If used wisely, you have the option of enjoying a lot of rewards in the form of cashback, miles, or points using rewards credit cards. Rewards earned on credit cards turn out to be a good option for making the most of your spending only when you know how to smartly use them. A lot of people only consider the rate of interest and MasterCard offers while shopping for credit cards. However, looking out for rewards is equally important in this situation. A lot of credit card offers rewards in the following forms.
- Points
- Cashback
- Miles
You can even enjoy a combination of these three on some credit cards depending upon how you are using it.
Let’s first understand the difference between points, miles, and cashback.
Difference Between Points, Miles, and Cashback
Credit card providers generally offer different kinds of rewards on their Rewards Cards depending on their reward’s program.
Miles are generally related to travel rewards. The collected or earned miles on your credit card can usually be redeemed for hotel stays and air tickets. You can redeem them for other selective things as well, however, their value might decrease.
Credit Cards offering cashback let you earn money back on the purchases you make. The money either gets credited back to your card or is deposited into a checking or savings account.
Reward Points are usually versatile and could be used in a number of ways. This includes travel expenses, conversion into cashback, making purchases, redemption for gift cards and merchandise.
Ideal Way of Using the Rewards Credit Card
Using the right type of strategy, your credit card can work properly for you by collecting the maximum amount of rewards. Following are the strategies to assist you in earning more rewards on your Rewards Cards.
- Using the Right Credit Card
The easiest way of earning cashback and points is using your credit cards for making every payment. Make sure you use the right credit card for every purchase so as to maximize whatever you earn. You can label your cards with stickers to keep a track of which one to use where.
- Selecting the Right Option for Redemption
A lot of credit card offers may offer you more value for your rewards if you redeem them in a certain way. Various travel cards usually offer discounts on travel expenses when you use your rewards to make your bookings through their programs.
- Transferring unused Rewards
You can transfer the unused points to other accounts to turn them into rewards. You can also combine various points on different credit cards, but only when all those cards are from the same provider. It might get you the minimum points required for earning a gift card or any other reward.
- Pay Utility Bills Using Your Credit Card
You can make the payment of your utility bills using your credit card. However, sometimes you might have to bear a “convenience fee”. It can be sensible to pay the fee if you have to spend more on the card for earning a welcome bonus. When there is no extra fee, consider making such payments using your Rewards Cards so as to earn points or cashback.
- Paying Ahead on the Bills
In case you are facing a deadline for spending requirements, try to pay ahead on the bills in order to add more charges on the card now.
- Purchasing a Car Through Your Credit Card
You can purchase a car using your credit card so that you can earn a good amount of reward just by making a single payment. You can make the payment of the full balance after you get the credit card statement.
- Getting a Sign-up Bonus
Signing-up for a new credit card is another fast way of getting a reward on your credit card. A lot of credit card providers offer miles, points, or cashback as a welcome or sign-up bonus when you sign-up for a new card.
- Funding Fresh Bank Accounts Through Your Credit Card
You may also earn sign-up bonuses on opening new accounts with your bank while sometimes funding these new accounts using your Rewards cards. Simply put, you can earn rewards by putting funds in the bank.
- Go on Shopping with Friends Who Make Cash Payments
You should go out for shopping with friends who prefer using cash. You can offer to pay using your credit card and ask them for cash. You can tell them about the purchase protection advantages that come along with your credit card. And the best part is that you earn rewards against these purchases.
- Adding a User to Your Credit Card
You can add a spouse or any other of your family member as a user on the credit card. Amongst the best reasons for using credit cards over cash are the rewards you earn.
- Initiate Payments at Collective Meals
Whenever you dine with your friends and split up the bill, collect cash from everyone and charge the complete bill through the best credit card you own.
- Purchasing a Stock of Non-Perishables
Can’t wait to get rewards on your credit card to redeem them for flight tickets, hotel stays, etc.? Or maybe the grocery stores are going to be taken off from the bonus cashback category. You can purchase non-perishable items so as to get the charges on your credit card right away. Canned food stays good for a long time and goods made of paper last even more. Hence it is advised that invest in these items to earn rewards instantly.
- Pay College Fee Using Credit Card
A few payment processors allow you to pay your college tuition fee through your credit card. They may charge a certain service fee. These processors promise to cover late fee (if any) in case they could not get it done within time.
- Payment of Student Loan Through Credit Card
Some lenders or banks allow the payments on student loan through your credit card. However, they might charge a fee for the same. It can prove to be worth paying such fees in order to meet a certain spending requirement. But this is possible only when you make the payment of the loan amount in full as soon as you receive your statement so as to avoid bearing interest.
To Sum Up!
Now earning rewards and putting more money in your pockets is not as difficult as it sounds, is it? You should have a good to an excellent credit score to obtain a credit card with not just great MasterCard offers but amazing rewards too. Unless you experience trouble in handling credit, you can always use your credit card for making payments over cash or other means. That way you can earn various rewards on your card and then redeem them for purchasing flight tickets, movie tickets, shopping, hotel bookings and more. After all, who doesn’t like to earn rewards?
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Contributed content
Founder Dinis Guarda
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