Types of credit reward cards

• Travel reward credit card: These are especially targeted to people who travel often. When you use this particular type of credit card to buy something, you also get rewards points which equate to points with respect to mileage of travel. The credit card company will decide from beforehand the minimum number of points that you need to carry to be eligible for a free travel. These companies usually have a tie up with the airline company and hence are able to get free travel tickets for their esteemed customers. You may prefer to get a travel reward credit card that has a tie up with your favorite airline. Also make sure that the free travel gives you ample time to redeem it otherwise it would be a complete waste.
• Gas reward credit card: If you travel by road frequently then you can get some amazing deals from this type of reward credit card. Every time you swipe your credit card at the billing counter you accumulate points or gas rewards. This enables you to get a free full tank of fuel from specific fuel stations that are pre-decided by the credit card companies.
• Cash reward credit card: This is by far the most popular type of reward credit card. Mostly you are given credit points for every Dollar that you spend using the credit card. There are also credit card companies that bestow two points for every dollar spent by their customers. The credit card points are added to your account that enables you to buy free goodies. Many of the companies also have online stores from where the customers can buy goodies with their accumulated credit card rewards.

Credit card reward programs are offered widely by air carriers, hotels and several shopping centers. It is primarily done to be gain customer loyalty, and you can certainly grab the advantage of using these remarkable credit cards. What could be better than to shop or fly and receive gifts and benefits in the form of reward points, which enhances your purchasing power! However, you need to understand the terms and conditions well, and learn how and when the reward points can be redeemed and used. The key point in using the plastic money is to spend in a way that it turns out to benefit you rather than piling a massive debt on you.

Advantages of travelling with credit cards

• If you plan to travel abroad you must carry your credit card. You must carry credit cards that are widely accepted like Visa or MasterCard. You may also carry two credit cards to be in safe side. If one is damaged, maxed out or lost you can use the other credit card. Most of the companies usually charge 2 to 3% fees for international purchases. This fee is charged to account for currency conversion. You will be relieved to know that the fees charged are less as compared to exchanging dollars or cashing travelers’ cheque.
• Be a smart traveler! You must at all times keep your credit card to yourself and make sure that it is charged in your presence. At times international purchases are blocked due to security reasons. You can always call up the credit card office and ensure that they remove the block. In case you lose your credit card you can call up the 24 x 7 days working customer care that will help you block the card.
• There is a limit of cash that you are allowed to carry. When you carry a credit card you defy any such limit.
• You do not need to worry about carrying wads of cash during your trip. A light plastic credit card can do more than fat wads of cash.
• When you carry cash or travelers cheque there is always a risk than you can fall short of the money. When you carry credit card you do not run the risk of running out of money.
• A credit can also be used to withdraw hard cash during your travel abroad. You must get in touch with the credit card bank to know about the interest rates before withdrawing such amount.
• Credit card comes in use for utmost emergencies.

The most important reason for using credit cards while travelling abroad is that they offer attractive currency exchange rates has zero liability and purchase protection plan. It is the smartest way to travel today, as the credit card is not only a safe mode of transacting while you’re travelling, but also reaps you benefits in form of reward points, when you book your travel tickets, or movie tickets, shop online or at a mortar-brick-shop, even when you book your vacation package.

To grab these awesome benefits you need to compare the various types of credit cards and select the one that best fits your requirements.

This trend is likely to carry right on into 2012 as banks are expected to unveil even bigger and better offers. Experts foresee banks continuing to be aggressive with their rewards offerings. Often times the most coveted of these rewards credit cards are the cash back cards which grant the user a certain percentage of cash back for using the card. Some even award cash back incentives when the cardholder exhibits good financial behavior such as paying their bills on time.

