To enjoy the benefits that a reward credit card offers, it’s important to know how you can manage your account effectively. On this post, we present tips on how you can make the most out of a credit card rewards program.
Avoid APR charges. You should avoid paying the interest rate at all costs. Since credit cards with rewards typically carry higher interest rates than non-reward cards, you could end up paying anywhere from 15% to 20% more than the original amount of your purchase if you fail to pay your balance in full. Thus, before using your reward credit card, ask yourself, “Will I be able to pay my balance in full on time?”
Get points from all transactions. Will you be able to get points for all types of transactions? Some of the best rewards credit cards may offer to give more points for every dollar but only on selected types of purchases. For instance, you might be given double points for every dollar on purchases made at affiliate shops. However, you may not get any point at all from other purchases.
Charge expenses that you will pay in cash anyway. After making sure that you will get points for all types of transactions, you should use your reward credit card to pay monthly utility services such as electricity, cable, internet, phone bills, etc. Since you need to pay off these bills with cash anyways, why not charge it to your reward credit card first so you can get points as well? This is a good strategy to rack up points without having to buy anything with your credit card. However, you should make sure that you will be able to pay off your credit card balance on time.
Earn extra points from affiliates. Find out which merchants are affiliated with your reward credit card and maximize your potential to earn bonus points. If you are still in the process of searching for a reward card, choose one that is sponsored by shops and businesses that you patronize.
Don’t let your points expire. Some reward credit cards impose an expiration period when it comes to redeeming rewards so if you fail to exchange your points within the specified period, you could end up losing all your hard-earned points. The ideal reward credit card should allow you to carry over unused points until you collect enough to redeem your much-deserved reward.
Avoid penalty charges. Late fees and over-the-limit fees can prove to be expensive. By complying with your issuer’s terms and conditions, you can avoid violations and save yourself from paying the extra costs.
Review the terms and conditions regularly. Even if you have been using your reward credit card for quite some time, it is recommended that you review the rules of your issuer from time to time. It’s always good to familiarize yourself with the reward system so you can plan the right strategy to earn more points while avoiding the risk of bad credit.