The key to getting the most from your reward credit card is to understand the rules of the reward program and to set your personal plan based on those rules. Keep in mind that different Issuers implement varying Terms and Conditions, depending on the type of reward credit card they offer.
In this article, we present practical tips on how you can maximize your reward credit cards points without getting yourself in debt trouble:
Know how points are earned. What types of purchases qualify you to earn reward points? Some reward credit cards only give points to selected types of purchases such as purchases made from affiliated merchants. If you buy items from merchants that are not affiliated with your credit card, then you may not be getting any point at all.
Plan your purchases ahead. It’s a good idea to set a goal as to the number of points that you plan to collect each month. Jot down the items that you need to buy and use your reward credit card for payment. By preparing a list, you can avoid charging expenses to your credit card that are way out of your budget.
Remember, you should never spend more than what you need just so you can collect reward points. If you do, there is a chance that you will not be able to pay your balance in full so you may incur high interest rates.
Rack up your points wisely. Aside from your groceries, what other expenses can you charge to your credit card? To get extra points without spending more than what your budget allow, you can pay your utility bills with your reward credit card. Since you will have to pay for these bills in cash anyway, might as well charge it to your rewards card first. However, be sure to use your cash and pay it off on the same day to avoid the risk of bad debt.
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Never pay the interest rate. Owners of reward credit cards must be particularly conscious about paying off their monthly charges in full to avoid the extra APR costs, which can be pretty high for most reward cards. In fact, if you plan to carry a balance in your account on a regular basis, you may be better off with a non-reward credit card that offers a low rate of interest.
Avoid penalties. Paying on time means not having to pay late fees. But more importantly, bear in mind that being late with your payments can disqualify you from redeeming your hard-earned points. As a cardholder, you need to be conscious about your payment due dates. If you are having trouble remembering them, then you may consider setting up an automatic payment system with your bank to avoid getting penalized.
Ann Wilson is the head writer of Reward Credit Card Site. This resource provides consumers with valuable reviews and information on the best credit card reward programs. Its main objective is to help people to take advantage of credit card rewards and start earning reward points. Copyright © 2008
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