If you are like the majority of people looking for ways to save on your shopping and travels, its high time you looked into a credit card with incentives that offer cash back.
These kinds of credit cards are great assets. However, it’s essential to choose the right one. With these credit cards, you earn a percentage back of whatever you spent using the card.
In this article, you’ll learn about how cashback credit cards work. Read on to find out how you can get the most out of your cashback credit card.
What to Consider When Signing Up
Financial advisors recommend looking at your spending habits before signing up for a particular credit card. This is because most cashback cards are created with certain types of spenders in mind.
For instance, if you are a frequent traveler, some cashback cards are tailored to you, while others focus on people who are frequent diners, shoppers, or commuters.
Also consider that applying for many cards can hurt your credit score. Further many cards offer sign-up bonuses, but, be sure to read to carefully read the fine print first. As a pro tip, go for a card that provides smaller sign-up bonuses but with a higher rate of cashback rewards.
Many cards have annual fees, some of which can reach up to $500 per year. However, cards with these fees usually come with great rewards programs.
To make sure you’re still getting a good deal, calculate how much you will be spending versus how much cash back you will get. Also, try to pay your credit card on time as late payments stack up and can cancel your rewards.
Also, watch out for foreign transaction fees, which will kick in if you use your credit card abroad or when online shopping from a foreign store. Be sure to apply for cards with low or no foreign transaction fees.
When earning points through purchases, you card issuer will convert them into a certain amount that you will receive as cash back. Different card issuers have different policies regarding this. Be sure to read the fine print and, if still in doubt, ask your card issuer for clarification.
Once you have accumulated your points, you can redeem them by either going to the company’s website or calling their customer care hotlines. How often you can redeem your cash back depends on your card issuer. Some issuers allow you to pay right away while other require you to first to earn a minimum amount.
Before applying for a particular cashback credit card, consider incentives such as cashback rewards. To keep your rewards valid, be sure to use your card once every three months.