There are different types of reward credit cards available in the market. Most of the providers term them as "reward", and they are given in many different forms. Basically, they ensure that their card holders get a certain benefits by using their product, and hence the term reward fits well in this situation.
Well, some of the rewards offered by the credit card companies might be helpful to you. On the other hand, some of the rewards might not be something that you would ever use. While purchasing the credit card, it would be wise for you to make sure that the reward points offered by the company are something that would be useful to you.
You must ask yourself a few questions to know about which credit card will suit you the most. Let us consider the following few things that you might want to consider:
First of all, think about the reasonable amount of credit limit that would best serve you. You will need to consider your spending habits and financial commitments. You must also give a little thought to your credit score. If it is not up to the mark, most of the banks will decline your credit card application.
The second important thing to consider is how you would like to make your repayments. You could either pay a minimum due amount or clear the credit completely. The banks will charge you with interest rates if you choose to pay the minimum due amount.
The most important deciding factor for getting any credit card would be your credit scores. The banks will not improve your credit card application if your score is not good. If such as the case with you, then you will first need to work towards improving your credit scores and then applied for a card with the bank.
If you opt for bigger credit card limit, then it is not a bad idea at all. You will always be able to keep a certain amount of balance credit available as a backup for your needs. However, you will need to be disciplined while using the credit facilities.
You will need to manage your expenses wisely so that your credit does not get out of hand. It would severely bring down your credit scores, and you will not be in a position to apply for loans with other banks or financial institutions either.
Having answered the above questions honestly, you must now consider what kind of reward will be most appropriate for you. Check about the reward points that are awarded on your purchases. It is nothing but the extra benefit that you get.
Some banks will offer discounts on any tickets and at some selected restaurants and stores. You'll be saving a significant amount of money by making use of reward points, and other special offers provided by the banks.
Some of the available choices are as follows:
Frequent flier miles
Cash back bonuses
Reward based on points scored
Card providers will offer number of different options on these above choices. Some of the well known banks in the USA offer twenty different options for charitable contribution cards.
In general, you must choose a type of credit card that matches with your spending pattern or your lifestyle. Also, it is a good idea to have only one or two different credit cards, because more the cards you have, the more you tend to spend. Your credit score will also be adversely affected, if you carry too many credit cards.
If you are holding too many credit cards, then by using them separately, your reward points will be spread over different cards. You might not be able to use your rewards as efficiently as you could with one card. You may keep as many credit cards in your wallet, but you must ensure that you pay all their dues in a timely manner.
While looking at reward options in any card, you must look at the various forms of rewards offered by the card sellers. Some of the common rewards are cash rebates, where you can buy certain items against redeemed points, gift cards, or certain air travel discounts. You must therefore, choose those reward programs, which is useful for you in the long run. Cash back is the most appropriate reward plan for many of the card holders.
In order to select the right kind of credit card keeping in view of rewards, you must consider the following points.
Credit card cost
You must remember that different cards have different fees, and also their interest charges are different. Most of the annual fees charged for the card may range from high to moderate to low. Some of the cards are available for free too.
Some credit cards charge a very high rate of interest. Therefore, while selecting any credit card, consider all these aspects and plan how you are going to pay the annual charges and credit card dues, in order to maintain your credit card account. You must also make sure that this entire amount that is to be paid in order to maintain your credit card, and it should not offset your credit card rewards.
Every card holder desires to have maximum rewards, but they are usually limited. It depends upon the policy of the issuer of the cards.
Expiry date of reward points
You must know the dates by which you must avail your reward points. Therefore, choose those cards where they offer a reasonable amount of time to avail these point benefits.
Spending limits to avail reward points
Some companies specify a certain amount of spending limit in order to avail reward points. You must understand all about it clearly, and it must be within your spending capacity.
There are plenty of card supplies in the market, and therefore you get plenty of choices to make while selecting the best credit card.