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There are a number of reward credit cards available and if you use them the right way, you can end up with quite a few benefits. The trick is to work with them to get the most out of each particular reward.
Choosing Your Rewards Credit Card
The first thing to do is look at what is available and what your goals are. If you've been wanting to take a vacation to Paris but haven`t been able to justify the cost of tickets, then an air miles card might be a good idea. However, if your main goal is to make your daily life a little easier, look into rewards that let you get cash back, earn gas dollars or reward points that can be redeemed for prizes.
The next consideration is just how long it will take you to earn the reward. For example, if you get 1 point for every $ 100 spent on the credit card and you need 200,000 points … it's going to take you an awfully long time to reach that goal.
Don`t jump at the first rewards card that you see, chances are there's a better one out there, so take the time to compare various cards and companies. In cash back rewards, for example, there are often very different rates between card companies, ranging from 1-5%. Also, you want a card without an annual fee since this will basically annul any rewards you earn.
Use Different Cards for Different Goals
Let`s say you really want to take the kids to Disneyland, but you`d also like to take a little off your Starbucks obsession. You can use two different credit cards for this. For the air miles or travel rewards card, use it on your largest purchases, like when you get a new sofa or have your car repaired. Smaller purchases, like topping off with gas or picking up some milk, can be put on the other card, since you`ll get to your smaller goal faster anyway. This gives you more immediate rewards while still saving toward the big goal. Keep in mind, however, that having more than two credit cards will not only make it more difficult to keep track of your spending, it will also spread the points out too much for them to do you much good.
Watch the Expiration Dates
Most reward points will have an expiration date, so make sure you keep track of it. There's no point in using the card for all that time and then losing everything you've worked towards. While you shouldn't be making any purchases based purely on the fact that you will get a few extra points, if you`re thinking about making a large purchase with your credit card, you might want to do so before the points expire so you can take full advantage of them.
You`ll get the best results if you take the time to research which card is going to perform best for you. It`s worth comparing since you can earn some great rewards.