Choose the Best Rewards Credit Card with These Helpful Tips!
Choosing the right credit card can be quite tricky, especially if you are interested in rewards. If you happen to be looking for a good rewards credit card, here are some of the things you need to keep in mind before investing in one.
Types of Rewards Credit Cards
There are quite a few types of credit cards that offer rewards. These include cashback cards, travel rewards cards, points rewards cards, and more.
Cashback Cards: Cashback cards are the most popular as they allow you to earn back a flat percentage of your expenditure back. On average, you can expect anything between 2-5% of your expenses being awarded back as cashback. While some credit card companies directly deposit the money into your bank account, others let you use the earned credit at select stores.
Airlines Cards: If you are a frequent flyer, airlines reward credit cards can come in very handy. In some cases, you may also get free upgrades along with flight credit and instant cashback rewards on flight bookings. Even though your credit card rewards are restricted to flight tickets only, you do get a better percentage back on your expenditure compared to cashback cards.
Hotel Rewards: If you check-in to hotels quite frequently due to work or personal reasons, hotel rewards credit cards help you earn premium rewards. You can get cash back offers, free accommodation, and even free hotel room upgrades depending on your credit score.
Eligibility for A Good Rewards Credit Card
Good Credit Score: You cannot expect to register for a premium rewards credit card without excellent credit scores. If you pay your bills in time and have a good track record, you can get some of the best cards out there.
Frequent Credit Card Usage: Better rewards are offered to only those who use their credit cards frequently. Every dollar you spend counts so you should consider using your card more frequently.
Loyalty: If you are loyal to a particular hotel or airline, you will have an easier time earning rewards card backs. For example, if your credit card provider is partnered with Hilton and you stay in their hotels often, you can expect an easier time applying and receiving a rewards card.
Choosing the Best Rewards Credit Cards
Cashback or Travel: You need to determine if a cashback card is more valuable to you or a travel rewards card. In general, travel cards are much better if you stay in hotels or take flights very frequently as the percentage of cashback is much higher. However, if you want your rewards to be more flexible, cashback cards are ideal for you.
Earning Rewards: You do not want to invest in a card that offers great rewards but a tiresome earning process. The best cards have the right balance of earning requirements and rewards. The last thing you want is a card that allows you to have the best rewards but no realistic way of earning them in a short time.
Redemption: Good rewards credit cards should allow you to redeem your rewards in a variety of partner locations or even earn direct cashback to your bank account.
Annual Fees: Some rewards programs may have hefty annual fees that may be too much to bear compared to the rewards on offer. You should keep an eye out for all hidden terms and conditions to ensure you are getting good enough rewards compared to the amount you invest.
Sign-Up Bonuses: A number of credit card providers offer a number of sign-up bonuses to give you a head start at earning rewards right from the time you sign up for a card.
Foreign transaction fees: If you sign up for certain rewards credit cards, you may be charged for purchases you make overseas. There are also certain rewards credit cards there are not accepted in every place outside the United States. So, if you want to save a few dollars and you are searching for a rewards credit card that is widely accepted abroad, take these factors into consideration when choosing the best rewards credit card.
Changing terms: Credit card issuers tend to change their terms every once in a while, and they usually notify cardholders of the changing terms. If possible, search for credit card issuers who do not perform any term changes; read as much as you can about the terms offered by rewards credit card issuers, and check for users' reviews about these issuers.
When you decide on a credit card issuer, do not ignore the mail and emails they send you. Read the notices you get to find out if your rewards credit card issuer has changed their policy. If the changes affect you negatively, you can switch to other issuers, and get a rewards credit card that best suits your needs.
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