« »

Tuesday, January 28, 2014

Get the most out of your credit card rewards with these helpful tips

Credit card rewards programs offer incentives to customers
Credit card reward programs add value
By Israel Defeo

There are a lot of benefits to owning a credit card. One of the benefits to having a credit card is that it frees you from bringing a lot of cash with you when you shop. Credit card regulations also offer several consumer protections.

Credit cards are widely accepted so having one lets you pay for things at a lot of places and is especially useful for shopping online. Another benefit to having a credit card is that it helps you earn rewards every time you make a purchase.

For many, these rewards are the main reason for getting a credit card. Unlock the power of your credit card and get more rewards by following these tips. 


A cashback program is one of the many rewards that a credit card can provide cardholders with. The cardholder can get a percentage of the amount spent on the card back as cash. Before you sign up and apply for a credit card, you need to do a little research on which card offers the best cashback rates. You can use a comparison website to find a card that offers the best rate by filtering the results for the ones that have a cashback program. 

Aside from using a comparison website, you could also wait for a big signup offer from credit card issuers. Keep your eye out for promos from specialty websites and even from the mail. Also keep a lookout for seasonal bonus categories where you earn more cashback when you spend on one category for a specific season like gas in the summer or car repairs in winter. You have to opt-in to these seasonal offers first before you get the bonus. 

Air miles 

Who doesn’t want to fly off to a beach somewhere to soak up some sun or somewhere exotic like Hong Kong? Some credit cards allow cardholders to earn air miles for every purchase. The air miles can be exchanged for an airline ticket for your dream vacation. Also use those comparison sites to look for a credit card that offers the best conversion rates for purchases. 

If you have a favourite airline, you could search and look for a credit card that’s co-branded with your favourite airline as these may let you earn more points when flying with them. These cards also usually provide a discount so that’s an added bonus. Look out for welcome offers from these cards that will give you bonus miles. Watch out though as you may have to first spend a certain amount within the first two or three months from when you received the card in order to get the bonus miles. Cards that let cardholders earn air miles usually also provide complimentary airport lounge access so you should also take advantage of these free offers and relax at these lounges the next time you wait for your plane to depart. 

Gas rewards 

If you regularly burn cash to fill up your tank, why not earn a cashback from your gas purchase by using your credit card? Doing your research and going on comparison sites to look for a card that offers the best cashback rates for gas purchases is always important especially if a big portion of your salary goes to filling up your gas tank weekly. 

You could also look into getting a co-branded credit card from the gas station that you frequently gas up from as these can give better rates. 

Reward points 

Credit card reward points can be exchanged for goods and some cards will also let you exchange your reward points to air miles that can go towards an airplane ticket. Some credit cards will give you bonus reward points whenever you shop for a certain category, say, groceries. You might want to check how your card company classifies your favourite store by going online as some stores that people will not necessarily think of as “groceries” can be classified as such so you get bonus points when you shop at these places. 

Many cards can have a special offer where you can double or triple the reward points you earn. Keep an eye out on these special offers and sign up for them. 

Get the most out of your credit card 

In order to maximize the benefits from your credit card, it’s always good to study your purchasing habits first before you sign up for a credit card. Take note of what categories you spend the most on and look for a card that lets you earn the most rewards for purchases in that category. If you usually swipe your credit card to buy groceries, then a card that lets you earn reward points for grocery purchase could be the right one for you. If you have a preferred airline, you could consider getting a co-branded credit card from that airline to get discounts and earn bonus air miles. 

Just make sure to pay off your credit card bills monthly as the interest you’ll be paying will probably be worth more than the rewards you’ll earn and you could lose the rewards you’ve earned as well. 

The proper way to use a credit card is to also not just use the card to merely earn rewards. Just use the card for “needs” and for purchases you can pay for in cash but set the cash aside and use it to pay for your bill once your statement arrives so you still earn points, air miles or cashbacks. These rewards give credit cards added benefits aside from freeing you from carrying a lot of cash when you shop and to let you pay for goods and services online. Making smart moves like comparing credit card rewards before signing up for one helps you earn more rewards by just keeping to your purchase habits. 

About the author:  This article is contributed by Israel Defeo of Money Hero, the leading financial comparison website in Hong Kong.

Image license: PD