It's not every day that you'll hear us tell you to use your credit card to buy a new laptop instead of using cash, but so long as you can pay it off right away there are many reasons to pay for your next laptop, or other holiday gadget, with a credit card.
In our example, we'll use a new MacBook Air 13" laptop to illustrate the savings achieved from purchasing it with a credit card versus paying in cash or using a debit card. For our purchase we used a Citi Credit card because of the extras it provided. If you are looking for a credit card, check out our list of the best credit card offers for holiday shopping sprees.
Double the warranty: Our Citi card offered a great deal when it comes to the warranty of our computer, doubling the life of the manufacturer's warranty. In this case the standard 1-year MacBook Air warranty from Apple was extended to two years -- long enough that we felt comfortable avoiding the $249, 3-year Applecare warranty. This warranty extension doesn't cover accidental damage like drops or spills -- like the warranty offered by SquareTrade does ($159 for three years) -- but again we felt confident enough in the free two-year protection that we saved between $159 and $249 on our purchase.
While this warranty extension works on most gadgets, and is still valid if you buy a gift on your credit card, you should call your credit card company to verify that the item you are purchasing is covered. We had to call and speak to a claims representative to verify that computers are included. Also note that you have to put the entire item on your credit card to be enrolled in warranty extension.
Purchase assurance: Also included free of charge is protection, up to $1,000, against theft or accidental damage for items purchase on our Citi card. The amount of purchase insurance coverage doesn't equal the cost of our MacBook Air, but it does offer us a little peace of mind for the first few months of use that we wouldn't have had if we paid in cash.
Credit card rewards: Right now Citi is running an incredible promotion for the holiday season which offers 5% cash back on consumer electronic purchases. While there are some restrictions, we verified that a purchase from the Apple store would qualify. Like many credit card rewards offered these days we had to log in and sign up for the reward, which took two days to activate.
After enabling our credit card rewards we were able to purchase a MacBook Air 13" from Apple, and after student discount, tax and shipping, will receive $72 in cash back rewards which we can apply directly to our account.
Total savings: When all is said and done we saved $231 to $321 on our computer purchase using a credit card, not including the value of purchase assurance. That doesn't even include the additional $60 we saved with Apple's education discount.
Keep in mind when you are shopping for a new computer or a holiday gadget that many companies offer student discounts that can increase the savings. Many of the student discount programs allow parents to make the purchase on behalf of the student.
These are just a few of the credit card perks you can leverage from your credit card company if you know what you're doing. Just make sure you've budgeted enough to pay off your purchase since one month of interest charges can completely wipe out your savings.
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