Reward credit cards were supposed to be rewarding. Nonetheless, many people feel that they are not getting the rewards they deserve from their credit cards. In fact, there are big time spenders who get very little incentives in return. If you are a reward credit cardholder, do you feel the same way too? Below are practical tips on how to spend less and get more from a reward credit card:
Know your spending style. Different reward credit cards are designed for different lifestyles. If the rules of the reward program are not compatible with your spending, then you may find it difficult to collect points, let alone get rewarded.
For instance, airline miles reward credit cards are great for frequent travelers but if you don’t really go on plane trips, then obviously this credit card is not for you. On the other hand, if you drive a lot, then you may consider a gas reward credit card. For non-travelers and non-car owners, there are credit cards with cash back rewards.
Avoid expensive maintenance fees. If you need to spend big just to keep your reward credit card active, is it still worth keeping? Remember, if the value of fees exceeds the value of rewards you can earn, then you’re better off with a non-reward credit card with a low interest rate.
Avoid the high interest rates. If you own a reward credit card, see to it that you pay your monthly balances in full at all times. Aside from the rates, you can avoid late penalty fees and overdraft fees which can make repayment burdensome for you.
Avoid spending just to collect points. Fight the temptation to buy things that you don’t really need just to collect points. Such a habit can puts you at a greater risk of uncontrolled spending and bad credit. Instead, use your reward credit card only for planned purchases and to pay for utility bills that you need to pay in cash anyway. Nevertheless, make sure that you use your cash to pay your credit charges. To avoid bad credit, post your payments the same day you used your credit card to pay your utility bills.
Related Post: How to Earn More Points With Your Reward Credit Cards
Understand the rules and restrictions. All credit cards with rewards have their own set of rules and restrictions. For instance, is there a limit to the rewards you can earn? Will your points expire after a certain period? What kinds of purchases will earn you points? Understanding these conditions before submitting your application can save you from a lot of trouble and frustration later on.