When A Reward Credit Card Becomes Unrewarding

Are you a reward credit cardholder? If yes, are you really getting the most out of your reward credit card? Or do you find yourself spending more on fees than getting rewarded? In reality, many owners of credit cards do not really get the benefits they thought their credit card with reward will bring them. Unfortunately, what seems like a great reward program at first glance turns out to be an unrewarding program later on.

What makes a reward credit card unrewarding? Consider the following points:

1. Rewards that you can’t enjoy.

Why get a credit card with Frequent Flier Miles rewards if you can’t enjoy the free travel anyways? Some travel rewards cardholders find it difficult to book flights because no seats are available for Frequent Flier Miles passengers especially during peak seasons. In the end, you may have to wait for the next available flight or watch as your points expire.

2. Expensive maintenance fees.

How much will it cost you to keep your account active? Some credit cards with rewards carry very high annual fees and finance charges so that the cardholder ends up with too many fees to pay. Think about it, if you have to pay $100 each year to continue using your reward credit card, are you truly rewarded or do you spend more on maintenance fees?

3. Reward Limits.

There are reward credit cards that impose restrictions. For instance, there might be a cap on the value of rewards you can earn in a month or in a year. Once you’ve reached the maximum worth of purchase, your points may stop accumulating regardless of how much more you spend with your reward credit card. Thus, even as you continue to shop with your credit card, you get nothing in return.

Some reward credit cards will not award you points until after you’ve made the required worth of purchase. For example, you may need to spend at least $500 or $1,000 before you start to earn points from your succeeding purchases.

4. Rewards that expire before you can redeem them.

Is there an expiration date? If there is, you could lose all your hard-earned points if you don’t redeem them on time. It’s best to avoid such credit cards and look for one that provides a reasonable length of time for you to be able redeem your points. You may also look for a credit card that will allow you to carry over unused points until you’ve collected enough to qualify for redemption.

5. Limited redemption options.

Does your credit card reward offer flexible options in redeeming rewards? For instance, if you don’t want to go on a trip or if it’s not possible for you to travel, will you have the option to exchange your miles points for cash back rather than have it forfeited?

Can you exchange your miles points for other types of rewards such as cash, gift check, merchandise, or as credit to your account? It’s best to find a reward credit card that offers flexible redemption options to be sure that you’ll enjoy the rewards you deserve.


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