Rewards credit cards sound so “rewarding”, don’t they? But what are they, exactly – and does it really pay to have one?
Well, to begin with, this card “rewards” those who rack up their monthly bills for goods, services and utilities on their cards. These days, a person can use his card to pay his bail out of jail, and can even use it to charge a “butt lift” at his local plastic surgeon’s office.
And yes, some of the rewards the cards offer are fantastic! Members can expect “thank you’s” in the form of cash rebate checks, travel miles, and even as points earned towards the purchase of some of the latest and most popular merchandise. Moreover, the faster someone pays his monthly balance down, the faster his rewards pile up – and the bigger the pile gets!
However, a wise person is a careful person, in that he makes sure to go slowly over each and every line of any credit card agreement, BEFORE he signs. Sometimes these cards carry bigger fees on them than the ones that aren’t offering any “frills” to their customers. And, what this means to someone who isn’t aware of the possibility, is he could end up taking it in the wallet as his reward – especially if this turns out to be the case with his new card.
Furthermore, it could happen that you do everything right in following what the creditor asks of you, but when you go to redeem your rewards, you suddenly find you can’t cash them out. Why? Because you skimmed over the fine print, and missed the tiny little section regarding the “hidden loop hole” that limits or voids your ability to redeem your points.
So, now that you’re well educated on the finer points of the “thank you” program, do you think that you’re someone who could handle a card like this responsibly? Or are you the type who is so prone to self-destruction, that just to see an ad for this kind of card would be all it would take for you to start your downhill run? Well, don’t stop reading now:
You’ll probably do OK if you’re a person who doesn’t make the decision to sneeze until you know all the facts. If this describes you – you’re probably very good with handling money, as well – and you most likely don’t stop with the phone calls to companies that have failed to deliver what they promised you, until they make good on that promise. And especially if you know – but don’t care – how long you’ll probably have to wait it out with your credit card company’s rewards program at some point, in order to get what you want, then you’re probably the world’s only safe candidate for this kind of card.
But if you’re like most of us, then you don’t always consider your monthly credit card balance on the top ten list of things you MUST do perfectly, in order to be able to make it through the day. Therefore, if this is you – run, don’t walk – away from any offer that even resembles what you’ve just read.
So, when you’re shopping around for credit cards, be careful of the ones with the “rewards” programs. Know yourself well enough as to how responsible you are with money. You don’t want to end up with a huge accrual of “punishment points” as a company’s way of saying “thanks for being our customer”.
Learn more about rewards credit cards, reading our credit card guide.
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