Tuesday, March 13, 2007

Rewards Cards - Are They Right For You?

Rewards cards have got go the up-to-the-minute rage in the credit card industry. In the past, consumers shopped for credit cards that offered the lowest interest rate. Next came cards with low interest rates and no annual fees. Today, consumers can shop for cards based on what type of “reward” they can earn for using a specific issuer’s card.

How makes a reward programme work? Typically, the programme awardings points, "dollars" or a cash value based on the amount you charge. The rate at which you accumulate points changes depending on what you charge or where you charge it. Some programs offer extra points for using their card at a specific topographic point such as as a supermarket or fast nutrient eating house or for certain items.

Some programs offer a assortment of rewards. Consumers can earn meals, tickets to sporting events, airline tickets, electronics, or even make their ain reward program.

The end is to get you the consumer to utilize your credit card as much as possible. Why? FEES! The credit card issuer do money from two beginnings each clip you utilize their card. First, from the merchant who pays the issuer a merchant transaction fee and secondly, from you through finance charges and late fees.

A recent study establish that nearly half of U.S. cardholders enrolled in a credit card rewards programme have got never redeemed their points. However, 60% of consumers said rewards programme influences their determination when crucial which credit card to utilize for a purchase.

When considering an offer for a card that offers rewards, be certain to read the mulct print. Find out what you have got to make to earn points. Look carefully for any limitations as to when you can deliver them. Also check to see if your points carry over from one twelvemonth to the next.

Reward programs most profit those who pay off their balances monthly. For those who carry a balance or even pay late, the consequent higher balances and fees aren’t really much of a reward, are they?

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