This isn’t so much only applicable to Millennials, but it’s important for a generation widely considered financially irresponsible to find every way to save a few extra cents here and there. Cashback sites are simple. Essentially they are mass directories of affiliate programs for many online and brick and mortar retailers. If you click their link before purchasing from a website, they will split the affiliate commission which varies from company to company with you. This essentially creates a win-win-win scenario for the retailer, affiliate directory, and consumer. From a consumer perspective, however, it’s a way to offset a few percent of every purchase without any additional work or research on your part. Before I give you my recommendations for the best cash-back sites, let’s take a look at what it might mean for your pocketbook.
Scenario: Travel — An Asheville Family Vacation
Let’s say that you are looking to take your family of three on a week-long vacation to Asheville, NC. Maybe you are looking to spend some time enjoying the beer culture, or simply want to take your kid to see the majesty of the Biltmore Estates. However, to get there you are going to need three airline tickets and a hotel to stay in for six nights. So let’s say that the airline tickets are going to cost you $240 apiece, and you decided to stay at a nice downtown Marriot hotel for $220/night. Your total out-of-pocket expenses for travel and lodgings come out to $2,040. Now, let’s take a look at how much you could potentially get back depending on how you booked your vacation.
Booking.com — 7% Cashback — Does not include flights = $92.40
Travelocity.com — 10.25% Cashback on Hotels & $2.75/flight = $143.50
Expedia.com — 6% back on hotels — $2.50/flight = $86.70
Hotels.com — 2% back on hotels — Does not include flights= $26.40
Now, each of these sites may have slightly different fares or hotel rates, but when making a decision you can now take into consideration the amount you will be getting back FREE. If you ended up being able to use Travelocity, you could potentially all go to the Biltmore Estates for $50/person, and it would cost you nothing.
Scenario 2: Consumer Goods — A New Set Of Running Shoes
This time let’s take a look at a more common scenario. Assuming you are a runner, you know that shoes generally have a pretty short lifespan, especially when you are putting several miles on them weekly. This means that you may be looking at buying 3–4 new pairs of running shoes a year or more. Now, running shoes are not cheap. Oftentimes they can run upwards of $100 a pair. Assuming you are looking to buy 4 pairs of Nike running shoes over a year you could potentially be saving:
Nike.com — 10% Cashback = $40/year
Footlocker.com — 4% Cashback — $12/year
FinishLine.com — 7% Cashback — $28/year
Puma.com(Assuming you are willing to switch brands)- 12% Cashback — $48/year
So again, this is just another opportunity where a consumer could potentially save $12-$48/year simply by leveraging one of these existing cashback sites.
Hopefully, by now I have at least given you enough food for thought to consider using a cashback site. The next question is inevitable, which one? Well, there are a few major players in this arena and they include:
Topcashback.com — Arguably my favorite, these guys typically have really good cashback options, and better payout perks (more on that later)
Rakuten.com — Owned by the major Japanese shopping conglomerate Rakuten, this site has nice signup perks but tends to have lower cashback on most categories. Sometimes it is worth checking out their double cashback section though.
Joinhoney.com — known more as a coupon chrome extension, this company now offers a program that allows you to earn “gold” whenever you make purchases which can be redeemed for gift cards.
Raise.com — Again, another company known for something else. In this case, they are known as a discount gift card outlet but have recently implemented a decent cashback program to boot.
Once you choose which platform is right for you (oftentimes it will vary from purchase to purchase, so I recommend signing up for all of them), all that is left to do is shop and then get your payout. So, lastly, let me leave you with a few tips for payouts!
Once your money becomes available, typically once the return/refund period has expired for the purchase, you will be eligible for a payout. This is where the platforms truly do differ.
Topcashback.com — payouts can be taken in several different forms ranging from gift cards to ACH deposits and everything in between. Different payout forms will include additional bonuses. For my last payout, I was able to snag an additional 7% on the entire value of my cashback by taking a virtual visa gift card. This takes that 7% you earned earlier and now makes its 14% total cash back on a purchase. Payouts are another opportunity especially with this site to make your money go further.
Rakuten.com — This company is a little behind the times in my opinion and offers your payout in the form of a check once quarterly. This reduces your opportunity to tack on additional earnings, so I recommend only using Rakuten when the increase in cashback is substantial.
Joinhoney.com — The payouts for this site are taken in the form of gift cards to your favorite stores. Typically again you won’t get additional percentages here, and also miss out on the opportunity to withdraw it as cash.
Raise.com — The opposite of honey, Raise only offers payouts as an AHC transfer, PayPal, or check (with a $30 fee). Again, I recommend only using this site if the cashback is substantially higher than the other options.
So there you have it. A semi-exhaustive look at why you should be using cashback sites for almost every purchase. Tack on some additional credit card cashback and you can end up getting upwards of 15–20% back on your purchases when everything is said and done!