Works 4 Me Wednesday: Christmas Cash

It snuck up on me again this year. Christmas! It's October and I am already in high gear trying to put together my full Christmas list and all the trimmings. But honestly, I already have put aside about 50% of my Christmas shopping.

Each January I begin my Christmas shopping with an empty giant rubbermaid container in my basement (in a closet). As I find great deals on items or see unique, one of a kind items I know I won't find again (think vacations and little hole in the wall shops you might stumble upon) I place them in this basket with a note for who the recipient might be. This goes on and on throughout the year. Sometime around October I begin to really get serious. I make a full Christmas list with all the people I will need to buy items for.  I take items out of the rubbermaid container and write little notes about what I already have beside the people's names who I already have gifts for. If I totally complete someone's gift I check off their name. (I watch for items I can use Kohl's cash on, gift certificates, coupons, etc throughout the year.)

Once I've gone through my rubbermaid box I can scrutinize the list and see who is left to buy for and what items might be needed to supplement. (I LOVE to put together themed gifts!) Then it's time to head over to my Discover card account online. Throughout the year mty husband and I make about 90% of our purchases using our Discover card. We pay it off EACH AND EVERY month! (We've NEVER carried a credit card balance.) In October we can then cash in our Discover rewards for gift cards to retailers. I like redeeming them for gift cards first because you can usually redeem $40 and get a $50 gift card. Who doesn't like a little something for nothing???

If we still have people left on our list that a gift card just won't do... we then redeem any other reward points for a Discover Money Card (or you can request a check). We use this to purchase any remaining gifts we need to get.

Just as an example... This year we had $350 in Discover points to redeem. (1% back on some purchases, and between 2-5% back on other purchases!) We were able to knock off almost every last item on our list with this amount.

I have a few more items left to get (small things...) but I have made a HUGE dent in our Christmas list and it's only October. This leaves a lot of time in Decemeber for Christmas festivities, caroling, cookie baking, and all that fun without the stress of Christmas shopping at the last minute to find that "perfect" gift.

I certainly don't think using credit card rewards is the best practice for everyone. But if you can pay off the bill every month and still stick to your budget it is a great way to earn some free Christmas presents! It's what works for me.