What are the pros and cons of a rewards credit card?
I always see cards that get miles, money for disney, whatever…and wonder if they are worth it. Some people are all for rewards cards…others swear they are not worth it, rates are too high etc.
Which really is better, and under what circumstances/spending habits? I am the kind who only uses a card when I NEED to, and in fact will only be getting one because I need a new laptop. What do you think?
Thanks in advance.
I know that credit cards arent good, and as I said I only use them for emergencies. A lap top is a necessity for me, to both study and work, and I was expecting a few more months out of it to save up. As is, dying right before my sons birthday and christmas, to pay with cash I would either be broke for getting the one I need to do what I do, get another sub-par laptop and spend a good half of my day yelling at it and thus becoming less productive, or I need to get a card so I can make only small payments until I get through the holidays, after which I would pay as much extra as I had until I was done.
pros are you get a visa and rewards, cons are none. you build up crtedit w
I have an American Express Rewards card from Costco. It returns 1% on purchases anywhere, 2% on travel, and 3% on restaurants. There is no annual charge and since I pay it off each month, which is what everyone should do, the rate doesn’t matter.
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There is nothing good about any credit card.
If you need or want an item…. save your money.
The rewards are a hook to get you into their credit card. The CC companies make so much money on late fees, finance charges, etc. that giving “us” something back is just giving back what we have paid into.
If your going to end up carrying a balance look for the lowest rates, if your not going to carry a balance, just look for a card that you like. be it with rewards or just a great rate, it doesn’t matter.
If you only use a card when you need to, don’t worry about getting a rewards card. They work best when you make a point to charge everything you can as long as you pay it off in full every single month. If you rarely use it, then get a card with the lowest interest rate you can find and skip the rewards.
Rewards cards usually have a higher interest rate than cards that don’t. You mention you will be getting a laptop and paying it off over time. There is no rewards card that will make it worth paying the higher interest.
As long as you aren’t an impulse buyer, I would recommend you consider a rewards card because if you pay in full every month, you will benefit. For example, our Discover card is paying 5% cashback on gas and car repairs, and although we aren’t spending any more than we would have by paying cash, we’ve accumulated about $100 in cash back. And by paying in full every month we are not paying any interest charges. The Chase Freedom card can pay up to 3% cash back on certain categories of purchases. The American Express Blue Cash card is a good choice for people who spend a lot on credit cards but for most people, the Chase Freedom, Citi Dividend Platinum Rewards, or Discover can be a better choice. You have to evaluate each program to see which is the best fit for your particular spending patterns.
By charging everything we can on rewards cards, then paying in full every month, we have accumulated over $1000 in cash back over the last three years - and that is free money. However, for people who know they are going to spend more than they should, they should stay away because the rewards, although nice to have, do not make up for paying interest or buying stuff you don’t really need.
Do you travel a lot? Then it is high time that you know the benefits of a travel credit card. Among the numerous options available with travel credit cards the most popular ones are free travel points that can be redeemed for free travel, discounts on merchandise, discounted stay at hotel rooms and much more which help you save a lot as you travel.
The benefits of travel credit card differ with the issuer. Some travel credit cards are exclusive to certain airlines such as Delta, Northwest or Jet Blue others offer a range of airlines to choose from. The rewards of some travel cards are limited to free airmiles only whereas some offer a good number of benefits as mentioned above. So, It is always advisable to look around and compare the various offers available from good credit card providers and settle for the one which provides the maximum advantage and benefits with minimum incurred costs.
Another issue that crops up with a travel reward credit card is the bonus that you get when you sign up with the credit card company or do your first purchase with the credit card. Many companies offer bonus airmiles when you get the credit card or when you make the first purchase. These bonus points give you a head-start in redeeming the benefits and getting a free trip. The travel reward points get accumulated as you travel more by using your travel reward credit card. Some credit card companies give you one point for every dollar you spent, some reward you better when you fly with their preferred partner.
The things to watch out when choosing a travel reward credit card is the blackout dates, reward points expiry dates, and travel restrictions. If any credit card offers come with such restrictions it is better to avoid it or get more information about the restrictions from the credit card company to avoid frustration later. Usually these restrictions are mentioned in fine print. So, if skipping fine prints is your regular habit be prepared to get surprised. Get more detail about reward card at: