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Personal Finance

These 4 unconventional money tips from Reddit actually work, say personal finance experts

Our experts explain how these pieces of unconventional advice can help your finances.

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Pablo Rasero | Istock | Getty Images

Social media is flooded with money-making tips, wealth-building advice and all sorts of hot takes to help the average user finesse their finances — most of which should be taken with a shaker's worth of salt. But after combing through a Reddit thread on "unconventional personal finance tips," CNBC Select ran some ideas by certified financial planners and other experts to hear their take. Here are the four personal finance tips they recommend as helpful for most people.

1. Apply credit card rewards toward your long-term goals

Credit card rewards can do more than just help make that next vacation a bit more affordable. They can be used to better your long-term financial health.

Brian Walsh, a CFP at SoFi, has firsthand experience seeing this tip in action. "Most people I work with are much better off putting their credit card rewards toward their financial goals instead of on fun things like travel," he tells CNBC Select. For example, you can use the cash back from your credit card to fund your retirement account, grow your savings or pay down high-interest debt.

If you use a credit card like the no-annual-fee Chase Freedom Unlimited®, you'll earn 6.5% cash back on travel purchased through Chase Travel, 4.5% cash back on drugstore purchases and dining at restaurants (including takeout and eligible delivery service), and 3% on all other purchases (on up to $20,000 spent in the first year). After your first year or $20,000 spent, enjoy 5% cash back on travel purchased through Chase Travel, 3% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service, and unlimited 1.5% cash back on all other purchases. You can then use those cash-back rewards to pay down your credit card balance when you redeem them as a statement credit. This means your rewards are helping you live free from debt or reducing your monthly bills overall.

Chase Freedom Unlimited®

On Chase's secure site
  • Rewards

    Enjoy 4.5% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery services, 6.5% cash back on travel purchased through Chase Travel, our premier rewards program that lets you redeem rewards for cash back, travel, gift cards and more; and 3% cash back on all other purchases (on up to $20,000 spent in the first year). After your first year or $20,000 spent, enjoy 5% cash back on travel purchased through Chase Travel, 3% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service, and unlimited 1.5% cash back on all other purchases.

  • Welcome bonus

    INTRO OFFER: Earn an additional 1.5% cash back on everything you buy (on up to $20,000 spent in the first year) - worth up to $300 cash back!

  • Annual fee

    $0

  • Intro APR

    0% for the first 15 months from account opening on purchases and balance transfers

  • Regular APR

    20.49% - 29.24% variable

  • Balance transfer fee

    Intro fee of either $5 or 3% of the amount of each transfer, whichever is greater, on transfers made within 60 days of account opening. After that, either $5 or 5% of the amount of each transfer, whichever is greater.

  • Foreign transaction fee

    3%

  • Credit needed

    Excellent/Good

  • Member FDIC. Terms apply.

In addition to applying credit card rewards toward your financial goals, you can also maximize rewards by using them for purchases you already know you'll make (rather than using them as an excuse for additional spending). If you plan on carrying a balance (which is almost never a good idea), any rewards you earn will be negated by interest fees.

Marguerita Cheng, a CFP at Blue Ocean Global Wealth, says treating her kids is an important goal for her. She cashes in her rewards for gift cards so her younger kids can purchase something for themselves. "My son and daughter were happy to be able to spend $200 each on Nike gear," she says.

2. Save your savings

We all love a good deal, but scoring an item on sale gets even better when it helps boost your savings. The next time you buy something on sale, move that money you "saved" to an actual savings account. For example, if you buy a pair of shoes originally priced at $100 but are on sale for $80, take that $20 you saved and put it into your savings account.

Walsh identifies this technique as a powerful way to save money without having to think too hard about it. And Ramona Ortega, founder and CEO of fintech company My Money My Future, agrees. "Micro money habits are part of creating better habits all around," Ortega says. "This is one way to allocate those 'savings.'" Walsh just adds the caveat to make sure you don't use sales as a reason to buy things you don't need.

