Finding The Credit Card That Pays the Best Rewards

You can find a wide variety of credit cards that issue some type of reward system on your purchases. You may even find a card that will reward you with cash if you look hard enough.

You usually don’t receive any rewards when you transfer balances from one credit card to another. However, each time you use your card, you will earn points or rewards that you can redeem for a wide variety of gifts, airline miles or gift certificates.

The credit card companies think they are sly when they offer rewards. They are really encouraging you to accumulate more debt by spending more. The companies profit from this in two ways; first, they make money from the interest charges you end up paying. They also receive 1% from the retailer on the amount you charged.

Keep in mind that a credit card that carries a high interest charge will end up costing more than the rewards are worth. You should always try and pay the balance in full on your credit card before the interest charges are activated. Although this can often be very difficult, it’s definitely a goal worth trying to achieve.

Avoid the Big Credit Card Companies

The big credit card providers offer little incentive to join their rewards program. Often you have to spend quite a significant amount of money before you receive any type of reward worth redeeming. The interest rates are also normally much higher than a smaller provider can offer you. Many times, the smaller companies offer more rewards and/or points when you utilize their cards.

How to Find the Best Reward Plan

When you are searching for a credit card that offers a reward plan, remember that all points and rewards are not worth the same value. You can become quite confused because one company may offer you one particular reward, while another company may offer you something completely different.

When you utilize a credit card that offers miles for airline tickets, there are often many black out dates when you will be unable to fly using your points. Some of the cards place numerous restrictions on their mileage redemption. You need to read the fine print before you sign or join any program. You also have to take into consideration the various airport and tax fees. Your “free” ticket can end up costing you hundreds of dollars.

Your best bet is to find a small company that provides a credit card with a low rate of interest that offers cash as the reward. Sometimes you can have the amount you have earned deducted from your credit card instead of receiving a cheque for cash.

Use Those Points

When you rack up points and rewards, be sure you use them. Sometimes you have a certain time frame after which they will become null and void. Before using your points or rewards for certain items, do some comparison shopping to ensure you are using your points to your best advantage.

These programs work best for those individuals who use their cards frequently such as business owners and business travelers. Otherwise, you may be spending more money just to receive rewards which defeats the purpose!