At Experian, one of our priorities is consumer credit and finance education. This post may contain links and references to one or more of our partners, but we provide an objective view to help you make the best decisions. For more information, see our Editorial Policy.
In this article:
We're all familiar with Black Friday and Cyber Monday, but have you heard of the newest retail holiday: Prime Day? Stocked with deals for Amazon Prime members, Prime Day—like other retail holidays—can be a great opportunity to find deep discounts and limited-time savings.
Whether you aim to get your holiday shopping started or make a large purchase for yourself, having the right credit card ready for Prime Day could help you maximize your savings. Cash back, valuable credit card rewards and even promotional 0% interest financing can take some of the bite out of those buys.
Normally, Prime Day is held in July, but plans were shifted due in part to the ongoing pandemic. The date for Prime Day 2020 has not yet been released, so be sure to keep an eye on Amazon's website for an announcement in the coming weeks. Until then, here are some credit cards you may consider getting before Prime Day arrives to lock in extra savings.
Which Card Offers the Most Cash Back?
If you plan to buy a lot on Prime Day, using a cash back card may be a great way to lower your overall spending. Imagine you spend $1,000 on Amazon purchases using a card that offers 2% cash back. That could give you $20 in cash back, bringing your net spending down to $980.
If you're looking for cash back on your purchases, the Citi® Double Cash Card - 18 month BT offer, from our partner, offers up to 2% cash back on all purchases (1% when you make the purchase and 1% when you pay it off). New applicants for this card are eligible for 18 months of introductory 0% annual percentage rate (APR) on balance transfers. Once the 18-month intro period ends, you'll pay a 13.99% to 23.99% variable APR on the leftover balance. You'll also pay 3% of the amount you transfer as a balance transfer fee or $5, whichever is greater.
Citi® Double Cash Card - 18 month BT offer
13.99% - 23.99% (Variable)
Earn 2% on every purchase with unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases.
- Earn 2% on every purchase with unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases.
- To earn cash back, pay at least the minimum due on time.
- Balance Transfer Offer: 0% intro APR on Balance Transfers for 18 months. After that, the variable APR will be 13.99% - 23.99%, based on your creditworthiness.
- Balance Transfers do not earn cash back.
- If you transfer a balance, interest will be charged on your purchases unless you pay your entire balance (including balance transfers) by the due date each month.
- There is a balance transfer fee of either $5 or 3% of the amount of each transfer, whichever is greater.
- The standard variable APR for Citi Flex Plan is 13.99% – 23.99% based on your creditworthiness. Citi Flex Plan offers are made available at Citi's discretion.
Can My Spending Help Me Unlock an Intro Bonus?
Another great way to benefit from your Prime Day spending is by using it to help you qualify for a credit card intro bonus that bumps up your rewards if you spend a certain amount with the card when you first receive it. These offers can be extremely valuable, but you should be careful not to spend more than you would otherwise in pursuit of them.
If you plan to do a substantial amount of shopping on Prime Day, these purchases could help you work toward your minimum spend requirement. The Chase Sapphire Preferred® Card, for example, offers a lucrative introductory bonus of 80,000 rewards points for spending $4,000 with the card within 3 months of signing up. Those 80,000 points are worth $1,000 when put toward travel expenses through the Chase Ultimate Rewards portal or $600 if redeemed as cash back.
Depending on how much you spend on Prime Day, using this card for your purchases could get you close to meeting that minimum spend requirement in order to unlock the initial bonus offer.
Chase Sapphire Preferred® Card
15.99% - 22.99% Variable
2X points on dining at restaurants including eligible delivery services, takeout and dining out and travel & 1 point per dollar spent on all other purchases worldwide
1X points on All Other Purchases
Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,000 when you redeem through Chase Ultimate Rewards®. Plus earn a $50 statement credit towards grocery store purchases within your first year of account opening.
- Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,000 when you redeem through Chase Ultimate Rewards®. Plus earn up to $50 in statement credits towards grocery store purchases within your first year of account opening.
- Earn 2X points on dining including eligible delivery services, takeout and dining out and travel. Plus, earn 1 point per dollar spent on all other purchases.
- Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards®. For example, 80,000 points are worth $1,000 toward travel.
- With Pay Yourself Back℠, your points are worth 25% more during the current offer when you redeem them for statement credits against existing purchases in select, rotating categories
- Get unlimited deliveries with a $0 delivery fee and reduced service fees on eligible orders over $12 for a minimum of one year with DashPass, DoorDash's subscription service. Activate by 12/31/21.
- Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more.
- Get up to $60 back on an eligible Peloton Digital or All-Access Membership through 12/31/2021, and get full access to their workout library through the Peloton app, including cardio, running, strength, yoga, and more. Take classes using a phone, tablet, or TV. No fitness equipment is required.
How to Pay 0% Intro APR on Purchases
If you're using a credit card and want to take your time paying off your purchases, using a card that offers 0% intro APR on new purchases could help you save in interest costs. With a 0% intro APR card, you won't be charged interest on the applicable balance for a set period of time. Depending on your card balance, this could provide hundreds to thousands of dollars in savings over time.
Let's say you spend $1,000 on Prime Day, leaving you with a $1,000 balance on your credit card. If your card provides a 15-month 0% APR intro period, you could completely pay down your debt in that timeframe by making monthly payments of about $67, and avoid interest charges you'd otherwise pay.
Paying the same amount every month on a credit card that charges 15% APR (close to the national average) would mean paying off the debt for 17 months and paying roughly $114 in interest.
There are many cards that offer 0% APR for a limited time, such as the Chase Freedom Unlimited®, which offers 0% intro APR on new purchases for 15 months in addition to various rewards opportunities. The Chase Freedom Unlimited® has an ongoing interest rate of 14.99% to 23.74% variable that kicks in once the intro period ends. With the Chase Freedom Unlimited®, you can also earn 1.5% cash back on all purchases, making this card even more valuable if you use it for your Prime Day spending.
Chase Freedom Unlimited®
14.99% - 23.74% Variable
Earn 5% cash back on travel purchased through Chase, 3% on dining and drugstores, and 1.5% on all other purchases.
3% cash back on Dining
1.5% cash back on All Other Purchases
Earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening.
- Earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening.
- Earn unlimited 1.5% cash back on all other purchases.
- Earn 5% on travel purchased through Chase, 3% on dining at restaurants and drugstores, and 1.5% on all other purchases.
- No annual fee.
- 0% Intro APR for 15 months from account opening on purchases, then a variable APR of 14.99 - 23.74%.
- No minimum to redeem for cash back. Cash Back rewards do not expire as long as your account is open.
What to Remember When Shopping on Prime Day
With any shopping holiday, it's easy to go overboard and spend more than you planned. To ensure you don't fall victim to clever marketing and the allure of fleeting discounts, create a plan before you start shopping.
Here are some tips and tricks for spending responsibly during a retail holiday:
- Stick to your budget. Before you start shopping, have an idea of what you can afford to spend. Set a limit and stick to it. If you're making purchases for the holidays, make sure to include this spending in your overall holiday budget. Having a guide for how much to spend could help you protect against overspending and will narrow your focus to buying only what you need.
- Plan for repayment. Spending with a credit card can be a great way to save money, as long as you have a sound plan for how you'll pay off your balance. If you plan to pay off your card balance immediately, great. If you plan to pay it back over time, consider the interest cost you'll pay for carrying a balance. Factor this into your budget and weigh it against any potential rewards—interest costs can easily undo rewards savings if you're not careful.
- Pay all your bills on time. Payment history is the most important aspect of your credit score, so it's always important to pay all your bills on time. As long as you've planned ahead and know what you can afford, this shouldn't be a big issue. If you end up overspending, make sure to do what you can to pay at least the minimum balance on your cards to remain in good standing and avoid any dings in your credit history.
If you plan on getting a new credit card prior to Prime Day, remember to leave enough time after you apply to receive your card in the mail (unless your card allows you to begin using it immediately). Also, be sure to check your credit before applying so you have a better idea of which cards you may be approved for. You can get a free copy of your credit report and scores from Experian and can use the Experian CreditMatch™ tool to get paired with cards based on your creditworthiness.