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Credit card holders who fail to pay their bills in full are penalized by way of being charged interest fees. In contrast, loyal customers get a reward for every dollar they spend on their card in the form of cash incentives or merchandise items from banks, gas stations, or retail shops, amongst others. This is what rebate credit cards are made for.
Also called cash back or rewards cards, these handy slices of plastic benefit both consumers and credit companies alike. For consumers, getting rebates on their purchases means more money will go to their pocket. Most of these cards offer rebates to customers who have spent at least $ 1,000 using their cashback-card. For credit providers, cash-backs help in getting more customers and encouraging them to use their cards more often.
On the surface, rebate cards seem like a great idea. But picking the wrong one will cost you more over time. It pays to conduct an extensive research on your various options before you choose the rebate card that suits you and your needs best.
When applying for a certain rebate credit card, it is of the utmost importance that you read the terms and conditions of the card issuer so that you get an absolutely clear idea of the rewards structure it offers, and what to expect if you breach the agreed terms. Some cards offer high rebates for the first few months after the approval of the card. There are gas stations, grocery stores, and banks that provide higher rewards for daily purchases charged to the rebate card.
Most rebate cards put a limit on the total points you can earn every year. If you think you will exceed that limit, it is best to opt for a card that has no limit on total earnings. You may also get more than one rebate card.
Once you have a rebate credit card, make sure that you pay your entire balance every month. Your rebates will be useless if you shell out more money for paying the interests on your remaining balance. In addition, some cash back credit cards do not provide reward for cardholders that carry a balance each month. If keeping a balance on your card is unavoidable, it is recommended that you opt for a rebate card with a low interest rate.
If you will use your credit card frequently, it is wise to avail of special features that will be useful to you. However, if these features are not ideal for your occasional card spending, the smarter choice would be a rebate credit account that provide rewards for lower level spending.
Also, you need to understand what rebate cards mean when they advertise rewards up to a certain percentage. For example, if a rebate credit card promises a cash incentive of up to 5%, that means you get less than that percentage unless you spend a lot using your card.
It is important to check if the rewards offered by a rebate credit account holders are worth the annual fee. For example, you might need to spend $ 3,000 before earning any point if your annual fee is $ 30. That will be advantageous only if you are a frequent credit card user.
Rebate credit cards can provide you with real benefits if you study them carefully before signing up for one. In particular, they are ideal for those who use their cards often for larger purchases or high-end items.