Understanding The Schemes Of The Rewards Credit Card

Not all credit cards that offer reward programs are perfect

. Regardless of how exciting the rewards seem to be, it will only work if the reward system fits well with your way of life. For this reason, being familiar with the reward program is an important step that must never be disregarded.

How Credit Cards Give Rewards

Typically, a one dollar purchase will be equivalent to one point. As you charge purchases to your reward credit card, you continue to accumulate points until you collect sufficient number of points for redemption. The number of points required will vary depending on the type of reward (gas rebate, cash back, airline miles, etc.) offered.

Nonetheless, there are reward credit cards that only give point on eligible purchases. What does that mean? What will be considered as an "eligible" purchase would depend on the terms of the reward program.

For example, qualifying purchases could be ones that have been made from affiliated retailers. Therefore, you might not be able to get points on all your credit card purchases. To be able to get reward points, you need to follow your Issuers terms and conditions.

A number of credit cards offer bigger rewards than others, especially credit cards that are sponsored by leading companies in the market. Then again, you might want to take into consideration how the rules of the reward program match with your spending style. Think about it, do you usually purchase products from merchants that are affiliated with your chosen reward credit card?

Study the list of affiliated merchants as most names included in the list might be high-end boutiques that sell products at higher prices. Certainly, if you need to buy from an expensive store just to collect points, you might end up spending even more than the value of rewards you can get. In that case, wouldnt it defeat your purpose for getting a reward credit card?

Analyze the Fine Print

The fact remains that many people who are looking for credit cards do not bother to study what the fine print says. They simply choose a card, sign up and submit the application. True enough, the Agreement page can be very lengthy and written in very tiny letters to dissuade people from reading all the details.

However, regardless of how appealing the reward program is, the only way you can be certain that you have made the right reward credit card choice, is by spending time examining the Terms and Conditions of the Issuer. Be aware that there could be hidden costs or unreasonable rules that are not specified in the advertisements.

As you can expect, the unpleasant details will not be advertised for people to see. It is up to you to find out the weak points about a credit card by doing your own research. If you think you have found the reward credit card that matches your needs, familiarize yourself with the rules of the reward system and plan your own strategy to enjoy the best benefits that you can get.

by: Ashley Jane Summers

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