How to maximize your cash back credit card rewards points
If you have found a great cash back credit card, you’re in luck, as these cards can be nice bonuses to your finances. If used appropriately, they can help pout some extra money in your pocket, provided you are appropriately efficient in how you spend. There are many ways to maximize these credit card rewards. Here’s a look at how.
Get That Welcome Bonus
Many cards offer a welcome bonus that can equal hundreds of dollars in cash back rewards, provided you make certain expenditures over a period of time. These bonuses are usually well worth acquiring, even if it means moving away from other cash back cards temporarily. Track your expenses, and make sure you get that bonus. Once you do, you can change your spending pattern back to a normal strategy of spending.
Fully Understand Your Rewards Policy
The truth is that you cannot maximize your rewards if you don’t know what they are. Is your card a 1% cash back on all items? Are there extra bonuses in certain categories? Do you have other cards that you should use for these categories, like gas, groceries, or restaurants? Are there limits that you risk exceeding? Furthermore, when do these points get redeemed? Some cards redeem points after you make a payment, but others redeem half of the points when you actually incur the expense, and the other half on payment. Make sure you fully understand these issues before you begin to set up any pattern of spending.
Set Up Your Bills
Some cards have it so that you get a bonus if you set up recurring bills with these cards, like Netflix or Hulu. Make sure to fully investigate whether or not this is the case with any of your cards, and once you do, set up your cards accordingly. This way, you can get even more money back for paying a bill that you would have paid anyway.
(Responsibly) Look for Opportunities to Increase Expenses
To be clear, you should never spend more money for the purpose of getting more rewards. This will not get you any money back and will cost you huge sums in the end. However, there may be ways for you to spend more money and earn more points without actually increasing your expenses. For example, can you spend more money on a cash back card for which you will ultimately be reimbursed? If this is the case, you should absolutely do so. As long as you have the money to pay all of your bills and be quickly reimbursed, this will allow you to essentially earn free points and get more cash back without increasing any expense to your wallet.
Monitor for Changes or Limited Bonuses
Sometimes, as part of an effort to churn up business, a credit card company will offer a limited time bonus on expenses of certain categories. They will usually Email you or mail you when this is the case, and you should make sure to keep a close eye out for these Emails, as they can be huge for increasing your bottom line. Watch for this communication, and adjust your spending pattern as appropriate.
Pay Your Bill On-Time
Remember, being offered a cash back credit card doesn’t change the terms of your payment. Make sure to always pay your bill on-time, and pay it in full if you can. This ensures that you will maintain good credit and retain access to these lucrative bonuses. Remember, too many late payments can not only hurt your credit, but it can cost you access to these bonus reward points.
When it comes to maximizing your cash back rewards, remember, virtually nothing that you will do once is going to earn you huge sums of money back in a very short period of time. Instead, you’re talking about a few dollars every week. However, maximizing your personal finances is about hitting a bunch of singles, not a grand slam home run. Over time, these little changes will add up to big savings.