Smart Reasons to Save, Use and Invest Money

Is Plastic Card Budget Worth It?

What is a “Plastic Card Budget”?

Plastic Card Budgeting is a simple (but special) budgeting technique that can help you spend less money, and at the same time enabling you to realize a discount on your purchases.  So quite literally, it’s a win-win!

How Does a “Plastic Card Budget” Work?

At a time frame specific to your buying patterns (usually monthly), buy all of the expected gift cards or refill a special prepaid card at the beginning of each month.  The prepaid card will server the purpose of a catch-all for those purchase that are gift card specific. The prepaid card is usually a debit card that can be refilled with occasionally to cover non-topic purchases.  You will also need to carry at least $100 in cash for emergencies where you can’t used plastic, but you’d be surprised at how far $200 goes since you can use plastic for practically everything.  In fact, I only use cash for two purposes… 1.) Kid Allowances and 2.) this one small restaurant that doesn’t take credit cards that I wouldn’t go to except the kids love the place.

So when I go out to eat with the family, I usually use a Darden’s Gift card (which can be used at Olive Garden, Red Lobster, Longhorn Steakhouse, The Capital Grill, Bahama Breeze, Seasons 52).  Between my prepaid card and my Darden’s gift card, 80% of my disposable income needs would be met.

So How Do I Save Money This way?

Mainly with buying the gift cards at a discount via using my rewards credit card (my Favorite being the Amex Blue Card), I’m able to give myself a decent discount on my future discretionary spending!  Depending on where you buy your gift cards at, and the rewards card that you use, you can save 1%, 2%, 3% or maybe even 5% on your gift card purchases.

This article was provided by AXA Business Insurance.



4 Responses to Is Plastic Card Budget Worth It?

  1. I guess this could be a great way to save not something I would use. For people who have trouble budgeting putting money on a prepaid card is surely a great way to curve extra spending. The key is making sure they only reload the card once per month. Have you used this method before? How did it work out for you?

  2. Sounds great! I think plastic card budget can really help to save money. It’s quite interesting way, I haven’t heard about that before 🙂 Thanks for sharing this way. It good that caredit cards can help us to save some cash. But most of consumers misuse then and do not get any benefits. I think that it’s not right to put all the expenses on plastic. I am sure, if to use a credit card prudently, it’s not a bad thing and can help sometimes.