There are many credit card deals that are aimed at people with a lot of debt to manage. These credit card deals offer 0% balance transfer rates and low long term interest rates to credit card customers. But people who pay off their credit card balance in full every month do not gain a lot from those deals. Those people would be better off shopping around for a credit card that offers a reward. There are several credit card reward schemes to choose from. Cash Back Rewards Cash back rewards are rewards where credit card customers get a cash rebate that is linked to the spending on the card. Usually this will be a percentage of the amount spent, anywhere from 0.5% or more depending on the card. Some cards offer a rebate of 1 for every 100 spent, others offer as much as 3. This soon adds up. This is paid at different times. This can be an attractive reward for people who put large balances on their credit cards and clear them each month. Earning Air Miles Many credit cards also allow cardholders to earn air miles. Again this is linked to the spending on the credit card. Cardholders earn a specified number of points for every pound spent. These can then be applied to travel with major airlines. Some airlines, such as British Airways, BMI and others, have their own points schemes. Others use the international Air Miles program. Air Miles can also be used to qualify for other airline rewards such as upgrades to airport lounges and so on. Other types of travel rebates can also be earned. Earning Points With A Credit Card An alternative to cash back rewards is a point earning system. Each pound spent equates to a certain number of points. An example of a points scheme is the Nectar scheme, one of the largest in the UK. Like supermarket loyalty card points schemes, credit card points schemes allow cardholders to exchange their points for vouchers, cash or discounts on goods and services. Other Rewards Some credit cards allow customers to apply their points to other rewards. For example, the GM credit card allows you to save your cash back to apply to money off a car. Some credit cards allow members to use their points to book holidays, pay for flights and buy wine. And one credit card offers a concierge services, multi-trip travel insurance and executive lounge pass. What To Watch Out For Many of the reward cards have high interest rates compared with the 0% and low interest deals. This should not matter for people who clear their balances in full each month. However people who do not clear their balances in full but who still want to benefit from the rewards will need to be careful. Many cash back reward cards have a cap on how much cash back a cardholder can earn each year. When choosing a reward card, look for the credit card that offers the highest reward or the one that will give rewards that are useful to you. Air miles are only useful if you go on holiday, while discount vouchers can be used in a range of stores, so you will easily find one that is useful for you. |
