7 ways to get the most from rewards credit cards - PowerPoint PPT Presentation

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7 ways to get the most from rewards credit cards

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With all credit card rewards programs available, the issue is not whether you should get a rewards card, but what type of rewards card is best for you. But it's a confusing marketplace, with cards touting cash back, points or miles and other incentives to get your business. – PowerPoint PPT presentation

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Title: 7 ways to get the most from rewards credit cards


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7 ways to get the most from rewards credit cards
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With all credit card rewards programs available,
the issue is not whether you should get a rewards
card, but what type of rewards card is best for
you. But it's a confusing marketplace, with cards
touting cash back, points or miles and other
incentives to get your business.
"When considering a rewards card, the most
important issue is to put some thought into it,"
says Scott Crawford, co-founder and vice
president of product and marketing at Ascend
Consumer Finance. "You can look at something
online or get an application in the mail that
seems like the best thing ever, but if it doesn't
fit what you're interested in, then it just won't
work for you. Like if you have an airline miles
card, but if you don't fly much, that isn't a
really good deal."
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1. Align rewards with your interests.
Reward card programs come in many different forms
-- generally allowing you to accumulate points
toward merchandise, gift cards, travel miles or
points or cash back -- so it makes sense to align
rewards with your interests and goals. If you're
hunkering down and trying to budget your income
better, you might choose a card that offers cash
back toward such basics as shopping at your
favorite grocery store or filling your gas tank.
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2. Cash back is king.
Cash-back rewards cards give you the most basic
currency available -- cash -- to spend as you
like. According to a 2015 CreditCards.com survey,
cash-back rewards are nearly three times more
popular than airline rewards or hotel rewards
programs. The cash can be applied toward your
balance or can be redeemed for purchases, or can
even be mailed to you by check.
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3. Compare the reward offer with others.
A major mistake many consumers make is to add a
credit card to their wallet on impulse, says
Crawford. "I used to work in credit card
marketing, and it's amazing how little thought
people put into getting a credit card offer. I
would say that most credit card decisions tend to
be made on impulse."
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4. Dump less rewarding cards.
If you're carrying several rewards cards, you may
be diluting the value of your rewards by rotating
charges across them all instead of focusing all
your spending on one card that rewards you the
most. Cards with annual fees and higher interest
rates should be evaluated carefully to see if
they are worth keeping. If you are going to add a
new rewards card and dumping others, do the
dumping carefully so as to not negatively impact
your credit score.
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5. Run your spending through one card.
Once youve narrowed down the number of cards
youre using,, try to put as much as your
spending on that card as possible to maximize the
rewards program value. It's not going to do you
much good to have a great rewards card if you
don't use it. Of course, you don't want to spend
money you don't have just to get rewards, but if
you typically do put certain expenses on your
card, put those on the rewards card first.
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6. Know when your rewards points expire.
Be sure to check the fine print in your credit
card agreement or on the reward card's website to
see when your particular rewards expire. "Typical
reward expiration is 12 to 18 months, with some
going out as long as 24 months," says Roger
Brooks, senior vice president of business
development at Zipline Payments. "Sometimes you
can buy your points back after they expire, but
it's best to use them before the expiration date.
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7. Keep track of changes in terms.
Credit card issuers are notorious for changing
terms. When they do so, they have to notify you,
but the problem is, you're not likely to even
read what they send, since it generally comes in
the form of a dense snail mail notice in fine
print. However, a change in rewards terms, such
as getting fewer points or a lower percentage of
cash back, is something that will typically be
disclosed in such a notice, so you need to take a
minute to examine the notices your card company
is sending you.
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