How to Collect and Redeem Reward Points

After doing research and comparison of different reward credit cards in the market, you have finally decided which credit card to get. Now that you're approved, it's time to plan your strategy to get the most from your reward credit card. Check out the following tips on how you can earn more points and manage your account effectively.

On Collecting Reward Points

Credit card companies offer rewards in different ways. Some reward credit cards offer 1 point for every dollar spent while others give double points or more. Credit cards that are sponsored by specific merchants usually offer bigger points per dollar spent on qualifying purchases. The phrase "qualifying purchases" refer to purchases made from affiliated shops or branches. On the other hand, credit cards that are sponsored by banks usually give points from general types purchases.

When using a reward credit card, it's important to watch your personal spending to avoid the trap of bad credit. Submitting payments on time has many benefits. It enables you to save money by not paying interest rate fees and late penalty charges. Remember that credit cards with rewards often charge higher APR than their non-reward counterparts. Prompt payment also reduces the risk of debt build-up and bad credit.

To collect points quickly, use your reward credit card to pay your monthly utility bills such as electricity, cable, internet, telephone bills, etc. Thus, you do not necessarily need to use your card on new purchases just to collect points. However, if you're going to charge your utility bills to your reward credit card, be sure to post your payment on or before the due date to avoid finance charges.

On Redeeming Reward Points

The rules of redemption vary from one reward credit card to the next. Typically, you will be able to monitor the points you've earned by logging in to your account online. After collecting sufficient number of points, you may have several options of redeeming your rewards, depending on your reward credit card issuer.

Some reward credit cards allow you to exchange points for cash, gift certificate, merchandise, or as credit to your account. Some airline miles reward credit cards give the option to exchange your points for hotel stays instead of a free flight. If you do not want to travel, you can redeem your rewards in other ways.

Are you aware of blackout dates? Reward programs vary from one credit card to another so make sure that you are clear about your credit card's reward system. For instance, your points may become forfeited if you fail to redeem them on time.

If you own an airline miles reward credit card, redeeming your free flight may depend on the availability of the seats reserved for reward credit card passengers. For cash back cardholders, you may only be able to exchange your points for cash after reaching the minimum required value of purchase.

Yes, you need to evaluate the Terms and Conditions of your chosen reward credit card before signing up that application. If you already own a reward credit card, review the Agreement so you'll know how to adjust your spending. Take note that the key to enjoying credit card rewards is to abide by your issuer's terms and conditions.