After you find the perfect rewards credit card for you, there's still work to be done. Using your new card effectively can help you earn the most rewards points or cash back. Check out a few pointers on how you could put that rewards card to better use.
Pay Off Your Balance Each Month
Interest payments make the credit card world go 'round. This is especially true in the case of rewards cards, which almost always come with elevated interest rates. Once you start carrying a balance on these, you're essentially negating the benefits you've stacked up. So if you're looking to get the most out of your rewards card, make sure you're all set to pay on time.
Read the Terms Carefully
One key step to getting the most out of your rewards cards is checking all the fine print that comes along with them. Make sure you understand exactly how you will accrue points and miles, and what steps you have to take to redeem those benefits. Some cards may require you to opt into rewards programs before you can earn, so stay on top of requirements like these so that you don't lose out on any of the rewards that could be coming your way.
Redeem Rewards Regularly
A whole lot of miles, points and other rewards go unclaimed every year. Rewards could go to waste because cardholders don't understand how to redeem their points or because they simply forget to take action before those points or rewards expire. Most rewards will disappear after a certain point, so it's best to stay aware of that date before it sneaks up on you.
It's generally advisable to redeem your rewards regularly. In addition to expiration dates, many consumers don't realize that the value of the points and miles that they earn may decrease over time, so that what they think they've earned might end up being worth significantly less. For this reason, it often makes sense to redeem these rewards sooner rather than later. By promptly cashing in, you can make sure you're getting the benefits that you thought you'd be getting when you did all that spending in the first place.
Keep Track of Seasonal Changes and Other Campaigns
Many rewards or cash back credit cards will change their rewards rates or rewards availability based on the time of year or other campaigns. If certain types of spending are set to be more valuable during certain times of the year, you could stand to gain by adjusting your spending habits accordingly. If you have several rewards cards, it's a good idea to stay on top of what each card is offering at any given time, and choose which card to use accordingly.
Seasonal campaigns could include a greater emphasis on rewards for gas during the summer, for instance, or for specific retailers during the holiday season. Some cards may also adjust their benefits periodically without tying changes to specific seasons or holidays, so keep an eye out.
Monitor Your Spending
It's important to remember that these cards are meant to provide added benefits. Don't let the allure of points, miles or other rewards send you into spending overdrive. Collecting rewards or cash back probably won't help you much if you're going to exceed your budget to get them in the first place.
You can keep track of your credit card balances by connecting your credit cards to your Credit Karma account via our My Spending tool. There, you can track your spending from month to month, as well as see it broken out into specific spending categories. If you're collecting double your regular rewards for dining out, you might want to check out your restaurant spending to see that the promise of rewards isn't draining your bank account.
If used effectively, earning rewards from your credit cards can feel like you're getting something for free. Collecting cash back or points on money you would have spent anyway can feel pretty good. If you have a rewards card or are looking to get one, keep these tips in mind to get the most out of your experience.
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