How to Maximize Credit Card Benefits

by | Jan 5, 2024 | Billsaver, Understanding Credit Cards

Many credit cards offer some very attractive rewards. The challenge is knowing how to get the most out of your credit card rewards program. Making just a few simple spending adjustments can have a major impact on the amount of rewards you earn.

When used properly, credit cards can be an excellent financial tool, since you can earn money by using them. The more you spend, the more you earn. However, you have to use them correctly. Paying your balance in full, on time every month can keep your credit card profitable. If you carry balances each month, the interest penalty you pay can be detrimental to your financial health. Thus, using a card improperly can be one of the worst things you can do to your financial well-being.

This guide will help you maximize your credit card rewards while maintaining good credit.

Start with the Right Program

Before making a major purchase, whether it be for a house, car or insurance policy, most people compare all of their options before making a decision to ensure they are opting for the best option. A credit card rewards program should be no different. If you settle on the first rewards credit card to come your way, you may not be picking the one that best matches your spending habits, and this will have a major impact on the amount of rewards you receive.

To choose the right rewards credit card, you need to figure how you spend money and how you would like to use your rewards card benefits. If most of your money goes towards fuel and groceries, you want to find a card that gives big rewards for those purchases. You also want to make sure you will actually use the benefits that you earn, though. If you are not a big traveler, there is no point in enrolling for a card with airline miles. Search for a card that will reward you for your specific expenditures and provides benefits you will use and enjoy.

Get the Most from Introductory Offers

Many cards give an introductory offer, so you will want to pay attention to these as you search for a credit card rewards program. For example, the Capital One VentureOne card gives new cardholders 20,000 airline miles when $1,000 is spent on purchases within the first three months of opening the account. It is important to know about and take advantage of these offers, as they are available only for a short period of time. You want to take steps to reach the spending threshold so that you qualify for your credit card’s introductory offers.

Uncover the Details of Your Rewards Program

Once you have chosen a credit card rewards program, read the fine print to understand how benefits will be rewarded. Are you given five points for every $1 spent on groceries, or are you given a flat one point for every $1 spent? Are you limited to a certain number of points, and if so, what is that limit? The terms and conditions of your credit card will have all of these answers, so make sure you read them carefully.

There are a few general tips. Some rewards programs work on a rotating calendar, which means you may earn 5% cash back on gas one quarter, and then switch to 5% cash back on home improvements during the next quarter. If you are not paying attention, you will miss out on some opportunities to earn more rewards. The Chase Freedom card works in this way to accommodate yearly shopping trends, but the Chase Freedom Unlimited card does not.

Use Your Card Often

The only way to actually earn credit card rewards is to use your card often, which means you should charge items even if you have cash available to make the purchase. However, you will want to pay off your credit card balance each month so you are not racking up interest fees and charges. You are using your credit card to build credit and earn benefits, not get into debt.

It is important to know you do not need to wait until the end of the month to pay your bill. In fact, you can pay the balance as soon as a transaction appears on your statement, which may take a few days. As soon as the expenditure appears, transfer money from your bank account to cover the expense. If you do this regularly, you will earn substantial rewards points.

Take Heed of Expiration Dates

It is imperative to use your credit card rewards points before they expire. Many never expire, but a few cards do put a deadline on using your rewards. If you want to maximize your benefits, you will need to keep a close eye on expiration dates.

Reap the Rewards

Once you have saved enough rewards points, enjoy whatever you choose! Choosing your benefits is when you will see your hard work pay off. Explore the benefits your card offers and see what your spending earned you. Chances are, it will be something that made this journey worthwhile.