When you use a credit card with a reward point system, you earn a certain number of points that you can then turn into a reward of your choice. It could be air miles, a gift card, or some kind of purchase. But if you want to get the most out of a reward card, you should make sure it gives you a good deal for your money. Did you know that getting a free ticket within the US could take more than five years and cost more than $5,000?
Credit card companies use rewards as a way to get people to use their cards. Before you give in to the temptation, take a look at your monthly income, expenses, and loans. If you can't pay all your bills every month, don't open the door to a financial storm. The interest rates on reward cards are usually at least 2% to 3% higher than those on other cards.
If you like to travel, you can use reward points like frequent flyer miles. Check out the options that come with your credit card.
- A cash rebate is a feature of many cards. The offer hides a higher interest rate, and if you can't pay off your bill right away, you'll spend a lot more on the rebate than you'll get back.
- Be smart Use the reward points as soon as you can, before the card company lowers the value of the points you've earned.
- Use the rewards card every month to pay for groceries and bills. It's an important purchase that can earn you valuable reward points.
- Use the card that gives you rewards regularly, but make sure you can pay off your balance each month. If you can't, the interest you pay will cancel out the rewards you earn.
- Always know as much as you can about the cards you have. Check consumer reviews and www.cardratings.com.
- If you need to pay your mortgage and the bank accepts credit cards, use your credit card to pay and earn reward points. But the debt needs to be paid off right away.
- Find out if your reward points can be used to pay for your annual fees. If you have a card with no annual fee, choose rewards that will be useful to you, such as gas, help with travel, incentives for retirement, frequent flyer miles, or cash back. Do a lot of research and pick a plan that will work for you.
- Use a card that gives you a lot of choices. Then you can choose from a huge number of items.
For a rewards programme to be worth it, you'll need to use your credit card a lot. By using the card to pay for utilities, groceries, prescriptions, mortgages, and other things, you can get a lot of points, maybe even enough to get a thousand dollars a year. Be smart with your money and don't spend more than you can afford.
