These days you can't make it far without your phone. If it breaks you've got to replace it quick, but it's not easy to cough up all that money at once. Lucky for you there are ways you can minimize the hit on your wallet. It all depends on how much you can leverage your perks, bonuses, and warranties toward the purchase.
If you need to replace your broken phone without breaking the bank, try one of these three methods:
Find an existing warranty
First thing's first: you need to check whether your phone is already covered by a warranty. Go through your receipts and emails to see whether you got some sort of coverage plan when you originally bought the phone. In the best-case scenario, your phone is still covered by a manufacturer's warranty, and you'll get a new one for free.
If you're pouring over receipts and still don't see any warranty information, don't resign yourself to defeat just yet. You may still be covered under an existing warranty if you bought the phone with a credit card. Some credit cards extend a manufacturer's warranty, usually for an extra year after the manufacturer's coverage expires. If your card covers you, you'll usually have to provide some proof of purchase, like a store receipt or account statement. You might also have to provide a copy of the manufacturer's original warranty.
If you can manage to gather all those documents together, your credit card company may reimburse you for some (or all) of the new phone's cost.
Use phone protection perks
Warranty extensions may help replace your phone, but some cards can exclude phones from the warranty policy. And if you bought your phone second-hand, it probably isn't covered by a manufacturer's warranty. That means your credit card won't cover it either.
If either of those is the case for you, you should look into whether your credit card has a phone-specific perk program.
The Wells Fargo Propel American Express Card is one card that offers those kinds of perks. If your phone gets damaged or stolen, Wells Fargo will reimburse you for the value of the phone up to $600. The card itself doesn't have an annual fee, which makes the reimbursement perk an even better deal.
However, the perks aren't entirely without conditions. You'll only qualify for coverage if you pay your monthly phone bill with the Propel card. It's also important to keep in mind that Wells Fargo's coverage is supplemental. That means it only applies to phones that aren't covered by any other type of insurance policy. If your phone is still under a manufacturer's warranty, you can't ask Wells Fargo for reimbursement. If you meet all the conditions you can make up to two claims a year for a maximum reimbursement of $1,200, but each payout will be subject to a $25 deductible.
Chase also offers phone protection through its Ink Business Preferred card. It's intended for businesses, but that can include very small businesses and even freelancers. Conditions of the coverage are similar to the Wells Fargo card. It's considered supplemental protection, and it maxes out at $600 per claim. Unlike the Wells Fargo card, it allows for up to three claims per year, but the deductible is $100. It also covers more phones – yours and anyone else whose number is listed on the bill. Last but not least, you'll pay an annual fee of $95 for this card.
Those are just two cards with phone protection perks, but there are lots more. Wells Fargo and Chase both offer multiple cards with phone protection. U.S. Bank's Visa Platinum Card offers phone protection that's very similar to Wells Fargo, as does the Uber Visa Card from Barclays. You'll find slightly different protection perks from both First Citizens Bank and Fifth Third Bank.
If you don't have a card with phone protection but you want to get one, it's important to pay attention to the fine print. The key to finding the right credit card is picking a well-rounded program that'll fit in with your financial goals.
Maximize cashback rewards
Even if you don't have a phone protection perk, your credit card most likely has a cashback reward system. If you need to buy a new phone, cashback rewards can help subsidize the purchase and cushion the blow to your wallet. There are a few ways to maximize your rewards, but the strategy depends on the type of rewards program.
Some cards, like the Chase Freedom Card, offer 5% cash back for specific purchases. The type of purchase rotates every few months. For example, you may get 5% cash back at gas stations, toll bridges and pharmacies for a few months, before all the categories are swapped out for new ones. All other purchases get 1% cash back.
If your spending is predictable, you might want a steadier rewards program that reflects those spending habits. Fixed cashback reward programs always offer higher percentage cash back on specific purchases. If you shop at any one store often, you can check to see if they have their own signature credit card. The Amazon Rewards Visa Signature Card, for example, offers 5% back at Amazon and Whole Foods, 2% at restaurants, gas stations and drugstores, and 1% everywhere else.
If all these options are overwhelming, you can opt for a no-frills cashback rewards program that offers the same rewards for all purchases. The percentage won't be as high as the highest cashback percentages offered by the Chase Freedom Card or Amazon Rewards, but it'll be higher than the 1% often found at the bottom of those tiered programs. The Fidelity Rewards Visa Signature Card offers 2% cash back on all purchases – no matter how much you spend or where you spend it.