The Best Method:
Reward credit cards allow you to
benefit in numerous ways. Although they tend to have higher
rates than standard (non-reward) credit cards, consider
the types of bonuses
you can earn with reward credit cards and how they can
offset higher interest charges. If you're able to payoff
your balances in full each month (or before the Grace
Period ends), reward credit cards could be a great way
to earn extra cash or other bonuses without paying the
additional charges.
The best way to take advantage
of this situation, is to use reward credit cards only
as a secondary option for SHORT-TERM charges. Since you
may have a higher APR with one of these offers, use a
lower rate credit card
for your LONG-TERM purchases to avoid the extra interest
charges. If you know you can pay off purchases quickly,
use your reward credit card instead and earn a bonus!
Just make sure you pay off your balance before too much
interest accumulates. This could negate any benefit you
gained from using this card in the first place.
Ways to Earn More:
Now that you're using reward credit
cards to your advantage, here are some other ways to benefit
and maximize your earnings:
- Stick with the credit card
company's products and services. Sometimes you can
save money or earn extra bonuses for your loyalty.
- Use the credit card company's
partners. Since many reward offers provide increased
bonuses for shopping at -or- using specific merchants,
determine where you can get the most rewards and use
these locations to maximize your earnings.
- Take advantage of sign-up
bonuses or special introductory offers. Many times,
credit card companies will give you extra bonus points
for signing up -or- increased reward percentages for
an introductory period after you apply. Take advantage!
- Pay for everyday purchases
with your reward credit card. As long as you remain
100% dedicated to paying your bill in full each month,
you can earn rewards on a regular basis from your normal,
everyday spending habits. Gas, groceries, drug store
purchases, even utilities and mortgage payments can
all be charged to your credit card.
- Have credit cards for all
members of the family to use. Although you may want
to be cautious with certain members of the family (wink
wink), allowing them to make purchases you intend to
pay for anyway will allow you to build more points.
Words of Advice:
Don't fall into the hands of the
credit card companies! Don't misuse your reward credit
card and create a large debt you can't handle. Since interest
rates are normally higher with these offers, you'll be
paying more if you carry a balance with a reward credit
card vs. a standard credit card (even with all the incentives).
Pay off your balances quickly and avoid these additional
costs!
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