How to Maximize the Benefits of a Credit Card
- 1). Use your card to pay for everyday things, such as gas, groceries and medicine. This is money you would spend anyway, so you should not be racking up debt that you can't pay off by doing this. This will help you maximize your cash-back or airline miles rewards.
- 2). Pay your bill in full and on time every month. This is critical, because not only will interest and late fees cut into your rewards, they can also affect your credit report and lower your credit score.
- 3). Avoid cards that charge annual fees, unless the benefits outweigh what you could get with a card without such fees. For instance, if a card charges a $50 annual fee but offers you double the points of another card, it may be worth it.
- 4). Take all opportunities to maximize your rewards. If a card offers double rewards for shopping at a certain merchant, make sure to shop there. If it offers you extra points to use a certain airline or stay at a certain hotel, do that, as long as the cost is otherwise the same.
- 5). Use more than one card to maximize rewards. Some cards put a cap on the amount of annual rewards you can receive. By using two or more cards interchangeably, you can make sure you never hit the cap and therefore keep earning rewards. Also consider using more than one card to get extra rewards at different places. For instance, one card may offer extra cash back at gas stations, while another offers the same benefit, but only at pharmacies.
- 6). Use no-interest offers to pay off debt or make big purchases. If you need to make a large purchase, such as new appliances for your kitchen, find a card that will offer you no interest for a significant amount of time and finance the purchase with your card. Make sure to pay off the balance in full before the offer expires, or you will be hit with finance charges for the full amount you charged. Also look for opportunities to transfer any debt you may have to cards that offer no-interest for a period of time and then pay the debt off before the free period expires.
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