Credit Card Rewards Can Earn You Money

When credit cards offer “rewards” to their cardholders, it is done in connection with the number of purchases the customer makes with the card.Some of the most popular rewards are air miles and discounts off the cost of flights offered by certain airlines, however, the variety of rewards that are available is nearly endless.It is possible to earn discount points toward the purchase of a new car, and there are some retailers and stores which give you loyalty rewards for using a card issued in their name.  

These rewards offered by credit cards can be very desirable to have, but you should ask yourself the question as to whether they are worth it.You can answer this question for yourself by making comparisons between the interest rates on purchases made with cards having rewards and cards that do not have rewards.There is a great number of rewards credit cards that offer some sort of reward or loyalty bonus, but the lowest rate of interest on these cards is likely to be in the area of 15% APR.This is about 7-8% more in interest than you would pay for a very basic, low-interest credit card and infinitely greater, of course, than you would be paying on the zero-percent rate of interest on the introductory offer with many other credit cards.The interest rate on some of the reward cards can be as much as 30% APR, you will find this out if a comparison of the interest rates on the broad range of these cards is done.

In case you are a regular credit card user who earns sufficient rewards and you are paying interest at these kinds of rates, it may worthwhile for you to consider choosing a much lower interest credit card which does not offer rewards.If you are the kind of credit card user who always tries to pay off the whole balance on the card before the payment is actually due, and who therefore never pays any interest, the rewards for using your card are genuinely free.You may want to consider the alternate choice of the cash-back credit card if you are not sure you can maintain the discipline of paying off the whole balance of your credit card each month.The cash back credit card gives back cash to you according what has been spent on the card each month and the reward credit card also works on this principally in the same manner.      

You will be paying an excessive amount for the use of a cash back credit card, if the amount you spend attracts the 19% APR in interest and the current best cash back rate is somewhere around 5 percent on the spent amount.If you have developed the habit of paying all of your outstanding balances each month to avoid paying interest, you can of course, put the 5% cash back into your own pocket.    

It can certainly be worthwhile to you if you use the cash back credit cards and those that offer rewards if you keep paying your monthly outstanding balances consistently and avoid the interest that will be charged.If you use the cash back and rewards credit cards in this manner you can put cash into your own pocket and accumulate the necessary reward points to help you acquire a wanted or needed item.