There are times when a credit card is more than what it appears on the surface. This is typically the case with a points reward credit card, as you are getting something in return for every dollar you spend.
Before you choose just any points reward credit card, here is something to remember: every credit card company offers several options. So it’s essential to compare the finer details, benefits, and drawbacks of each one.
With the ability to earn reward points for card purchases, you will feel more inclined to use your plastic every chance you get. As long as you are comfortable with how much you are spending, and you can afford your purchases, there is nothing wrong with using your card and paying in full each month.
What do you Get?
The best way to decide for or against a points reward credit card is to understand what you are getting in exchange for purchases.
Here are five things to keep in mind:
1. Earn points for every purchase.
If nothing else, you want to understand that you can earn a point for every dollar you spend. It allows you to collect points with each purchase, eventually redeeming them for something that piques your interest.
2. The option to earn more than one point for each dollar spent.
These two points for every dollar on certain purchases may not be something you are expecting, but it could work in your favor if you choose the right offer.
For example, some points reward credit cards give you double points for every dollar you spend on gas, groceries, or restaurant purchases.
3. Special bonus offer.
How would you like to receive something special just for signing up for a points reward credit card? Keep an eye out for these offers as you compare your options.
For instance, there are points reward credit cards that give you 50,000 free points if you spend a minimum amount of money during the first three months after opening an account. Yes, this is an incentive to use your credit card. But as long as you were going to do so anyway, you might as well collect the points.
4. Know what you can get for your points.
It is not good enough to collect points, month after month. You need to understand what the points can be used for, as this will give you more reason to continuing using the card.
Most people enjoy points reward credit cards that allow them to cash in points for travel perks. These perks can include but are not limited to air travel, hotel stays, rental cars, and more.
5. The fine print.
Just the same as any credit card, there are the details in the fine print. When will your points expire? Are there blackout dates? Can you transfer your points? These are the types of questions to answer. Not only can you ask directly, but you can typically find information in the fine print.
Tip: don’t sign up for a points reward credit card until you are 100 percent sure that you understand what you are getting.
Are there Fees?
There are reward credit cards that have no annual fee. If you don’t want to pay for access to a particular offer, then look for this type of no-fee reward card.
There are also others with an annual fee, and here is what you need to consider: you may get more out of your credit card if you are paying a fee once per year.
As long as you understand the annual fee and when it needs to be paid, you will never be surprised.
There are other fees associated with most credit cards, such as those for late payment or making a balance transfer. You should fully understand these fees, as to avoid an unwelcome surprise down the line.
How to Compare Points Reward Credit Cards
It’s a common belief that most points reward credit cards are the same, but as you dig more in-depth, you will find out that this is not true.
Use these three tips to compare offers:
Focus on the reward program details, as this is the main attraction of each credit card.
Don’t overlook any downfalls, such as a high-interest rate or costly annual fee. If you are not paying the card in full each month, the reward might not be worth the high interest and annual fee you will pay.
Use the internet, as this can give you a side by side comparison of what each credit card has to offer.
Points reward credit cards are more popular today than ever before. A growing number of consumers have come to realize that they might as well get something in return for using their credit card.
With so many points reward credit cards to choose from, you should be able to find one that suits your personal approach to shopping as well as your financial situation. Make sure you compare many offers before applying.
Our Top Recommendations
Capital One Venture Rewards Credit Card
One of the awesome perks of the Capital One Venture Rewards Credit Card is letting cardholders earn 2x miles on every purchase, every day. If you spend $20,000 on purchases in the first year from your account opening, you can earn 100,000 bonus miles. You can also obtain 50,000 bonus miles when you spend $3,000 on purchases in the first 3 months.
American Express® Gold Card
If you own an American Express® Gold Card, you can earn as much as 60,000 Membership Rewards® Points when you spend $4,000 with your card within the first 6 months of account opening. You can also earn 4x Membership Rewards® points at local supermarkets or on restaurants worldwide as well as when you buy via Uber Eats.
Other Types of Credit Cards
Interested in other types of credit cards? Check out these links for more information.