While any cash back may sound like a good deal, some cash back rewards credit cards may be more beneficial to you than others. Here are a few pointers to keep in mind when you are selecting which cash back rewards credit card to submit an application for:

Make Sure The Rewards Suit Your Regular Spending Patters

No matter how sweet the rewards seem, it is never advantageous to run up additional unnecessary debt on a credit card simply to get some cash back. The way to boost the value you’ll receive from a cash back credit card is to earn the maximum allowable percentage of cash back on purchases you would be making anyway.

Some cards offer an across-the-board 1 or 2 percent cash back on all purchases at all times. Others offer higher cash back percentage rates on specific categories of items or at specific retailers, and these usually revolve from month to month. Still others offer bonuses at various points throughout the year, such as an end-of-year 50% cash back bonus on everything you earned back the year prior.

Look for what card best matches your current spending patterns so that you can earn cash back for things you would be buying regardless.

Find Out The Rules Of Redemption

It is also important to consider how easily you will be able to redeem your cash back earnings. Different credit card issuers have different rules when it comes to cashing in on your cash back. For example, with American Express you will need to earn a minimum of 25 rewards dollars in order to redeem them for cash back; with Chase you are required to amass at least 2,000 points before being allowed to redeem; Discover requires that you earn $50 in rewards and then you may redeem them in $50 increments; and Capital One allows you to exchange your rewards points at any time for cash in any amount.

Evaluate The Sign-up Bonus

If, after doing your research and comparing some of the cash back rewards credit cards available, you have found more than one that appeals to you, the sign up bonus may be the deciding factor. One thing to know is this: the bigger the sign up bonus, likely the higher the APR. If you know that you won’t be revolving a balance from month to month, then go ahead and take the most generous sign on bonus you can find.

As always, no matter which credit card you choose be sure that you carefully read every word of the terms and conditions so you know all of the pros as well as all of the cons before opening an account.

Do you really get the way your card’s rewards process works?

Gaining a thorough understanding of how the rewards program of your particular card works will require a little bit of work on your part. Start by visiting the card’s website and reading all of the available information on their rewards program. You can also review your past statements and other literature sent to you by your credit card company through the mail to see if that provides any additional details. Look for whether or not your rewards points have an expiration date – some do and some don’t, depending on the issuer. If you have any additional questions that you can’t find answers to, call up your credit card company and speak with a customer service representative.

If you are able to sit down and do this research prior to applying for a rewards credit card, which is ideal, make sure you take the time to compare the programs different cards have to offer. While some may be similar, no two are exactly alike.

Do you know exactly what your rewards are redeemable for?

You should get into the habit of checking out your rewards balance whenever you review your credit card account and go over your statement to monitor your spending and check for fraudulent activity. Begin to consider rewards as a way to meet your financial goals by identifying things that you would like to cash them in for – for example: a trip, a big ticket item or a gift card. After identifying what you want to “spend” them on, keep an eye on your rewards to monitor your progress as you near your goal.

Are the rewards offered a good fit for your lifestyle?

To ensure that you will utilize all of the rewards points you earn on your credit card, make sure that they are redeemable for goods and services that you already buy and use on a regular basis. Reward perks are not all that useful or helpful if they are for places that are out of your way or for items that you would not typically purchase. Likewise, you don’t want to alter the way you spend simply to rack up rewards.

Do you like what your credit card rewards program is offering you?

If you already have a rewards card and find that you simply don’t have much personal interest in the perks it avails to you, you could apply for a different card or you could use the rewards from the one you currently have to buy gifts for others or donate the items you get in exchange for your points to charity. Many programs offer gift cards as an option which can come in handy around the holidays or for last-minute gifts at other times throughout the year.

If you have a sizeable amount of debt, you should probably not focus on your rewards program until you pay it down and instead concentrate your energy on getting your outstanding balances to zero.

How do you select the best reward credit card for yourself? Well, the first thing to note is that there is a wide array of rewards offered by lenders for consumers that sign up for these specialized cards. Getting to know the different offers will go a long way in helping you choose your card. Many lenders offer some form of cash back for consumers that sign up for their rewards cards. These offers could range anywhere from about 1% to over 20% when consumers shop at certain retailers.

