The fundamentals of credit card rewards

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Credit Card Applications » Research » Guides » Travel with Credit Cards » The fundamentals of credit card rewards

The fundamentals of credit card rewards


Updated: December 26, 2012

The content is accurate at the time of publication and is subject to change.
Choosing a single credit card is an overwhelming task, since the choices of credit cards that are available today are abundant. This task is slightly simplified by various reward schemes that the credit card companies offer to increase their customer base. Credit card rewards pay the customer for spending using their credit cards. It may be in the form of reward points that may be redeemed later for cash, or free air travel, or free accommodation, shopping discounts, and many such schemes. Reward schemes have become an important deciding factor when choosing a credit card. The best credit cards offer meaningful reward schemes without charging an annual fee. When it comes to choosing a credit card with respect to reward schemes, what matter the most is every individual`s personal requirement. A credit card must be tailored according to personal preferences to ensure maximum benefits and ease of use. Reward credit cards that give free air miles that can get free air tickets are most suitable for frequent flyers. People who travel a lot can get great benefits if their credit card air miles can be combined with the air mile program of any air carrier. Also, some credit card companies offer air miles rewards along with hotel stay and car rental discounts reward programs. Having air miles reward cards will not make much sense to people who fly only once or twice a year. Students can benefit greatly from point system reward schemes. Points earned can be redeemed for cash at the end of the billing cycle, if enough points are accumulated. Students can also take advantage of department store discounts that the credit cards offer, since discounts help students minimize their expenses. If the credit card company is affiliated with grocery stores, then every grocery shopping can be rewarded and earned points can be exchanged for free products or cash. People who commute using only cars can benefit from gas reward cards that some credit card companies offer. This reward scheme works similar to point system, but only at gas stations that participate. Every time the credit card is used at the gas station, points are awarded which can then be redeemed for free gas. Choosing a good credit card needs some time and research on the internet. Comparison of various credit card companies and the offers they provide are detailed on the internet. Comparing the reward schemes of every credit card company is the first step towards choosing a good credit card. Cards that are loaded with more than two reward schemes often charge an annual fee for membership. Before applying for any offers, it is mandatory to read the term of use documents, and the details of the reward schemes. Some credit cards have hidden charges associated with them, which do not come into immediate attention. Some may have restrictions about how the rewards can be redeemed, restrictions on roll back of the unused points, and expiration date for the reward points. All this has to be verified before applying for a rewarding credit card.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
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