The idea of earning rewards for spending money would have been a crazy thought just a few short decades ago, but now it seems like nearly every single kind of credit card has some kind of benefit, points, or reward system for your spending habits. This allows you to rack up some bonuses when you are already spending money.
You can earn points or rewards in many different ways. It could be for air travel or redeemable for a cash-value system. Whatever it is, there are a lot of cool things that your credit card can do for you. The idea of letting your card work for you is not new, but it, letting people enjoy some rewards for their use.
If you have a points-earning card or are looking for one and need some help figuring out how to best maximize the benefits, check out these tips to help you out.
Find Cards With Useful Points to Earn
Not all points or rewards that these cards offer are going to be good. Some are great for everyday uses like groceries, but you want something that isn’t just a singular use. That is why an ultimate rewards credit card is so popular because it offers more points, therefore, offers more value. Not only that, but it could have a great ratio of points per dollar spent, with most cards being 1 point = $1.
Nearly every credit card company or bank offers a points-reward type card. You can get air miles, grocery rebates, gas rebates, general multi-use points, and in 2021 you can even get a Bitcoin reward card that works like a cashback card. There are a lot of options out there, so it can be tricky to pick the right one, but you want to make sure that the points you are earning are actually going to help you.
Use Them For Big Purchases
A good idea for getting the most out of your points-earning card is to use it for those big purchases. You probably already use your credit card for big purchases, like electronics, bills, etc. but you can really help yourself earn more points if you are doing that with a reward card. If every $1 spent = 1 point, then a big purchase of $1000 would equal 1000 points and help you get closer to, say, a dream vacation. Remember that these points aren’t free, and credit still needs to be paid back, so don’t go overboard making purchases you can’t afford just to earn some cool rewards.
Use Them Often
Some people rarely use their credit cards because they don’t want to rack up debt. This is a good solution for being safe with your money, but doing that also limits how many points you can earn with your card. If you use your bank/debit card to purchase everyday items, think about switching over to your credit card to start taking advantage of the total amount of points you can possibly earn. Groceries are a weekly purchase, and usually so is gas, so these can help account for a lot of points each week without you even realizing it. Another good idea is to make sure your bills (utilities, rent, cellphone, car insurance, etc.) are going through this card to get points without you having to even use the card, so to speak.
Know What Purchases Give You Rewards
It is also important to point out that not every purchase you make is going to help you earn those coveted points. There are a lot of retailers that will not be recognized by your credit card as a source of rewards for the card. The necessities like gas or groceries will definitely be one (although not all stores will help), but more niche items probably won’t be. Check the fine print of the rewards points agreement to see what they say and what counts towards rewards. You don’t want to be going out spending money on a lot of things only to find out that you don’t get anything for it.
Keep the Balance Low and Pay It Off Quickly
Always being late with your payments on your balance or carrying a balance will be bad news for your points earning potential. Not only will it increase your interest rate, which makes it even harder to spend money, but it will also pretty much erase any progress you made on accumulating those points. Be careful with your credit cards and ensure that you are either carrying a low balance, or you are making payments promptly.
Have Multiple Cards
Utilizing multiple cards and rewards is not only smart, but it’s also encouraged. It might seem like contradictory information to have multiple cards but for people who are responsible with their credit, this can help their score. In this case, you can take advantage of multiple offers from multiple different credit card companies to get a significant amount of points-earning potential. If one card intrigued you for its points earned for air miles, the other one might be able to get you better points rewards for everyday purchases like groceries or gas. Having a few cards is good, just remember that the same principles of owning a credit card apply, and then some, when you have multiple credit cards.
Take Advantage of Welcome Bonuses
There’s no love lost when you switch to a new rewards card. Big credit card companies won’t feel an emotional attachment, and neither should you. You can find some pretty incredible welcome bonuses for new points-earning cards from other companies. Instead of spending years with the same card trying to earn 20 000 points, switch to a new card that offers you 25 000 to sign up, which usually means spending a certain amount within the first few months. This saves you time and money on purchases.
Earning points from your credit card purchases can be a great way to earn some valuable rewards. People have ended up paying for entire trips just through the points they accumulated over the years. With these tips, you can maximize your points-earnings and possibly end up being one of those people too.
