5 Tips For Maximizing Credit Card Rewards

July 10, 2014, Written By Lynn Oldshue
Rewards Credit Card Loyalty Points Program

Earning rewards on your credit card is a great benefit to consumers who completely pay off their balance each month on time. You can actually make money by making transactions with a credit card.

But sometimes credit card companies make it slightly challenging to redeem your rewards. Issuers make it easy to spend money, but you may have to jump through a hoop or two to obtain the rewards. In order for you to get the full value out of your credit card’s reward program, you’ll want to make sure you know the rules and take advantage of the opportunities that you are afforded. You’ll also want to ensure you pick the right credit card for your lifestyle. You don’t want to be making purchases just for the sake of the rewards program. You want to choose a credit card that has a rewards program that already fits your spending habits.

Know The Rules

Credit card companies have a plethora of different rewards programs. These rewards programs can be simple, or they can be complex with rotating categories that require you to register each quarter. There might be caps on the amount of rewards you can earn, especially cash back rewards. The responsibility is on you as a consumer to know the rules of your rewards program so you don’t lose money. Know the rules before you begin using the card so you are familiar with any spending threshold you need to meet or certain blackout dates for your travel rewards. Doing the extra research might be a bit time consuming, but it will save you in the long run.

How Much Do You Expect To Use Your Card?

If your card only gives rewards after you have spent $5,000, but you only expect to spend $1,500 on the credit card this year, is it really prudent to use that credit card? If you are looking to maximize your rewards, there are better options for you to choose from that will optimize your ability to use your rewards. Remember, you shouldn’t be spending on your credit card just to get rewards—you should be factoring in your budget and how much you plan to spend. For example, if you are going to spend a good deal of money on travel each year, it might be worth it to get a credit card with strong travel rewards in order to maximize your credit card rewards.

What Categories Do You Expect To Spend The Most On?

A number of current credit cards have revolving categories. That means individuals using these cards can earn enhanced rewards on purchases made in a certain category—but the categories change after a set period of time. Usually, that period of time is a quarter of a year—which means after three months, you’ll have to make a different type of purchase to earn these enhanced rewards. The categories can vary from restaurants to hotels or gas. You’ll want to make sure you are going to make purchases in the different revolving categories, or else the credit card might not be worth it. For example, if you don’t eat out, and one of the revolving categories is restaurant purchases, you might be missing out. You should check to make sure your credit card offers enhanced rewards in categories that fit your purchase patterns.

Don’t Let Your Rewards Expire

This is a big one, and although it might seem obvious, it’s not. Don’t let your rewards expire! This point should probably be filed under “know the rules,” but it is so important. You must know when your points expire, and if there are any specific restrictions on using them. After all, what good are your rewards if you can’t use them? Your rewards might expire before you think they should, so contact your credit card company if you have any questions regarding the program. Make sure you understand the terms and conditions of the rewards program before you start making purchases.

Watch Out For Late Fees

You might think missing a payment on your credit card doesn’t have anything to do with your bonus points. For some cardholders, that’s not the case. You’ll want to make sure you double check the terms of your card since some programs will take back all the bonus points you have earned in a given month if you fail to make your payment on time. Late fees can affect your rewards, bank account and your credit score, so make sure you stay vigilant in paying all of your credit card bills on time. Making a major purchase and losing out on the bonus points can be painful, so always pay your credit card bill on time. Don’t forget that many credit card companies will also increase your interest rate if you continually miss payments.

There are plenty of ways to maximize your credit card rewards. But as previously noted, perhaps the most important choice you can make is the type of card you obtain. You’ll want to make sure to get a credit card which fits your lifestyle, and one where your rewards program works within your current spending patterns. Spending money simply to get rewards is a recipe for falling into debt, which nobody wants to do.

Make sure you search for a credit card that fits your current purchases—whether those purchases are on flights, hotels or gas. There are plenty of different categories of rewards, and you can choose one that fits you best. There are different strategies for maximizing your credit card rewards, but you’ll want to make sure you completely understand the rules of your program. Don’t let your rewards expire. Know your program and how the credit card company allows you to utilize your rewards!



The information contained within this article was accurate as of July 10, 2014. For up-to-date
information on any of the terms, cards or offers mentioned above, visit the issuer's website.