If you're going to need to spend, might as well get some rebates, rewards, discounts when you spend on daily necessities.
Simply put, pay off your credit card bills every month, call your credit card bank provider to waive off the annual fee (in Singapore, credit cards are free. There is little concept of credit score and as long as you have an income of SGD2k/mth, you should be able to qualify for useful basic credit card.)
In this post I will explore the credit cards which I regularly use and how I optimize the returns on the cards.
Primary Card : UOB One card
Benefits
3.33% return on spending.
Tier 1, Spend SGD300 per mth for 3 mths in a row and on the third mth, SGD30 will be off set from your credit card bill.
Tier 2, Spend SGD800 per mth for 3 mths in a row and on the third mth, SGD80 will be off set from your credit card bill.
Tier 3, Spend SGD1500 per mth for 3 mths in a row and on the third mth, SGD150 will be off set from your credit card bill.
2% more rebate if you use this for overseas spending. This 2% is on top of the 3.33% mentioned above. Also, the overseas spending counts to the accumulation of the monthly spending.
Cons
Miss 1 month of spending and your reward will drop to the lower tier.
Require constant monitoring to keep the balance at a certain level.
Induced spending to keep the balance at a certain level.
This card is my primary card, I have a supplementary card for my wife to consolidate our spending. Our handphone bills are charged to this card. My insurance policy cannot be paid by credit card so monthly premiums cannot be charged on this card. Other insurances allow credit card payments. I monitor the card regularly online to make sure we hit the SGD1500/mth. All spending is put on this bill except for instances where credit card is not accepted or if there is a direct immediate discount more than 3.33% for a particular card. (ie, 10% discount off dinner bill is using Standard Charted Card). After spending breaches SGD1500 for the month, I will switch over to my secondary card. A problem I encounter is if spending for the month is under SGD1500. Recently my monthly expenditure was only SGD1200 and I had to induce spending to buy SGD300 more of vouchers to cover up the difference. The consolation was that the vouchers can be used at another time as gifts or self use. This card is not useful if you cannot maintain a constant spending or are unwilling to monitor the balance constantly.
Secondary Card : Citibank Dividend card
Benefits
Able to accumulate "dividend" which will be offset on the next bill once the total dividend has reached SGD50. Accumulated "dividend" will expire every 12 mths.
Petrol Discounts:
Shell Escape card will provide 5% discount off petrol combine with CitiDiv Card.
Shell petrol discount 5% resulting in remaining 90% bill.
5% Dividend Accumulation on the 90% (5% * 90% = 4.5%) petrol bill and
4% rebate of the remaining 90% in Citi$ which can be used as cash at participating outlets like Shell/Giant hypermart on your next purchase. (4% * 90% = 3.6%) *
Total "savings" on petrol 18.1% (Minimum spend of SGD50 on petrol)
2% dividend accumulation on food and beverage if the bill is above SGD50.
10% Citi$ accumulation at Starbucks*
Other spending only 0.5% dividend accumulation
There are other benefits but I don't really use them as my main usage for this card is for petrol and excess food spending above the Primary card.
Cons
Terrible rebate rate of only 0.5%.
Well a car is a terrible expense and you shouldn't get one if you want to save more money, but if you're going to pump petrol might as well get as much discounts/rebates back as possible. We (my wife and I) don't really like to use this card but if our expenditure goes past SGD1500, on our primary card, there will be no additional benefit to spending on the One card. So, we will charge to this card to consolidate the bill with the petrol spending. We don't usually exceed SGD1500 by much and it's usually on food so we get the 2% dividend.
These 2 cards cover 95% of our typical expenses/transactions.
*Citi$ is a rebate stored on the card and can be used to offset purchases at participating outlets as cash. Usually places where you can accumulate Citi$ you can spend Citi$. Do not use your Citi$ at Starbucks as it is best to accumulate Citi$ at Starbucks. (What are you doing at Starbucks if you want to retire early!) Recommended to spend Citi$ at Giant which is a supermart where Citi$ accumulation is only 0.5%. If you frequently shop at Giant, you will need the ANZ credit card which gives you 5% rebates. I don't know much about it as I don't buy much groceries from Giant. So I just use my basic 2 cards.
