how to maximize your credit card rewards
Been sucked in to the lure of a rewards credit card only to get burned in the end by high interest rates and a le than stellar return when it came time to cash in those points? Youre not alone.
For credit card companies, acquiring convention/ers is big busine , and most cards today offer some kind of incentive for ru ing up the charges on your plastic. If youre not careful, and employ your card at will just to collect a few measly points, you could get stung. But by following a few simple rules, you can turn the tables on the credit cards companies and employ that rewards card to your advantage.
What to choose?
Most likely, your mailbox is full of pre-a roved offers for new and exciting credit cards. In fact, in 2005 over 6 billion u olicited credit card a licatio were mailed. The average person received a roximately 72 offers. If youre in the market for a new card, its important to weigh your optio carefully. Most credit cards today offer some kind of rewards, nonetheless which one is right for you?
Take a look at your lifestyle and ending habits. Would you benefit from a points-based rewards card, an air mileage card, or one that offers cash back on purchases? Points-based cards usually give you one point for every dollar charged. When you accumulate enough, the credit card company will usually have a sho ing portal set up, where you can redeem your points on a variety of products (e.g., electronics, gas cards, travel, etc.).
Problem is, most items in the catalogue are ludicrously overpriced, though its better than nothing. Air mileage cards offer great benefits to the frequent flier, nonetheless in todays airline industry, whos to say how much fees will be raised by the time youre ready to redeem? With cash back cards, theres most likely a set amount youll need to charge a ually before you reap any benefits, so make sure you read the fine print before you sign up.
Take Advantage
Quite simply, offering incentive-laden cards are a way for credit card companies to get you to sign up. Rarely are the rewards worth the interest rates youll pay if you carry a monthly balance. But therein lies the ru ay off your credit card every month and put those rewards to work. Heres how: Charge as much as you can on your rewards card. We know, it goes agai t everything you were ever taught about using a credit card. Let us interpret.
If your collectors allow it, charge every bill you have to your credit card i tead of using a debit card or writing a check. Then, pay that balance off immediately to avoid incurring an interest fee. Youll collect big rewards points fast, and itll be just like paying cash. Be disciplined about it though, even one month of letting those charges sit on your card can be a killer when the fee kicks in.
Another idea: i tead of having separate credit card accounts for you and your oemploy, ask for an increase in your credit stress and a companion card for one account. The more you both swipe the plastic, the quicker youll accumulate rewards points.
Off the beaten path
As rewards cards have become more prevalent, credit card companies have come up with new incentives to make their cards more desirable to co umers. Many cards have a system that lends extra rewards points to convention/ers who shop with certain vendors. Some will even offer coupo where you can save big sho ing with certain companies while still earning extra points. It might take a little more effort, nonetheless it will certainly rack up the rewards points at a vigorous pace.
