Reward credit cards are an increasingly popular choice among credit card offers today. Although reward credit cards tend to carry a higher APR (Annual Percentage Rate), they offer various reward incentives that can be quite appealing to the savvy spender. Depending on your shopping interests and financial responsibility, reward credit cards can help you build good credit while earning points or dollars for many of the purchases you make.
How Credit Cards With Rewards Work
A rewards card works very simply by giving you points or dollars for every qualifying dollar that you purchase with that particular card. For example, if you have a Cash Back rewards card that gives you 1% of every dollar you spend, you will earn $.01 for every $1.00 you charge. This does not seem like much of a reward, but it can add up quickly. $100.00 in purchases will earn you $1.00 in cash back. If you choose a Cash Back rewards card and use it for your monthly spending, such as gas, groceries, and utilities, and you pay your bill in full every month, you can easily reap the benefits of a rewards program. However, if you are late paying your bill or carry a high balance, the fees and interest charges can far exceed the cost of any rewards that you may have earned.
Kinds Of Rewards Available
Reward credit cards are usually available in points or dollars depending on the card you choose. Some programs strictly offer cash back incentives, while others allow you to choose airline mileage or merchandise. When deciding on your rewards card, consider what you would like to earn and which program is best suited for your needs. Perhaps you drive a lot and would rather earn 2% cash back on gasoline purchases than airline miles. Or maybe you don’t desire a cash back reward because instead of saving it you’ll spend it, and you would much rather have a card that will let you accumulate points for a long awaited vacation. With the numerous options available today, you can easily find a card to fit your lifestyle.
Some rewards cards will give you online shopping access to specific stores in their rewards program network that will allow you to earn even more bonus points when shopping with those merchants using your card. Other cards will give you bonus points for spending your earned points with select vendors. Most cards will allow you to apply your rewards directly as a credit to your statement. Frequently, the more points you have, the higher the value you can receive. For example, if 10,000 points is worth a $75 statement credit, 20,000 points may be worth a $200 credit to your statement. That same 20,000 points may only be worth $150 sent to you via direct deposit or a check in the mail. Before cashing in your points, review all of your rewards to find the one that will give you the most benefit.
If Reward Credit Cards Are Rewarding, How Can They Be Bad?
Reward credit cards are intended to reward customers for using that specific card. However, they oftentimes come with a list of rules (also known as fine print) that need to be adhered to. Otherwise points can be forfeited or card costs can be greater than the rewards earned. In addition to common knowledge that late payment fees and finance charges can become expensive, there are caveats that many cardholders do not realize until they have already lost their rewards.
Some rewards expire if you are late making a payment; others expire one year after they were issued. Cash back can sometimes only be withdrawn in certain increments, such as redeeming your points after $25 has been accumulated. Some purchases do not qualify for specific rewards programs and therefore do not earn any rewards.
Tips For Using A Rewards Credit Card
Every card and every program is different, so be sure to read the rules and regulations surrounding your specific program so that you understand it in its entirety. Also read all of the updates you receive regarding your rewards plan because they are subject to change at any given time. For example, if you were always allowed to accumulate your points and roll them over year to year and now suddenly you have twelve months before your points expire, you want to know about that. Reward cards can be very beneficial, but you need to be a smart consumer.
Chase Down The Best Reward Credit Card Now!
In order to quickly compare your options, take advantage of the free credit card chaser provided above. This will give you answers to your questions about available rewards, costs and benefits. Use the credit card chaser now to start earning your rewards as soon as possible!
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