How Do I Maximize Credit Card Rewards?

Earning rewards with your credit card is simple, but these cards are really only worth having if you exercise discipline.   Interest charges on a balance you carry or a few late fees are all it takes to eliminate any rewards benefits.

With a rewards credit card you earn points or cash back for every dollar you spend on the card.  Most points are roughly equivalent to $.01 when exchanged for travel cash back.  Most cash back rewards cards and other types of rewards cards will let you earn 1% of every dollar you spend, however some cards such as the Capital One Venture Rewards Credit Card let you earn 2% in rewards points and comes with a 25,000 miles sign up miles bonus.   There are some other great ways to maximize the points you earn with your rewards credit card.  When you choose a Cash Back rewards card and use it for certain categories such as gas, groceries, and utilities, you can easily bump up the benefits of a rewards program with ongoing and promotional 5% rewards earning rates (The Discover More Card is a perfect example of cards with these kinds of features.).

Kinds Of Rewards Available:

Reward credit cards come in all shapes, sizes and flavors.  Here are a few tips and tricks for the different ways to earn rewards: 

Cash Back Credit Cards are obviously the most flexible rewards.  Nothing is easier to use than cold hard cash.  You can opt to have your cash back deposited directly into your bank account or applied towards your credit card balance.  Pay attention to promotional increases to the rate in which you can earn cash back for certain categories, such as gas, books, music, dining, travel etc..  You may have to go to your card issuer’s website to register your card or give them a call to enroll your rewards credit card in certain promotions.

Gas Credit Cards are the best fit for consumers who drive a lot and would rather earn 2% cash back on gasoline purchases than other rewards points or airline miles. If you have a preferred gas station brand you frequent often, specific brand gas credit cards can be some of the most beneficial rewards credit cards. 

Airline Credit Cards are perfect for those who’d prefer to sock away airline miles to accumulate points for a long awaited vacation to Tahiti, Europe, or to visit your parents or in-laws.

Good Credit Sense:  When Rewards Credit Cards Can Turn On You

Card issuers offer rewards credit cards to entice customers to use their card over competitor cards.  However there are a couple things  you should familiarize yourself with:

Rewards Points can expire so make sure you have a card like the American Express Starwood Card with points that don’t ever expire if you think you’ll need to take some time before redeeming your rewards.

Late Payments can offset any rewards you earn as you’ll be hit with fees and finance charges.  Additionally, until your account is in good standing your accumulated rewards points may be frozen, and you may be disqualified for any promotional bonus points due to your late payment. Restrictions on certain purchases made with your rewards credit card may not qualify for specific rewards programs and therefore do not earn any rewards.