Credit Card Rewards Programs
Earn rewards as you spend! Enjoy benefits like free flights, cashback, gifts and more.
Rewards programs credit cards are the perfect way to get a little extra from your credit card. These cards are tailored to your spending habits whether you enjoy traveling by plane or car, shopping online or staying at fancy resorts, there's a rewards card that will put you on the fast track to free perks and discounts. Find a card that's a perfect match for your lifestyle and your rewards programs card will pay for itself and then some!
Rewards Credit Card Comparison
Everyone thinks that credit card rewards programs are a great deal, but that is only true if you know how to use them. You have to get the right program for your needs and your budget, with rewards that you will actually use. You also have to spend enough to earn points without having to go over your monthly budget.
A credit card rewards program is valuable only if you will actually use your rewards. You might be surprised to learn how many points and frequent flyer miles go unused each year. The reason, is many consumers do not understand how to earn enough points or how to use them effectively. If you, as a consumer, can figure out some tricks to using your points you will be able to benefit from your credit card in a very big way.
What Can I Spend my Credit Card Points on?
Each reward scheme will have a set of promotions that run alongside their card. Some cards will offer flights and air travel, whilst other will concentrate on rewards like retail store vouchers, or experience days. Some lenders will run reward schemes that offer a whole range of rewards, in fact some schemes actually have their own official members store where customers can redeem their points.
Earning Points
The thing to be acutely aware of is that earning points costs money. You have to spend money to earn points, so if you are overspending just to earn points you are likely not getting much value from your credit card. The value of your points is really almost nothing, most cards require you to spend at least $1,000 each month to earn enough points to buy anything. If you spend less then that and you are paying some of the high fees associated with rewards programs, like annual fees you are actually losing money. Instead, you might consider a low fee or low interest card which will reward you with a reduction in costs.
Each gift or item in the store will have a different points value, and you will obviously will only be able to spend up to the value of the points you have amassed.
Another point about overspending to earn points is that the value of them is almost always cancelled out by interest fees. Even if you are piling up loads of points if you are spending money on interest each month the value of that far outweighs the value of your points. The best way to make the most of your points is to spend as much as you can on your card and pay off that debt in full each month. This way you are maximising the amount of points you earn without spending any extra money on interest.
Also, read all of the fine print associated with your card. In almost all cases cash advances and balance transfers are not eligible for points. If you are going to do a balance transfer look for the one that offers you the lowest interest rates and a term that is reasonable for your debt. A rewards card is usually not ideal for this because you will need to pay off the balance transfer in full before you can start making purchases on your card. If you make purchases they will be subject to an allocation of payments clause which means that no payments will be applied to those debts until after your balance transfer, which has a lower interest rate, is cleared.
Understanding How Points Work
To start you have to understand exactly how credit card points work. Points are based on spending, the more you are spend on your card the more points you are able to earn. Further, if you have a more expensive card, like something in the Platinum level it is likely that you will earn more points for each dollar spent. If you really want to earn a lot of points it is important for you to get a card that offers the most points for each dollar.
After you have earned your points the next step is to figure out how those points will be redeemed. A lot of people do not redeem their points because the card company does not offer them anything that they really want, so they just waste them. Instead of wasting points, you should make sure that you choose a card that gives you something you will use whether it is frequent flyer miles, cash, merchandise, or charitable donations.
Travel Rewards - Using your points towards travel has become increasingly popular. People like to travel, but it is expensive so saving money on airline tickets is an excellent way to put your points to work. It can get tricky though because most cards are affiliated with a specific airline. You must make sure that the card you choose is affiliated with an airline that goes to places you would like to visit. Sometimes you can use your points to gain access to exclusive airport lounges or for other products sold by the airlines. If your card is through an airline you can earn extra points by using it when you book with them, so be sure to take advantage of those opportunities.
Airline miles- For those who travel often airline miles can be a great deal. Just be sure that the miles are redeemable on airlines that you like and to destinations that you frequent.
Cashback - Nothing really beats cash. You can always use it and it never expires. Although the return is low, just 1% of the amount you spend it is a sure bet that it will not go to waste. Depending on your card cashback is offered as a yearly or quarterly cheque or is applied to your account. Some card issuers will allow you to use your cashback to pay your annual fee, which can greatly reduce the cost of owning a credit card.
Purchases-Points can be redeemed for retail purchases often at an online store operated by the credit card company. Sometimes you can also earn points at specific stores and then redeem them there at a discount.
Merchandise - Shopping with your points can be done in a variety of ways. Some card companies have online stores that you can use your points as payments, some will issue vouchers for you to shop at specific outlets. Others will give you a discount for shopping with their partners and using your cards. In many of these cases shopping with your card company partners is also a good way to earn extra bonus points.
Charities - This is one of the newest ways to use your points. Instead of getting cashback you can choose to have an a percentage of the amount you spend sent to a charitable organisation. Just be aware that your choices of organisations is usually limited to just a few that are affiliated with your card issuer.
All of these are great options, but the key is to use your points. Have a plan for them, do not allow them just to sit and gather dust. If you do not use your points they have no value, but if you use them they can be an excellent investment.
Choosing A Rewards Card
Not all rewards cards are equal. There are variations based on how much you spend and what kind of rewards you want. You should try to find a card that offers points with no expiration date, that way if you only spend on your card a little bit each year you can still eventually earn rewards. If at all possible find a card that also has no cap on the number of points you can earn, that way you can save up to finance an overseas flight or an expensive piece of merchandise.
Spending Less Then $15,000 - If you spend this small amount on your card each year your options are limited. However there are a few cards like the Citibank Silver which has an annual fee of $89 and an interest rate of 20.74%. It offers one point for each dollar spent with no expiry on the points. Another good option is the St.George Amplify which gives customers double points through June and a regular rate of one point for each dollar. St.George allows you to choose the Qantas Frequent Flyer option at a rate of one frequent flyer point for each dollar spent.
Spending Less The $25,000 - At this amount you have reached what most people consider the minimum for getting the most benefit from a frequent flyer program. But, in order to be approved for one of the best cards in this bracket you will need to earn at least $50,000 per year. One of the best choices is the American Express Gold Ascnet Card. With this card there is no annual fee and points are earned at one for every two dollar spend. You can opt to pay an annual fee of $80 and your points will be earned on a one for one dollar basis. The Citibank Gold card also earns points at one for each dollar spent with an annual fee of $149. The points have no expiry and the card comes with complimentary travel insurance, purchase cover, and fraud protection.
Spending At Least $60,000 - Those who spend amounts in this level have great rewards available to them. For this amount you can earn more then $500 in rewards, just keep in mind that they also come with a hefty price tag. However, that price includes the rewards program as well as lots of other benefits and perks not available to lower spending customers. Top on the list of these prestigious cards is the American Express Qantas Premium card. It carries an annual fee of $249, but offers 1.25 points for every dollar spent. Cardholders also have the chance to earn up to 7,500 points after the application is approved.
If you are looking to earn big rewards there are plenty of cards out there that can meet your needs. Before you jump on the first offer that you see do some research to find out all of the details of your chosen rewards program. If it does not offer points at a level that will work for your budget then it is not the right program for you. Once you have found the right program set your mind on earning as many points possible without going over your budget. Lastly, choose a program that allows you to redeem points for things you really want. If it is travel, make sure they use airlines with destinations that intrigue you. If it is shopping be sure there are stores and items that you like. If it is charity, be sure the cause is something you believe in and can feel comfortable donating to. The options are endless and the choice is yours. Making the right one is an important step to rewarding yourself.
