5 Factors To Take Into Account When Comparing Rewards Credit Cards

In a recent survey, only 6% of Australians said they bothered to check out a credit

card comparison site before making a credit card application and around 50% only applied to their own bank.

When researching a rewards credit card, it is vital that you shop around to find the best credit card for you. Here are our top five factors to take into account when choosing a credit card rewards program.

1. How many points you earn

Every single credit card rewards program in Australia works differently. The amount of points that you earn varies significantly from provider to provider. Some award one point per dollar spent, whilst others offer enhanced points collection for using a certain type of credit card.

Dont be fooled into thinking that the higher the points offered per dollar spent, the better the scheme. If you were offered two points per dollar spent, but you had to redeem three times as many points for the same reward, youd actually be worse off through this scheme.

Compare the points earning potential to the number of points required for a certain reward. For example, see how many points you would need for a $50 shopping gift card, and work out what you would have to spend on the card to earn these points.

2. The annual fee

Most rewards credit cards charge an annual fee of between $25 and over $200. A card with a low fee might seem preferable, but it may offer less points per dollar spent. The more generous schemes may have higher annual fees. Make sure you take any annual fee into account before choosing a credit card rewards program.

3. Would a Gold or Platinum card be better?

There are many gold and platinum cards affiliated to credit card rewards schemes. Often, you earn more points per dollar spent by using a gold or platinum card. However, the annual fees for these cards are generally higher.

If you use your card on a regular basis, you may find it is beneficial for you to pay a higher annual fee in order to benefit from an enhanced number of credit card rewards for your spending. You will also benefit from many other advantages with a gold or platinum card including enhanced service and free insurances.

4. How to earn bonus points

Many credit card rewards programs offer bonus points to customers. This may be in the form of an initial points credit the first time you use your card, or by offering a range of bonus partners; businesses through whom you can earn additional points.

Research how you go about earning bonus points. If a card provider offers additional points through a company that you use often, this could help you accumulate credit card rewards more quickly.

5. Choice of rewards

Every credit card rewards program offers a different range of rewards. These range from flights, gifts, homewares, electrical equipment and experiences. Before you choose a rewards card, head online and research the range of options available through a particular credit card rewards program. Choose the scheme with the rewards that suit you.

by: Jack Smiths

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