These days, almost everyone uses several types of credit cards for their daily purchases and even when paying their bills. There is no question that it has become an integral part of our lives, offering convenience and, much later, rewards. One of the many rewards a credit card can offer is the cashback reward, where consumers have the chance to earn some money back for their expenses.
But are you really getting the most out of your cashback credit card?
Here is a comprehensive guide to show you how to maximize your cashback rewards best, tailoring it to your lifestyle. We will also explore some clever cashback credit card tips. To guide you on the best available credit cards and the technical knowledge you need to have, here’s a link, kredittkortinfo.no/cashback/, that could help.
Quick Link:
Maximize Cashback Rewards
Got approved with a cashback credit card, and now you are ready to use it? Great! You would think getting some sort of discount on your purchases is all there is to it with a cashback credit card, but you could not be more wrong. Although it promises a straightforward way to earn back on most of your expenses, there is more to it than a 1% back into your deposit account after a dollar expense at a convenience store.
Here is what you need to know to get the most value for every purchase:
- Cashback varies among specific types of purchases. Although it differs from the credit card issuer, cashback often has varying rewards rates depending on how you use it. Some cards give higher cashback percentages on groceries, others on your shopping sprees, and some prioritize travel expenses. Review the reward structure of your card and use your purchase limit strategically. If you have a card that offers at most 3% on groceries, prioritize those expenses in using your card.
- Be updated on your card’s bonus categories. Credit cards often offer bonus deals for a limited period. These deals typically consist of higher cashback rates when the credit card is used for a specific type of purchase in a certain period. For instance, when your card announces a 5% cashback on travel purchases, maybe it is time to plan and book flights and accommodations for future travels.
- Optimize cashback rewards by combining multiple cards. Some people choose to have a variety of cashback credit cards as they serve different purposes. By strategically using multiple credit cards according to your purchases, you are ensured to get the maximum cashback for every type of purchase. This, however, poses a challenge to your ability to track and pay for your cards on time. Be sure to be consistent and efficient with your expenses and payment trackers, or you will face potential risk with your credit scores for overdue payments. Reduced credit scores often lead to a lower possibility of discounts and higher interest rates on your other credit products.
Earning great rewards and cashback rates is good until you start overspending. Remember, cashbacks are only good if you earn from an expense that you actually need. Do not spend more than you can pay or need just because of a promise of better rewards; that basically just defeats the purpose of earning your cash back.
Cashback Credit Card for Different Lifestyles
While a one-size-fits-all credit card is far from a pipe dream, it usually offers a lower reward rate and is consistent across all purchases. Flat-rate cashback cards do not discriminate on any transactions. If you are one to use your credit card for almost everything and hate keeping up with the always-changing reward categories that a bonus or rotating category card offers, then this one is for you.
On the other hand, if you are particular about the perks and rewards your credit card can offer, then a tiered bonus and rotating category cashback cards are perfect fits.
It is important to plan how you want to use your credit card, especially if it is your first time applying for one. There are several types of cashbacks available in the market that are designed for specific demographics and interests. If you know what card to get, you will be able to enjoy doing the things you love with less guilt.
Here are some that you can refer to:
- Credit Cards with Cashback for Family Expenses. If you already have a family, a big one at that, a card with high cashback rates on daily expenses, such as groceries, gas, and even childcare, is one for you. This way, your earned returns grow with your expenses, and in a way, allows you to offset the costs of your day-to-day life.
- Credit Cards with Cashback for Travel Expenditures. If most of your life involves being always on the go, then travel cashback cards are the way to go. For every purchase of flight tickets, hotel rooms, or even car rentals, you get to have some of those costs back. When traveling abroad, there are even some cards that offer higher rates and lower conversions.
- Credit Cards with Cashback for Dining Experiences. For foodies, a cashback that offers high rewards for dining out or getting takeouts is definitely made for you. This card rewards you for your restaurant escapades or even when you are too lazy to cook and decide to order in. This allows you to enjoy those gastronomic dishes without any guilt.
Now, you know what cashback offers to look for to cater to your own lifestyle. You need to know of other factors that can help you even more in making the best choice:
- Take notice of the annual fees. Although most cashback cards offer low or zero introductory annual rates, you need to pay attention to their ongoing APRs. See if your annual rate just wipes away the rewards you gain from your purchases. Learn to calculate the value of your cashback against the card’s APR.
- Check the length of Interest-Free credit. Be wary of your credit card’s grace period, of the time between your statement closing and the date when your card is due for payment. If you pay within that crucial period, you will not incur any interest charges on your purchases. It varies by card, so if you have multiple cashback cards, you need to keep records of their grace periods accurately.
- Do not underestimate the currency surcharge. For those who use their credit cards for purchases in foreign countries, make sure you know about the currency surcharge or foreign transaction fee on top of your conversion rates. Typically, it is a percentage of the total transaction amount and covers the cost of conversion. Again, this varies with the credit card, with some having no transaction fees at all.
Helpful Tips and Hacks for Efficient Cashback Card Usage
Now that you have learned how to maximize your cashback credit card fully, it is also worth knowing some helpful tips that can help you go beyond the cashback rewards.
- Stack up your cashback offers with coupons. While cashback is a great reward in itself, there may be an option for you to use it together with coupons, cashback offers, and discounts from retailers. It is important to take note, though, that there are additional ride-on options that you can enjoy but may not always be available.
- Learn to plan ahead and time your purchases. If you are one to enjoy research, then looking up which categories are offering the most cash back and when on your credit card may be a worthwhile activity to pass the time. This way, you can time your purchases, so they align with available special promotions, and holiday discounts, and allow you to earn more cashback.
- Use the digital platforms to your advantage. There are many cashback portals or websites that offer rewards for your online purchases. Check out reliable cashback portals like Rakuten or TopCashback and see if your preferred retailers partner with them. These websites would require you to click through them so the cashback can be applied. If you do not want the hassle, then downloading cashback apps or browser extensions is also a great idea.
The knowledge of these helpful tips can arm you with the potential of earning more than what you spend. The bottom line, though, is ultimately choosing the right cashback credit card that works best for you. So, employing the best methodologies laid out in this article in maximizing your cashback credit is, in itself, a rewarding financial journey.
