There are tons of rewards credit cards that help you save money on things like travel and groceries. But you may not realize that certain credit cards are also great for major purchases, such as new furniture.
“Opening a new credit card before buying a couch can be a great way to earn extra rewards to help pay for the purchase or use toward another financial goal, like saving up for a vacation or other big-ticket purchase,” said U.S. News contributor Andrea Woroch, a nationally recognized money-saving blogger and expert. That’s especially true if the card you have now doesn’t offer you robust rewards for purchases or if the type of reward you’re currently earning — such as airline miles or hotel points — is no longer a priority, she added.
So if you’re planning to buy furniture soon, consider opening a new credit card with specialized savings first.
What to Look for in a Furniture Credit Card
Sign-Up Bonus
Many cards award a sign-up bonus
when a minimum amount is spent within a short time frame after opening a new card. “This means that large purchases like furniture are usually an excellent time to open a new card,” says Nick Burgess, owner of personal finance blog Making a Millennial Millionaire. In fact, some cards offer sign-up bonuses worth upward of $300.
[Read: Best Sign-up Bonus Credit Cards.]
No Interest on New Purchases
Some credit card companies will offer low- or even no-interest promotions to attract new customers. Getting a card with an introductory 0% annual percentage rate can buy you more time to pay off a big furniture purchase without racking up additional fees, according to Woroch.
“Just make sure you review the terms and that you can pay off the balance in full before that introductory offer expires,” she says. “Otherwise, you will have to pay interest on the remaining balance or potentially for the full amount you initially charged, depending on the terms and conditions.”
Customized Cash Back
As you prepare for your next home update, look for a flexible rewards credit card that allows you to maximize your cash back earnings, says Jason Gaughan, head of consumer card products for Bank of America. Some cards allow you to earn higher cash back in a spending category of your choice each month or quarter, including home improvements and furnishings.
[Read: Best 0% APR Credit Cards.]
Flat-Rate Cash Back
Woroch said the common cash back rate is around 1%. However, if you plan to keep your new card for ongoing spending, look for one that offers a competitive flat cash back rate on all purchases, such as 2% or higher. This ensures that you get a sizable amount of cash back — whether you’re purchasing furniture, groceries, gas or anything else — without the hassle of choosing any categories.
Purchase Protection
is another valuable credit card perk. If a qualifying item is stolen or damaged within a certain time frame, purchase protection will cover its repair or replacement. “Of all the cards I’ve seen, American Express typically has the most aggressive purchase protection, with some of their cards covering up to $10,000 per incident if something purchased on the card gets lost or broken in the first 90 days of purchase,” Burgess says.
Loyalty Program
Finally, bank loyalty programs can add another layer of financial rewards on major purchases, Gaughan says. For example, the Bank of America Preferred Rewards Program provides members with a credit card rewards bonus of 25% to 75%. “This translates to up to 5.25% cash back in your choice category, so you can boost your cash back earnings even higher as you buy your next piece of furniture,” he adds.
[Read: Best Cash Back Credit Cards.]
Best Credit Cards for Buying Furniture
Once you have a list of the qualities that are most important to you in a credit card for furniture purchases, you can start evaluating cards. We rounded up a few of the top choices on the market today.
Blue Cash Everyday Card from American Express
Introductory APR: 0% intro APR on purchases and balance transfers for 15 months from the date of account opening. Annual fee: $0. Rewards:
— 3% cash back at U.S. online retailers, U.S. supermarkets and U.S. gas stations (up to $6,000 in purchases annually in each category, then 1% cash back).
— 1% cash back on other purchases.
Welcome offer: You can earn a $200 statement credit after you spend $2,000 within the first six months.
If you’re buying furniture from an online retailer, consider the Blue Cash Everyday card. Not only can you earn 3% cash back, but you can also earn a $200 statement credit after spending $2,000 within the first six months. A lengthy 0% APR introductory period gives you time to pay off your purchase interest-free.
Capital One Venture Rewards Credit Card
Introductory APR:
None. Annual fee: $95. Rewards:
— 5 miles per dollar spent on hotels and rental cars booked through Capital One Travel.
— 2 miles per dollar spent on all purchases.
Sign-up bonus: Earn 75,000 bonus miles once you spend $4,000 within the first three months.
The Venture Rewards card is handy if you travel frequently. For one, you earn a whopping 5 miles for every dollar spent on hotels and rental cars booked through Capital One. Plus, a generous sign-up bonus equal to $750 in travel can help offset a large furniture purchase.