Where you stash your savings matters, too. Online high-yield saving accounts offer much higher returns than your traditional brick-and-mortar savings accounts, plus they're accessible if you ever need to tap into your funds. With the below accounts, you have the chance to earn a strong APY north of 4.00%:

LendingClub High-Yield Savings

LendingClub Bank, N.A., Member FDIC
  • Annual Percentage Yield (APY)

    5.00%

  • Minimum balance

    No minimum balance requirement after $100.00 to open the account

  • Monthly fee

    None

  • Maximum transactions

    None

  • Excessive transactions fee

    None

  • Overdraft fees

    N/A

  • Offer checking account?

    Yes

  • Offer ATM card?

    Yes

Terms apply.

UFB Secure Savings

UFB Secure Savings is offered by Axos Bank ® , a Member FDIC.
  • Annual Percentage Yield (APY)

    Up to 5.25% APY on any savings balance; add a UFB Freedom Checking and meet checking account qualifications to get an additional up to 0.20% APY on savings

  • Minimum balance

    $0, no minimum deposit or balance needed for savings

  • Fees

    No monthly maintenance or service fees

  • Overdraft fee

    Overdraft fees may be charged, according to the terms; overdraft protection available

  • ATM access

    Free ATM card with unlimited withdrawals

  • Maximum transactions

    6 per month; terms apply

  • Terms apply.

Bask Interest Savings Account

Bask Bank and BankDirect are divisions of Texas Capital Bank, Member FDIC.
  • Annual Percentage Yield (APY)

    5.10% APY1

  • Minimum balance

    None

  • Monthly fee

    None

  • Maximum transactions

    Up to 6 free withdrawals or transfers per statement cycle

  • Excessive transactions fee

    None

  • Overdraft fee

    None

  • Offer checking account?

    No

  • Offer ATM card?

    No

Terms apply.

1Annual Percentage Yields (APY) and Interest Rates shown are offered on accounts accepted by Bask Bank and effective per the dates shown above, unless otherwise noted. Annual Percentage Yield is variable and subject to change at any time. No minimum balance requirement and no monthly service charge. Must fund within 15 business days of account opening.

3. Buy basics on sale in bulk

Consider buying in bulk everyday items you routinely use (think toothpaste, deodorant, etc.) whenever they're discounted. It's worth pointing out that this is actually advice touted by Mark Cuban himself.

This is a good tip because, as Walsh points out, buying essential, non-perishable items in bulk for less money can be a great way to reduce spending and save trips to the store. "Fewer trips to the store not only saves time but help you avoid the temptation of walking around the store while trying not to waste money on things you don't need," Walsh adds.

Plus, given you're going to end up buying these basics again when you run out, you might as well get them for a deal while it lasts.

4. Think of expenses in terms of hours of work

When you go to make a purchase — and ideally a big purchase — it's helpful to reframe how much that expense really costs you by converting the price from dollars to the number of hours you'd need to work to afford the purchase.

For example, say you are looking to buy a new couch for $1,500. If you make $50 per hour, that couch will cost you work 30 hours of work — almost a full 40-hour work week. The idea is that by looking at prices through a different lens, you can better evaluate whether a purchase is worth the expense.

Walsh is all-in on this tip: "I love the idea of understanding the true cost of purchases because it helps you better understand what you are actually trading for that new outfit, concert or car," he says. "Understanding this tradeoff can help you appreciate the value of reduced spending and saving."

Walsh also emphasizes you should consider not just the amount of time you would have to work to afford a purchase, but also the amount of time you plan to spend using that item. For example, "most people spend way more on a car as a percentage of their income compared to the time they spend in a car on a regular basis," he explains.

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Bottom line

Not all (or even most) personal finance advice you find on social media is good. But the four tips above have been vetted by financial experts and can help you reach your goals.

Catch up on Select's in-depth coverage of personal financetech and toolswellness and more, and follow us on FacebookInstagram and Twitter to stay up to date.

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.
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