Managing Credit

4 Ways to Take Advantage of Credit Card Rewards

Exploring the (potential) win-win of credit card reward programs

Couple walking down the street in foreign country
 

Cash back, airline miles, points for gasoline. These days there are so many credits cards that offer a little something extra. No wonder, then, that 86 percent of consumers who use credit cards as their primary method of payment are in a rewards program of some kind.1

While these points and cashback offers can be tantalizing, the variety of options can also be overwhelming as you decide which card and rewards program is right for you. Here’s a helpful list of things to consider when choosing a credit card with incentives.

1. Pick the program that fits your spending.

“The most important way to take advantage of credit card rewards is to make sure you have a card that matches up with how you spend,” says Kimberly Palmer, credit cards expert at NerdWallet. For example, a card that racks up airline miles doesn’t make much sense if you’re a road tripper at heart. But for an airline warrior, miles might be the perfect fit.

Matchmaking doesn’t only matter on the perks side; you also want a card that will give you the most points for what you tend to buy. If you’re spending a lot of money feeding your family, you’ll want to pick a card that gives you high rewards for grocery shopping or dining out. Or perhaps your spending is all over the map, or you aren’t sure what kind of rewards you want. Palmer says a general flat-rate cash-back card is generally your best bet in that situation.

2. Always pay your balance in full (or what's the point!)

There’s no two-ways about it—paying off your credit card balance in full each month is the best way to go. But not very many Americans do this.

In fact, only 35 percent of credit card holders pay off their credit card bills monthly.2 The rest are “revolvers”—those who carry debt and are subject to interest payments. The best way to maximize your rewards program is to pay off your card every month. This way, you get all the rewards but with none of the interest. That’s a win-win.

3. If shopping for a new card, comparison shop for new cardmember bonuses.

Credit card bonuses offer a great way to earn hundreds of dollars in rewards right out of the gate. This is especially true if you use your card regularly once you apply. But some of the best deals don’t always last, so it’s important to compare the details of different bonuses side-by-side.

4. Learn how to redeem your hard-earned rewards.

A recent study found that 31 percent of credit card holders have never redeemed their credit card rewards.3 Crazy talk, right? This could be partially due to the difficulty involved in actually redeeming those rewards.

“Some cards have more complicated redemption systems than others, and if you end up letting your points just sit in your account, you aren't getting all of the benefits from your card,” Palmer says.

So whether it’s a cash-back option, a credit on your account balance, or banking your points to travel the world, make sure that it's easy to redeem your points and that you know how to do so, Palmer adds. 

Reward yourself

Are you an active jet-setter, or does cash back fit your lifestyle?
Find out which SunTrust credit card may work best for you.

1Credit card rewards and cardholder satisfaction statistics,” April 4, 2016, Nasdaq

2 “The Average American Is in Credit Card Debt, No Matter the Economy,” Feb. 9, 2016, Money

3 “3 in 10 Have Never Redeemed Credit Card Rewards,” April 12, 2017, Bankrate.com

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