coupons that come in the mail every couple of weeks (20% off an item plus another 1% cash back), but certainly does not negate the other benefits of the program.

For starters, here are two other great things about Upromise besides those mentioned in the previous post: (1) Upromise often lists coupon codes for its member stores, which can be used even if you’re not shopping through its program (e.g., you can buy online through ShopDiscover but use a coupon code you found in the Upromise website); and (2) apparently the cash accumulated through Upromise does not have to be used exclusively for education expenses, despite the program’s professed purpose.  In the small and difficult to find FAQ section, the program notes:

Upromise was created to help families save for college and we strongly encourage members to use the money they’ve earned towards education expenses. However, members may choose to withdraw the money they’ve saved for other purposes if they wish.

Now, besides the fact that you won’t be getting 1% cash back at Bed Bath & Beyond stores anymore, what else is keeping you from signing up for Upromise?

Paying for Education, One Purchase at a Time

If you have student loans to repay to Sallie Mae or are trying to save for education through a 529 Plan, you may want to use Upromise to help you out.  Upromise is a service that gives you cash for certain purchases from grocery stores, restaurants, online retail sites etc., which can then be transferred to your student loan account or 529 Plan – essentially a cash back program under which the cash is redeemed for education expenses.

To be honest, the cash back rates for Upromise are generally lower than most other programs such as ShopDiscover.  However, Upromise covers a much larger number of merchants and combines different programs to generate even more potential rewards.  Discover’s 5% cash back at Target.com and the Apple Store, for example, beats Upromise’s 2% and 1% rates at these online sites, respectively.  Upromise, however, offers 2% cash back on eBay and 1% on several travel sites, such as Orbitz and Travelocity, while Discover has not partnered with those sites as of yet.  Furthermore, Upromise also gives up to 8% cash back on restaurants that belong to the Rewards Network (for a full list visit rewardsnetwork.com) and on in-store purchases at a few places such as Bed Bath & Beyond (1%) and the Sunglass Hut (6%).

Upromise also allows you to add your grocery cards to your account, so that you get cash back on Upromise for certain items on top of your grocery stores’ discounts and/or points.  Participating stores include Safeway, Harris Teeter, and CVS.

Now the best feature of Upromise I think is that it allows you to add friends and family to your network.  That is, if they create a Upromise account and add you as a beneficiary, they can use the cash back program to help you pay for your education.  Alternatively, for online shopping, you can simply send them a “guest shopping” link, so that they do not even have to sign up for Upromisem but you can still earn cash on the program whenever anyone shops through that link.  So if your mom usually does the groceries and uses store cards, you may want to have her sign up for Upromise and help you pay off your loans; and if your grandparents are coming to visit, you might to want to send them your Upromise “guest shopping” link so that their trip can help you get some money into your 529 Plan.