Credit Cards Tips and Tricks (2021 Edition)

This is article first appeared in The Kiam Siap Life. You can view the original article HERE.

2021, going back to basics.

Essentially, this passion and motivation to get the best deals out of credit cards was one of the main reasons why we started this blog. Now, assuming you already know how credit cards work and have owned at least ONE (if not you can always scroll through our credit cards articles HERE), let us run you through some tips and tricks to up your credit card game. Because really, who uses just 1 credit card for everything?

While credit cards in Singapore generally brings us to either of the 2 camps – Cashback OR Miles (Which I’ll not be discussing and delving in too deep in this article as we’ve covered previously HERE, albeit a lil outdated), properly managing and utilising them goes a longggg way.

1. “Divide & Conquer” vs “All in One”

I think by now, most readers would know that I’m someone who holds multiple cards because, aside from getting the most benefits out of each, I also get to collect some pretty sleek designed ones. 😛

But that aside, I think there are two extreme categories that some people fall into, and neither of them work out too well.

- Holding only 1 credit card & use it to pay for everything else.

- Holding way too many credit cards

Before I run through some flaws and shortcomings for each decision, let me give you some basic 101 knowledge on something known as Merchant Category Code.

Credit cards has a network of four digit numbers known as Merchant Category Code (MCC). Credit cards uses the MCC to track and categorise your purchases accordingly. Different businesses have different MCCs assigned to them. So for example, when you use your card at a retail store, a MCC will then be assigned to it (e.g. MCC 5311) and when you use your card to pay for your insurance bills, it will be tagged to another MCC (e.g. MC 6300).

Holding only 1 credit card

Now that you’ve got some understanding of MCC covered, let us tell you how using 1 credit card for all your purchases isn’t all that savvy at all.

Let’s assume you only have DBS Live Fresh Card because you vaguely understand that you get 5% cashback. Seems like a whole lot right? What you need to know is that this 5% is split up into different spending categories (e.g. online retail spend, paywave purchases), capped at $45 cashback a month and requires a minimum spend of $600.

What happens if, on a particular month, you suay suay (unlucky) only spent $590? Or perhaps, the facial shop you visited, costing $450 treatment, doesn’t accept paywave payment? Or maybe, used this card to pay for your utility bills (MCC code doesn’t fall into this card’s category). That’s right, 0% cashback, $0 received.

Holding multiple cards allow you to receive multiple benefits (be it cashback or miles) from different payment types (online, paywave, swipe) and often times, allow you to have the flexibility of optimising different MCCs in case some credit cards doesn’t fall in a particular category.

That being said, however, the flip-side of it, holding too many credit cards has its downsides too.

Holding too many credit cards

The question is, “How many is too many?”. I think my answer to this can come down to a few pointers.

– Do you struggle to remember to make payments for your credit card bills?

– Do you often miss your monthly bill payments? (Missing 1 month is already a no-go for me)

– Do you end up paying for your credit card’s annual fee because you didn’t even notice it was being charged?

– Do you find yourself using too many of your cards such that the rewards you receive become saturated?

If it’s a YES for quite a few of these questions, then perhaps it might be a good time to reconsider cutting down to use a core number of cards or cancelling unused ones (which can be a good option, more on that later).

Being a holder of many cards myself, I certainly don’t use all of them, but several main cards (3-4 of them) to maximise my rewards for both miles and cashbacks. You can see my strategy HERE.

2. Double Dipping in 2021

While double dipping of rewards has seen its glory days in the past 2-3 years, there unfortunately aren’t many options left after the closure of some companies and Grabpay top-ups updating its MCC, effectively excluding credit cards rewards.

While I’m sure there are many specific brands or purchases that allow you to receive freebies and rewards every now and then, these are the two strategies I’ve deployed on a day to day basis that have been constant in its double dipping rewards!

• Samsung Rewards: While still retaining its exclusivity to Samsung users (sorry, not sorry), to which I have written a full post about it HERE, I’ve been effectively able to double dip while linking my credit card to the app and redeem free drinks/food at least once per month.

• Grab Rewards: Not to be confused with Grab-Pay top ups. Essentially, linking a suitable credit card to your Grab app (HSBC Revolution for me) allows you to earn both credit card rewards (4 mpd on HSBC Revolution) as well as Grab points.

3. Never Pay for Your Annual Fees

Unless, of course, you think $192 per year is no big deal.

Here, I’m referring to entry level credit cards, usually with a minimum annual income of $30,000 and annual fees of around $192. More prestigious credit cards usually have higher annual fees to maintain and sometimes may even be worth paying the annual fees, but that’s an article for another time.

But here’s the bottomline. Never pay for your annual fees.

Banks usually waive off your credit card annual fees if you’ve been using them. But if they do not, for whatever apparent reason – call up the banks to request a cancellation, cancel it via ibanking, cancel it via IVR/SMS. Do whatever it takes such that whatever rewards you’ve earned for the past year doesn’t get negated back to $0.

And of course, if your credit card’s participating bank doesn’t allow you to waive it, simply cancel the card! 🙂 Which conveniently brings us to our next point.

4. Re-Apply Credit Cards After One Year

So the bank decided not to waive off your annual fee? No biggie.

Cancelling your cards that you rarely use may serve a bigger purpose. From better managing your vast array of unused cards to reaping more new sign up rewards! Because if you didn’t already know, you automatically become a new-to-bank cardholder after a period of 1 year.

This goes hand in hand with our last point below.

5. Apply Credit Cards From Financial Comparision Sites

I’ll be honest and admit that I probably have one too many credit cards myself. Many of which are unused.

But all my applications are not in vain, because with each applications that I apply from financial comparison sites (i.e. SingSaver), they have gotten me useful rewards that ranges from Cash to highly prized gifts such as Apple Airpods or TVs.

While the catch here is that these rewards may seem to be one-off in nature (for each participating bank) because of how it is only meant for new-to-bank cardholders, it really isn’t, that is if you wait it out.

Going back to point 4, cancelling your unused cards and waiting out for 1 entire year brings you back to a “new-to-bank” status. Effectively giving you another shot at applying for the credit card again when a sizeable SingSaver promotion comes along!

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