If you’re new to using rewards credit cards or are simply looking to get more out of your rewards credit card in a responsible and efficient way, here are nine things should you know.
# 1 – Understand Your Card
Before you can maximize your credit card rewards you first need to understand your card. Credit cards come with all kinds of different terms, rewards, and fees.
Here are some things you should look for:
- What kind of rewards you can earn
- The spending required to earn rewards
- How to redeem your rewards
- Annual fees
- Minimum spending limits
- Rotating categories
The type of rewards you want to earn will determine what kind of card you should sign up for. If you’re an avid traveler you’ll want a card that offers flight and hotel rewards options. If you want to rack up some cash for Christmas shopping you’ll want a good cashback card.
Make sure you fully understand your card and the requirements for earning and redeeming.
Also, if you’re a light credit card user you’ll probably want to avoid cards with annual fees as they could completely wipe out all of your rewards. The Discover it® card, where you can earn cash back, and the Discover it® Miles card, where you earn 1.5x Miles on every dollar spent, both have no annual fee. If you’re a heavy credit card user an annual fee could possibly be worth it depending upon the card.
# 2 – Meet Minimum Spending When Required
Many credit card companies will offer you bonuses for signing up for a new card. These bonuses generally come with minimum spending limits that need to be met in a certain timeframe.
If you’re taking on a new credit card to get the sign-up bonus make sure you’ll be able to easily meet the minimum spending requirements.
In addition, you should also look into the rewards after that bonus is redeemed. Make sure those future rewards options align with your interests.
# 3 – Buy through Shopping Portals
If you want to easily rack up more credit card rewards check and see if your credit card company has an online shopping portal such as the Discover Deals portal.
These shopping portals work just like cashback websites only you may be able to earn extra rewards by going through the one operated by your credit card company.
# 4 – Use Apple Pay with Your Discover Card
If you have a Discover Card an extremely easy way to amass more cash back is to use your Discover Card with Apple Pay.
Through the end of the year (2015) Discover cardmembers will earn an automatic 10% Cashback Bonus®, on in-store purchases made with their Discover card using Apple Pay.
Discover it Miles, Miles and Escape cardmembers using Apple Pay will be eligible to earn an extra 10 Miles per dollar on in-store purchases.
This a great level of extra rewards if you’re a Discover cardmember.
# 5 – Spend on One Card
If you want to really maximize the amount of rewards you earn then focus on one card. When you spread your spending among multiple cards it can dilute your earnings.
Spend on one card to accumulate more rewards.
# 6 -Be Sure to Opt In to Bonus Reward Categories
Many companies will require you to opt into bonus categories. To do this simply log into your credit card account online and opt in to the bonus categories if applicable.
This will only take you a few minutes but will ensure that you’re earning the most rewards.
# 7 – Use Your Card to Pay for Regular Expenses
It would be counter intuitive of you to spend extra money just to try and earn more rewards. Instead, just charge your regular expenses to your credit card.
Try paying your regular bills (like utilities, phone, or internet, if possible) as well as groceries and gas with a credit card. By using your credit card to pay your routine expenses rather than using cash or check you can potentially earn a ton of rewards for very little effort.
# 8 – Redeem Your Rewards on a Regular Basis
Many companies will put an expiration on your credit card rewards. To avoid having all of your rewards go down the drain redeem your rewards on a regular basis.
Mark your calendar to check and redeem rewards on a quarterly basis.
# 9 -Always Pay Your Bill In Full & On Time
I hope this goes without saying, but I’ll say it anyway. If you’re trying to accrue credit rewards but don’t pay your bill in full and on time each month the interest you’ll be charged will far outweigh the rewards you’re earning.
Use your credit cards responsibly. Only charge what you can pay in full each month and be conscious about not spending more just because you’re paying with plastic.
Thanks to Discover for sponsoring this post. All opinions are my own.
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him on the About Page, or on his personal site RobertFarrington.com.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.