What to Look for and Avoid with Rewards Credit Cards

It was not that long ago that the only reward anyone seemed to offer or care about was air miles. While air miles cards are still quite popular, there is a vast array of rewards that you can find and get your hands on now thanks to new reward credit cards, and they often sound like the perfect deal for anyone. You use your credit card to make purchases and then earn points that can be used for gifts such as iPods or even free vacations.

These rewards cards can be a huge boost but also come with a number of factors that you need to be aware of and consider before lighting up your card like a Christmas tree.

Always remember that not all rewards cards are equally as rewarding, so here are a few important things to consider when weighing your rewards cards options.

Why do you Want a Rewards Card?

This is the first question that you need to ask when shopping around for credit cards. Are you enticed by the rewards offered by certain retail stores, or do you want to save money on your next big vacation? Whatever it is that you look forward to, you should make sure that your card offers it. Sounds basic enough, but there are many consumers out there stuck with all kinds of air miles when all they wanted was a few discounts here and there. On top of that, if you are looking to gather air miles, make sure that your card doesn’t offer limited service to your local airport: that way you can make the most of the benefits your card brings.

Some cards may sound great because they offer double bonus points, but they may only be offered for purchases of clothing or groceries. If you only use your credit card for vacations and gas, then you should look elsewhere.

Read the Fine Print

Always read the fine print when signing up for a rewards credit card. Some rewards cards make it seem like earning rewards is simple, but when you read the fine print, you realize that most rewards are not matched dollar for dollar. For example, you may need to spend $2,000 to receive 500 points, and if you opt for a rewards card that offers gift certificates, you may have to spend $1,000 to get a $10 credit.

While that $10 credit is of course better than nothing, reading the fine print will allow you to shop around and find a more appropriate rewards card. Do the math, focus on the details, and you will be rewarded with a better deal in the long run.

Use your Card Often

It is a great idea to use your rewards card as often as you can, if you want to receive the most benefits possible. This does not mean that you should be carrying a balance from month to month or start racking up debt, but you should use your card in the same way you would use cash. Use your card when shopping and then head home and pay off the bill right away or before the end of month. This means you won’t pay any interest, but will also show you how quickly you are capable or racking up points and rewards.

Don’t Lose your Rewards

One of the big drawbacks for people that use rewards cards is the fact that most come with a timeline. Always take the extra time to consider blackout and expiration dates or anything else that could negate the use of your rewards. There is not much worse than compiling all kinds of rewards over a year only to lose them before you can use them.

In the end, rewards credit cards can be a huge boon to your lifestyle as long as you choose the right one and learn how to use it. If you are going to be spending the money anyways, why not try and get something back for it?

Just be diligent about paying the card off on time and pick a card that offers useful rewards, and you will learn that it isn’t all bad when it comes to using plastic these days.