Introductory APR:
0% APR for 15 months from account opening on purchases and balance transfers. Annual fee: $0. Rewards:
— 5% back on up to $1,500 in combined purchases in bonus categories, including select online merchants.
— 5% back on travel bookings through the Chase Ultimate Rewards portal.
— 3% back on dining and drugstore purchases.
— 1% back on all other purchases.
Sign-up bonus: Earn $200 after you spend $500 on purchases in the first three months.
When you use this card to buy through an eligible online retailer, you can earn 5% back, though you must activate the category first. Right now, you can also earn a $200 introductory bonus after meeting the spending requirement. An introductory 0% APR also allows you more than a year to pay off your furniture purchase with zero interest.
Amazon Prime Rewards Visa Signature Card
Introductory APR:
None. Annual fee: None, though cardholder must be a Prime member ($139 per year) to access card benefits. Rewards:
— 5% back at Amazon and Whole Foods Market.
— 5% back on Chase Travel purchases.
— 2% back at restaurants, gas stations and on commuting.
— 1% cash back on all other purchases.
Sign-up bonus: Receive a $100 Amazon gift card instantly on approval.
Amazon Prime members know you can buy just about anything on Amazon and often receive it in two days or less. That’s why the Amazon Prime card makes a great option for purchasing furniture; you receive 5% back on all purchases on Amazon.com. Plus, new cardholders can get an extra $100 to put toward a furniture purchase (or anything else from Amazon) once approved.
Introductory APR:
0% APR for 15 months from account opening on purchases and balance transfers. Annual fee: None. Rewards:
— 5% cash back on your top eligible spending category, on up to $500 spent each billing cycle.
— 1% cash back on all other purchases.
Welcome offer: Earn $200 after you spend $1,500 in the first six months of account opening.
With the Citi Custom Cash Card, you don’t need to sign up for rotating bonus categories. Instead, you earn 5% cash back in the category where you spend the most each billing cycle, on up to $500. So if you’re planning to make a large furniture purchase, using this card could help you get 5% back. Plus, you can earn an extra $200 back by meeting the spending requirement and enjoy a 15-month introductory 0% APR.
Synchrony Home Credit Card
Introductory APR:
12 to 60 months promotional financing on qualifying purchases at Synchrony Home locations; six months promotional financing for all purchases of $299 to $1,998.99; 12 months for purchases of $1,999 or more. Annual fee: None. Rewards: None. Sign-up bonus: None.
This card is designed for home goods purchases and is accepted at thousands of locations nationwide and home-related stores online, including several major retailers and scores of local stores. You can use the card again and again at all accepting Synchrony Home locations on a revolving basis, so you can furnish your home over time. Plus, it provides access to long-term promotional financing at all accepting Synchrony locations, but be sure to pay attention to the fine print. If the balance is not paid in full by the end of the promotional period, interest will be charged on the full purchase price.
U.S. Bank Cash+ Visa Signature Card
Introductory APR:
0% APR on purchases and balance transfers for the first 15 months. Annual fee: None. Rewards:
— 5% back on your first $2,000 in combined eligible purchases each quarter on two categories you choose.
— 2% back on one everyday category.
— 1% back on all other purchases.
Sign-up bonus: Earn $200 cash back after you spend $1,000 in eligible purchases within the first 120 days of account opening.
With the Cash+ card, you can select two categories each quarter that earn 5% back, including furniture stores and department stores. Also, you have the opportunity to earn an additional $200 bonus when you meet the spending requirement. With a lengthy 0% APR period, you could pay off your furniture purchase without paying any interest.
U.S. Bank Shopper Cash Rewards Visa Signature Card
Introductory APR:
None. Annual fee: $0 for the first year, then $95. Rewards:
— 6% cash back on your first $1,500 in combined eligible purchases each quarter with two retailers you choose.
— 3% cash back on your first $1,500 in eligible purchases on your choice of one everyday category.
— 1.5% back on all other purchases.
Sign-up bonus: Earn $250 cash back after you spend $2,000 within the first 120 days of account opening.
If you have a specific retailer in mind for your furniture purchase, this card could help you earn a whopping 6% back. Qualifying retailers include Crate & Barrel, Ikea and Wayfair. A sign-up bonus of $250 also allows you to offset the cost of a major furniture purchase. The annual fee is waived in the first year to help you save even more.
More from U.S. News
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Credit Cards vs. Debit Cards: What Should I Use?
How to Use a Credit Card the Right Way
What’s the Best Credit Card for Buying Furniture? originally appeared on usnews.com
Update 08/09/23:
