How to Turn Rebate Cards into Extra Debt Payments

by Julie on January 24, 2012 · 11 comments

Rebate cards like these can help you with your goal to pay off debt.

The holidays are over and we’re making a final push to get all of our non-mortgage debt paid off in 2012.

Enter the return of found money.

Since the first of the year, we’ve received two rebates totaling $140:

  • A $40 tire rebate for a new set of tires we put on my van last fall.
  • A $100 Apple rebate from the new computer I bought right before Christmas, when my laptop died in a most spectacular way.

And last week I sent $140 to our home equity loan as an extra payment.

How to Turn Rebate Cards into Extra Debt Payments

Rebates are one of my best sources of found money. But they don’t always come in the form of a check.

More and more, I’m getting rebates in the form of a card, like this Visa debit card we got for our tires. And you can’t exactly send one of these in as an extra payment on your credit card, mortgage, or home equity loan.

But here’s what you can do:

  1. Use the rebate card on something you would have bought anyway (i.e. groceries or gas).
  2. Send the amount of the rebate as an extra debt payment.

The mechanics of it aren’t hard. The keys are seeing the card as a debt snowflake (and not an excuse to splurge on something unplanned) and then following through on sending the extra payment in.

Once you’ve committed to do those things, you will probably find yourself searching high and low for rebates and other sources of found money. They can add up to big things.

Honestly, it’s a little embarrassing how excited I get when these bits of found money find their way to me and I know I get to make an extra payment.

Are you addicted to debt reduction (or saving)? Do your rebates have a job? Talk about it in the comments.

This post is linked to the Debt Snowflake Challenge @ Mom’s Plans.

{ 10 comments… read them below or add one }

JLLopez1006 January 24, 2012 at 3:55 pm

This is great thinking! I, too, get rebate checks and cash cards, and though I try to use them to pay for something I already would be paying for, like groceries or gas, I did not think to take that savings and apply it to pay down debt. Good way to think about things.

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Julie January 25, 2012 at 9:25 am

I’ve found it to be a pretty painless way to pay down debt, JLL. I have almost always forgotten about those rebates by the time they end up in my mailbox.

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tina January 24, 2012 at 8:44 pm

What a wonderful informative blog! We are in almost the same situation as you and your family, planning for retirement, paying cash for college etc. We have just a bit more non mortgage debt also, looking forward to reading about all your future successes, its so encouraging for the rest of us!

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Julie January 25, 2012 at 9:23 am

Tina, it’s a very challenging, but very rewarding stage of life we’re in, isn’t it? Thanks for the nice comment!

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Lisa January 26, 2012 at 11:22 am

My goal this year is to use the “found money” of coupons and store rewards in grocery shopping to help build my emergency fund. I’m a very frugal cook so I usually see good savings at the end of the ticket (even though the store sales are usually gimicks to make overpriced stuff seem cheap) So I’m trying each payday to “pay myself first” with this in addition to the budgeted savings amount. We’ll see if I can sustain this!

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Julie January 27, 2012 at 11:48 am

Lisa, I love it! The savings are rewarding on their own, I’m sure, but your satisfaction has to be multiplied as you watch that emergency fund grow. Thanks for the comment!

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Christa January 26, 2012 at 4:38 pm

I don’t get a lot of rebates, but when I do, I’ll have to follow this practice!

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Julie January 27, 2012 at 11:47 am

Christa, there are lots of other sources of found money. And if you’re not focused on debt reduction, you can give them some other job. Like preparing for baby. :)

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JoeTaxpayer January 26, 2012 at 10:45 pm

Our card rebates go into a 529 account for Jane2.0.
That account now has $12,000 in it. 5 years till college starts, hoping this account grows to pay for a full semester. That would be cool.
There are those who claim I must be spending more using the card (vs cash.) I’d prefer that risk than the risk of carrying wads of cash.

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Julie January 27, 2012 at 11:46 am

Nice use of rebates, Joe. I like that you’ve given them a job (sending your daughter to college). And depending on where you’re sending her to college, that account should pay for more than a semester.

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