Cash-Back Rewards

Cash-back credit card rewards programs are the most redeemable type of reward since the incentives are redeemed instantly without any complications. Almost all major financial institutions in the United States offer cash-back credit card rewards. It’s important that you take time out to check on various offers in order to select the most attractive one for yourself. However, it’s important that consumers read the detailed terms and conditions that come with any card before they decide to sign up for it.

Point Rewards

Point rewards are another popular type of incentivized credit card programs, and they typically involve awarding a point for a specific amount of money spent by consumers on their cards. For instance, some programs offer a point for every dollar spent. This usually requires a minimum amount of money spent in order to redeem the points acquired from shopping at various locations. Some reward credit card programs also give consumers the chance to redeem their points for gift vouchers and even cash.

Miles Rewards

Miles rewards cards are also popular among consumers as it gives them the chance to get free airline tickets for themselves as well as their friends and family, when they use their credit cards. Each credit card program comes with different mile allocation for every dollar used, so interested consumers can decide which card is their best bet to win their exclusive free airline tickets. Search around for different miles rewards programs, make extensive comparisons and choose the most generous offers available.

No matter which rewards credit card programs you may be interested in, it’s important to make sure you conduct extensive research into the different offers available from different financial institutions so that you only choose the best out there at any point in time.

The problem when you have multiple rewards cards is that it is easy to forget all about your different rewards balances, particularly when they don’t seem very substantial.

Set Goals

Decide what types of rewards are most important to you – travel rewards such as free airline tickets and hotel stays? Cash back? Points you can redeem at your favorite stores online? Once you decide which rewards are most appealing to you and advantageous to your lifestyle, concentrate your spending on that particular card in order to maximize your reward earnings.

Figure out how many points you need to redeem for the item you want and then keep an eye on your account so you can monitor how close you are to reaching your goal. This will help prevent the perks from slipping your mind and expiring before you have the opportunity to cash them in.

Take Advantage Of Special Offers

Often card issuers will extend special offers to their rewards card users in the form of opportunities to earn additional bonus perks in rotating categories at different times throughout the year. If you do a bit of research and planning, you can concentrate on making purchases in those specific areas as they arise.

Stretch Your Rewards

When you are ready to reap the benefits of the rewards you have earned, be sure to shop around in order to find the best deal. Don’t be too hasty about cashing in what you’ve earned. Keep this in mind: the average value of one rewards point is one cent, in other words – 1% cash back. Use that as your guide when evaluating redemption offers.

There are a lot of rewards cards out there that have partnered with major retail chains to give you greater value for your rewards earnings.

Combine Your Earnings

With so many enticing rewards programs being unveiled on a regular basis these days, it’s tempting to sign up for as many different ones as you can to try and take advantage of them all. Instead experts advise that you focus your attentions on one or two different rewards programs and doing what you can to maximize the benefits they are offering. Choose cards with programs that match your spending habits and whose rewards points are easy to redeem. Ultimately a rewards program should not be a hassle or incite you to spend on things you wouldn’t normally buy.

Enlist The Aid Of A Rewards Management Program

If you are determined to hang on to multiple rewards accounts, it might be a wise idea for you to use an online rewards tracking and management program to keep things straight and make sure that you don’t miss out on redeeming any of your heard-earned perks. These sites usually cost something to use, however, so be sure to factor that in when making your decision.

This is why it is important to be mindful when it comes to choosing and using a rewards card. While it may make sense at some point to obtain a rewards card to use for big-ticket purchases, an unexpected setback can prevent you from paying off the balance on the card. As a result, any interest that accrues on the outstanding balance will likely offset much of the value of any rewards you earned – especially because the cards with the best benefits usually have higher-than-average APR’s. Which is why it is wise to think before you charge, especially if you intend to deliberately stack charges onto a rewards card with the intention of capitalizing on the perks.  Here are some other things to bear in mind regarding rewards credit cards:

Read, read, read.

