Credit Card eZine - News and Articles about Credit Cards

Learning about the credit card deals that tie in rewards!

2007-07-13

It shouldn’t be a secret by now- credit card companies want your business! From lower interest rate credit cards to no annual fees, these credit card companies will offer whatever they can to get customers to come to them. One of the latest and most popular trends that have been undertaken has been the rewards programs.

Rewards programs pretty much give customers a reason to spend because they are sure to get something back just for using their cards. Rewards programs can be pretty attractive but a card holder must decide whether they are right for them or not.

What can you get from a rewards program credit card? Well, pretty much anything under the sun! Credit card companies are offering frequent flier miles; cash back rebates, gasoline credit cards and hotel discount credit cards! Plus, you can get discounts at many of the most popular retailers from Wal-Mart to Starbucks!

In today’s market nearly half of the credit cards are tied up in some way with a rewards program. And a great thing about it is most of these cards don’t have annual fees (outside of most airline miles cards). Only one thing- most rewards program credit cards have higher APRs than regular unsecured credit cards.

It is this reason that most credit counselors will advise you from getting a card if you carry a usual balance. The high APR of rewards credit cards can literally cost you hundreds of extra charges that will nullify any benefits that you may earn. Only get one of these credit cards if it makes financial sense!

Shopping around for the right rewards program credit card can be a fun time and an interesting time as well. Comparing the best credit card deals means doing your homework. The right rewards card will have a lot to do with your personal preferences and your spending habits.

One of the best examples of this is frequent flier miles credit cards. These airline miles are run through one of the many airlines and they award people with free tickets after they have spent a certain amount. The problem with these cards is that in order to get one free airline ticket (within the continental United States) you would need to obtain 25,000 bonus points.

Most credit card companies figure one point per dollar spent on your card (although you may get more points for certain purchases). This means you would need to spend around $25,000 just to get a free plane ticket! If you don’t spend a lot of money on your credit card then you may want to think twice before applying for a credit card with frequent flier miles!

The best bet would be to get a rewards credit card that offers a variety of reward options. A card that will give you the choice of merchandise, hotel discounts, restaurant gift certificates or airline miles is probably the best option for most consumers.

Another popular form of rewards cards that people often get involved in is the cash back credit cards. These credit card rebates reward consumers for spending on a daily basis because they promise 1% to 5% (typically) back from your purchases. So, if you spend $100 you will get $1 to $5 credited back to your credit card. Most credit card companies allow their card holders the choice of either getting their money credited to their accounts or mailed to them in check form.

Here are a few guidelines for better credit card rewards management. They will help you get the most advantages out of your card!

• Only get one rewards program! Sure, these programs can be pretty enticing but if you stick to only one credit card for your purchases you will add up rewards much quicker. The more you spend the better rewards you will get! Maximum rewards come from using one credit card.
• Don’t get a rewards program credit card if you don’t plan to pay it off- in full! Since the interest rates on these cards are usually pretty high it is smart to only get one if you plan to pay off your entire balance each month! If you don’t, you risk getting hit with finance charges through the roof!
• Get a variety of rewards benefits! Don’t just settle for a strict card that forces you to use your rewards points in one way. You don’t want to be stuck in a rewards program that isn’t flexible because you won’t have the variety you could get otherwise.