Using Credit Cards To Earn Reward Points

Using Credit Cards To Earn Reward PointsOne of my most favorite ways to travel for cheap is by using credit cards to earn credit card rewards points.

I have earned really amazing vacations this way, and I have even been able to take my friends and family members on trips with my credit card rewards points as well.

Below are some of the things you should know if you are interested in using credit cards to earn rewards.

What can I earn with a credit card?

Only certain credit cards allow you to earn reward points, so first you will have to start with finding one that does. After you do, each credit card offers different types of reward points.

Some only offer cash back, some only offer gift cards, some only offer travel, and some offer all three or just a mixture.

At first, I was all about the cash back and scoring some free gift cards. Then, I really got into travel rewards because travel seemed to be the best deal I could always find. I have been able to redeem around 10 roundtrip flights for vacations I have gone on. I don’t even spend any more than I normally would – it’s all just routine spending such as on gas and groceries!

Will it hurt my credit score?

Applying for a new credit card can bring your credit score down a little bit, but usually it’s nothing too drastic.

If you are about to buy a home, then it’s usually best to not apply for a new credit card right before then. Always consult with your mortgage loan officer about something like this. You don’t want something like a credit card to increase your interest rate on a mortgage.

If you happen to need help improving your credit score I recommend you check out this link because they are great! http://aaacreditguide.com/creditrepair-com/

 

How can I stay safe?

If you are using credit cards for the sole purpose of earning rewards, then you always need to be safe. Here are my tips:

  • Don’t buy items you don’t need. Just because you are earning points does not mean the item is free. You don’t want to go into credit card debt!
  • Watch your utilization rate. The saying is that you want to stay below 30% of your credit card limit so that you don’t hurt your credit score. So, if your limit is $1,000 on your credit card, do not spend more than $300 on your credit card.
  • Is there an annual fee? Some credit cards have very high annual fees. You will have to weigh the positives and negatives to see if this fee is worthwhile to you.
  • Always understand the rules and definitions of terms when it comes to your credit card. These can include: minimum payment, interest rate, expiration, etc.

Do you use credit cards for their rewards? Why or why not?

 


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