Most often, people tend to get engrossed in choosing the credit card with the lowest interest rates as well as other fees. These factors are of prime concern, especially if one maintains a steady balance on their credit cards. However, if one has the habit of paying the monthly bills in full every month, then one would prefer a card that carries no annual fee. But that is just one aspect; always one must ensure there are other features on the credit card as well and find the best credit card offers.
Today’s reward cards come with many complex calculations that would help determine the payback that one could expect. The more simple ones would send a check once a year based on the amount charged per year. Other credit cards might use the point system, where the points can be redeemed for merchandise, and while others may offer air miles that could be spent on travel related expenses.
Cards and reward programs are getting more and more innovative, as the market is very competitive. Some of the programs might be a little hard to comprehend. The more recent trend is to allow cardholders to determine how to receive the rebates – which is if they would prefer cash back, points, air miles or gift certificates.
Rewards cards generally tend to charge higher APR’s than the regular credit cards. Even those that charge the lowest APR’s tend to charge at least about 1% more than their standard counterparts with some of the best rates. Especially so, if one has to carry forward a balance then, the cash back reward gets negated. Hence, these are cards only for those who clear their monthly balances in full.
Most credit cards offer generous cash-back while making purchases at supermarkets, gas stations or drug stores. So it would make sense to calculate where one could get the best offers depending on the amount spent. Credit cards that pay cash-back at the highest rates might have caps or restrictions that could result in a lower rebate annually than a more straightforward 1% cash-back.
Credit cards that offer a 5% cash-back will cut back on other options. For example, a credit card which offers a 5% cash-back at gas stations or auto maintenance, will only apply this discount to the initial $1,200 spent in this category. Sometimes the 5% cash-back is only available on purchases made in designated categories, and might change at least four times a year and shopping at warehouses or discount stores would get back maybe around 0.25% as cash-back.