When it comes to credit cards, it’s important for people to know the different types of rewards and benefits they offer.
If you don’t use yours responsibly, you can easily find yourself in debt in a short amount of time.
However if they’re used properly, there are plenty of ways cards can help you earn rewards.
Here we spoke to Nathan Grant, Credit Industry Analyst with Credit Card Insider, who revealed the simple methods to gain value from your card.
He told Daily Star Online: “In general, the better your credit is, the more you could be able to qualify for cards that earn more rewards and provide more benefits.
“Points, miles and other cash back rewards are some of the best reasons to be a cardholder.
“What many don’t realise is that despite all the credit card options, you can benefit by picking the best card that fits your spending lifestyle.
“For example, some people may get a travel credit card – but only travel once a year.
“Using a credit card for everyday purchases can earn you more value back than you paid, as long as you pay the balance back in full and on time every month.”
Nathan revealed five simple tips to earning money from your credit card:
1. Signup bonuses
Some credit cards come with introductory signup bonuses. These bonus offers can provide excellent value, with returns on spending range from around 20% on average to more than 50% in some cases.
Usually, you have to meet the spending requirements within a specified period of time, such as three months after opening the card.
While it's not a reason to get a credit card and start spending, if you know you're going to spend that amount in the allotted time, through an expected big purchase or with your everyday spending, it can be a nice and rewarding way to earn additional money back.
2. Points and miles
Earning rewards through points and miles on certain credit cards might not sound like monetary rewards, but depending on the card you can redeem those points accrued for things like statement credits and travel expenses.
These are generally travel credit cards and are a great way for experienced, responsible cardholders to earn money from expenses they make already.
3. Cash back
Using a cash back credit card for everyday purchases earns you a percentage on each purchase.
These cards can also earn you higher percentages back in certain areas like gas, groceries and restaurants.
4. Use credit card benefits in Tandem with Card Rewards
You can save money beyond cash back or rewards points through some of the benefits different categories of credit cards offer.
If you’re a frequent traveler, certain travel cards offer complimentary baggage fees, WiFi access, foreign transaction fees, travel insurance and lounge access.
Depending on your card, there are other great benefits that card issuer’s provide their cardholder’s including: emergency roadside dispatch, extended warranties, price protections, event ticket protections, and concierge services for booking trips or making reservations.
5. Securing your finances
Credit cards give you an added element of security over debit cards and cash as well, and this can save you money indirectly.
If any fraudulent activity appears on your credit card, criminals are actually spending your credit card issuer’s money.
When criminals fraudulently use your debit card, they’re spending your money from your checking account. With a credit card, you’ll have time to report and manage the fraud before your due date.
However with a debit card, once the money leaves your account – whether the charge is fraudulent or not, it might take weeks or months to get your money back.
That could cause you to miss important bills or put strain on your budget elsewhere.