Most people don’t take the time to sit down and really gain a firm understanding of the terms of their credit card account. Rewards cards can potentially be even more confusing than non-rewards cards, because some issuers do things like rotate the types of purchases that are eligible to earn multiple points and others may cap the overall amount of rewards you can earn. In order to use the card to your best advantage, it’s essential to understand exactly how it works.

Also make sure that you have a handle on the redemption policy. Some programs offer bonus perks for waiting to redeem cash back points until they reach a specific amount. Others may have time limits or expiration dates that it is important to be aware of.

Shop around.

In order to maximize your reward point earnings, you typically need to go through the online shopping portal of the credit card to reach retailers. However, be aware that you may not always be getting offered the best price or deal on the item you are looking for by using this method. That is why it is important to comparison shop by searching the web for the product you are looking for because you may very well find it offered at a less expensive price somewhere else.

Likewise, you should be mindful of how you spend your reward points when it comes time to redeem them. It may effectively be cheaper to purchase the item elsewhere than squander a large chunk of your points in order to get it through the rewards program. You will usually always have the option of redeeming your rewards for gift cards, which can come in handy to use as presents.

Don’t spend to earn.

Finally, never overspend in order to meet some sort of goal as outlined by your rewards program because it simply isn’t worth it. Don’t allow bonuses or special promotions to encourage you to make impulsive purchases simply to take advantage of them, because chances are you will regret it later. Rewards programs should provide you with perks and bonuses for sticking to your usual good spending habits, not entice you into cultivating bad ones.

Get exclusive ticket deals to holiday events

Most of the major credit card companies – American Express, MasterCard and Visa – will offer exclusive deals to tickets to seasonal events. Contact your credit card’s customer service line to find out which venues they partner with in your area.

Go out with friends and loved ones

‘Tis the season to spend more in restaurants and out with neighbors and friends. If you are planning more restaurant or time in the bars in December, take a close look at your credit card rewards programs. You may be able to get extra points for using a particular restaurant chain or gift certificates towards eating out. Some credit cards, Discover Card for example, allow cardholders to earn extra point for a month as long as they pre-register in a particular category. So sign up early to make the most of the whole holiday season.

Entertain for the holidays

There aren’t many credit cards that cater to grocery store shopping but that shouldn’t stops you from using your card to buy food and supplies for the holidays. Using your card, even for these staples, will give you an extra month to pay the bill so you can budget to spend a bit extra in the holiday season. Some exceptions of course are if you are already carrying an overdue balance or if using the card to spend on groceries would exceed your credit limit.

Find the right gift at the right price

Often you can double your savings just by using a shopper’s portal or partner retailer. Log in to your credit card’s online portal and visit the rewards or partners page.  Remember to calculate the cost of what you are buying – not just the savings. Your credit card’s shopping portal may not always have the best deal, but it’s worth comparing! For example, MasterCard has an online portal aimed at mothers but available to every card user. The company’s Holiday Rewards portal gives a $20 gift card to any shopper who spends $200.

Traveling to and from your holiday destination

Consider applying for a preferred traveler’s card. Not only can you earn points and miles to your next flight, but traveler’s cards can save you money on rental cars, travel insurance and hotels. Compare the perks of each card and make sure you check that you can use the card on any airline. A good traveler’s card does not have a fee in order to use it.

All those end of the year extras

Hold on the holiday cash for the mailman or your manicurist, car mechanic and other service people that make your life easier throughout the year. A gift card through your credit card company will have the same value for them and be redeemable on points through your credit card company.