Tertiary Card : Standard Chartered Manhattan/Manhattan World card
Benefits
0.5% rebate on spending under SGD999
1% rebate on spending between SGD1000 - SGD2999
3% rebate on spending more than SGD3000 (to a max of SGD200 rebate per 3 mths)
(Used to be 5% rebate on spending more than SGD3000 to a max of SGD200 worth of rebates per 3 mths.)
Rebates will accumulate every month and will offset the bill on the third mth.
Some restaurants have direct discounts for Standard Chartered cards so it makes sense to hold one of the cards for immediate discounts when possible.
Cons
No real use of this card as One card provides 3.33% rebates. Unless there is an exceptional spending like a wedding to prepare for or renovation of the house which would push normal spending to above SGD1500. Used to make more sense when rebates was 5% but this was changed to 3% recently.
Used for big ticket items which are above the usual spending. I charged on this card when I had to arrange my wedding it was at 5% rebate then. Otherwise no real use for this card as spending should be covered by primary and secondary card. Useful for some food discounts.
Oh this card is particularly useful for people who do want to use the One card. As most people have expenses of more than SGD1000/mth but many also do not like to monitor the spending closely like I do. So they can get 1% rebate of basic spending which is better than CitiDiv card.
Specialized Card : OCBC Robinsons Card
Benefits
5% rebate on spending in Robinsons/Marks & Spencer offsets against the current month bill.
Special member's discount during certain events in Robinsons/M&S.
Cons
No other real use for this card.
I use this only when spending in Robinsons/M&S.
Problem with using specialized cards is that it gives you a better discount as compared to the primary card but makes it harder to hit the SGD1500 which I target on my primary card.
Specialized Card : POSB Everyday Card
Benefits
Rebates at Watson. Works the same as Citi$. Watson will have days when rebates might be 3%, 6%, 10%.
Wait for the 6% or 10% days and spend on this card. Rebates will be stored on the card and value can be used to offset next spending at Watsons or participating outlets.
Doubles up as an ATM card
Also can be used as a EZLink Card. (That is Singapore's card for transportation on public transport.)
Cons
No other real use for this card.
I use this only when spending at Watsons.
Problem with using specialized cards is that it gives you a better discount as compared to the primary card but makes it harder to hit the SGD1500 which I target on my primary card.
Specialized Card : OCBC Frank Card
Benefits
6% rebates on online spending ONLY FOR PARTICIPATING MERCHANTS.
Can be used to book trips for Tiger Air and other online merchants but must be careful on the merchant.
Rebate will offset NEXT bill.
Cons
No other real use for this card.
I use this only when booking Tiger Airways plane tickets.
Problem with using specialized cards is that it gives you a better discount as compared to the primary card but makes it harder to hit the SGD1500 which I target on my primary card.
Other Uses of Credit Cards
-Free Cash
-Some cards have free gifts when signing up.
-HSBC had a credit card giving out SGD80 in your account just for signing up. So sign up, spend SGD80 and set a phone alarm to remind you to cancel in about 6 mths.
-Standard Chartered Cards also has cash incentives for signing up for many of their cards.
-Don't buy luggage/travel bags. Many cards gift luggage bags upon sign up. Citibank has a credit card team hanging at Orchard MRT station promoting their credit card and free luggage bag.
-Same for coffee machines, Nespresso/Dolce Gusto Machines can also be some of the sign up incentives. I got a old model Dolce Gusto coffee machine from CIMB Credit Card.
Notes
Reward cards typically give a poorer return than cash rebate cards.
We have done research on if we spend the same amount on other reward cards and the result is the rewards is lower than if you use cash/dividend rebate cards.
Unless you are a very heavy spender.
Example: Some cards give 10x reward points for retail spending which can be used to exchange for other retail vouchers. But if you spend so much on retail, what are you doing at this blog?
OK. The above are the usual cards which I use/carry around.
I also sign up many cards just for the promotions/incentives. I don't use those cards after that and cancel them in due course. Pls remember, like fire, it is a good servant but poor master. Control your credit card and use it to your advantage. Pay off your bills at the end of the month and never let the balance roll. 2% interest rate per month is an insane amount.
Do you have any other useful credit cards which I have failed to mention?
For daily use or for specialized usage?
Share with us in the comments below and I will update with the useful tips provided.
Updated credit card post here
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