Credit card rewards often attract customers. However, a lot of credit card rewards
are not at all rewarding to say the least. They are mere marketing strategies to make customers spend even more. This is why credit card holders should look closely at the rewards before taking a call on whether to accept the offer or not.
Loyalty points for select merchants and less options for purchase
If you have 100 dollars worth of loyalty points but you can only spend them at select merchant stores on select merchandise, the reward is absolutely of no use. A lot of credit cards
permit you to redeem your points on merchandise like fancy items, apparel stores you don't prefer or at book stores and gift centers. Only few people can actually make use of those points and a lot of people just let those points be, as their time and the additional money they need to spend are worth more than the loyalty points they are being rewarded apparently.
Travel discounts for non travelling card holders
Your credit card might be offering you 1 airline mile for every dollar you spend on your credit card. But if you are someone who doesn't travel often or who needs to travel only once or twice a year, these travel rewards along with the travel insurance and other benefits are not your piece of cake. It is better to choose some other credit card whose rewards prove more useful to you, than just sound attractive without saving you a penny.
Minimum expense rewards
These rewards are more like a punishment because they dangle the bait in front of the credit card customer, without really offering him or her anything of worth. A good example is the discount offer of 25% on items you bought with your credit card. This can be good and attractive, but what if the discount kicks in only after you have shopped for more than 500 dollars. A lot of people fail to realize that this discount is not rewarding and is actually making them spend more, when they don't intend to running into unnecessary outstanding balances and debts.
Rewards that expire soon
You might have 100 dollars worth of reward points on your credit card. But if you cannot wait beyond the month to spend them, you are not likely to buy anything that you actually need and just end up buying something to redeem those points. In fact, all your expenses which helped you get those reward points went into a lost cause, especially if some of them were purely to get the reward points.
Rewards on High fees credit cards
If you have a cash back credit card
which has a limit of 100 dollars per year, and your credit card levies an annual fee of 100 dollars, you are effectively gaining nothing. In some other cases, the fees on your card, starting from initial fees, to annual, late, balance transfer
and over draft fees could all sum up to exceed the value of your rewards.