Some of the more common situations that may befall you that could lead to some sort of financial fraud when you are travelling include:

• Robbery or theft – because tourists tend to be big targets for thieves.
• The loss of a wallet or purse – because you are distracted by being in a new environment.
• Communication challenges – because it is definitely easier to be scammed by someone if you don’t speak their language and aren’t clear on what is going on.
• Public internet cafes and WIFI hotspots – you should never, ever log on to any sort of banking, credit card or other financial website when using a public computer.
• Card skimming at an ATM – when you are utilizing an ATM machine in a different country it may prove more challenging to notice if it has been tampered with.

While these are all could happen anyone, anywhere at any time, even when you are on your own home turf, the challenges of being away from home tend to exacerbate things such as any language barriers, time changes, unfamiliarity with your surroundings and being in a hurry. Problems can be more difficult to rectify when you are away, especially if you are overseas.

These risks are only slightly elevated when you are travelling, if only because of the added hassle to put things right again. This is why it is smart to always keep a good eye on all wallets, purses, cash and payment cards, and why it makes sense to hide an extra credit card in your luggage someplace in case of an emergency. Also consider keeping a list of the toll free international numbers for all of your credit card issuers on hand should you need to reach them while away.

Before withdrawing money from an ATM overseas – or anywhere, for that matter – give it a good once over and look for anything suspicious such as a layer of plastic film over the PIN pad, components that are crooked or askew, any seemingly extraneous plastic surrounding the card slot or empty screw holes or drill marks that look unusual. ATM skimming devices are becoming more difficult to spot, as thieves get savvier. As a rule of thumb, patronize only ATM’s that are in well-lit, high-traffic areas because that means they tend to present more difficulties for crooks to affix with skimming instruments.

There are several ways to do this that you may not have considered before. To make the most of your rewards now and fast, here are some suggestions:

Sign Up For Several Cards A Year

Because of the competition between credit card issuers being “high stakes” right now, sign-up bonuses can be huge. These bonuses can worth a serious amount of either points or miles (that’s dependent on the particular program).

Even if you decide to cancel after collecting on the rewards, your credit score will suffer minimal damage. Avoid this tactic though if you plan on making a rather big payment on something such as a mortgage.

Share With Friends

Use an online service such as PayPal or Amazon to do this effectively. Through any of them, you can cash in on various rewards. Also, when out with friends or family; use it to your advantage to offer to pay for everything. This way you will be doing a kind gesture as well as earning some rewards points for yourself.

Separate Your Cards

Use different cards for different needs. Rewards can vary from program to program:  there are gas rewards, grocery rewards, travel rewards, etc. Therefore it’s a good judgment call to divide up your cards depending on the program it would be applicable for. If you are the owner of a credit card with an enviable rewards program for any of these categories, your best bet would be to stick to that said category.

Pay With Gift Credit Cards

If you have people that work under you, perhaps consider gifting them with prepaid credit cards, as those from American Express. Maybe even try to pay them with the aforementioned websites, like Venmo, PayPal, etc. By paying them in cash, you aren’t privy to the world of rewards that these websites (or the gift credit card) can offer you.

Or, maybe if you trust someone who works for you enough, lend them your credit card when they are buying their supplies for you. Case in point:  you hire a contractor to work on your house. If you’ve known them to the point you feel comfortable doing so, let them use your card when they go off to get their various goods from the hardware store.

When Online Shopping…

When doing your online shopping, be sure to use what are known as “shopping portals” rather than the direct site. This way, you will be guaranteed to earn reward points on your spending at these places. Do some research beforehand, though, as some of these portals can have costlier items than others and may not be worth the cost involved.

Find Out About Flexible Spending

Sometimes it becomes necessary to spend with a credit card for costs such as medical expenses. If you have to do this, and would like to try and reap in some rewards at the same time, try and use a rewards card. Afterwards, you may be able to go ahead and claim some reimbursement. Because medical costs can be sky-high, this might be beneficial in more ways than one.

By implementing these small changes now and then, you may be opening up the door to a whole world full of credit card rewards you couldn’t have had access to before.