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Comparing reward credit cards can often be a difficult task, particularly when encountered with a lot of options. Some people are quickly tempted with the promise of big rewards which they tend to neglect the small details. These information can have a big effect on your credit card use afterwards. In this article, let’s talk about some important issues that you should comprehend before you sign up for a reward credit card.



On Introductory Offers

It’s great when a credit card makes an introductory offer such as a low rate or zero APR within the first 6 to 12 months. While this is an enticing offer, don’t forget that the low rate or 0% APR is not meant to last very long. Find out what the real APR is when the introductory period ends. If you do not check this simple fact, you might be surprised to discover later on that you’re stuck with a high-rate rewards credit card anyways.

On Paying Balances

Will you be able to pay off your full balance each month? This is a personal question that you must consider before acquiring a rewards card. If you have to carry a balance from month to month, you might end up paying more on expensive interest rates and late fees. Paying the extra fees may defeat your purpose for acquiring a reward credit card – which is to save money and get rewarded.

Terms and Conditions

Before signing up for a reward credit card, it’s important to be aware of the terms and conditions. Take the time to read each and every statement of the Agreement. If there are statements that seem unclear, do more research and consider how it will affect your credit card use.

Your Personal Credit

Your personal credit rating is another matter. Take note that some reward credit cards are exclusively for people with good credit history. If you have below average credit rating, your application will undoubtedly get rejected. Getting declined by a creditor will cause your credit score to drop even more, so it’s important to be very careful when submitting credit card applications.

Type of Reward

There are different types of reward credit cards on the market. The most popular are Cash Back Rewards, Airline Miles Rewards, and Gas Rewards credit cards. Which reward credit card should you pick? You should always pick the one the best complements your spending style and needs.

For instance, if you are a frequent traveller, then you can surely benefit more from a travel reward credit card. However, if you do not travel a lot, a cash back credit card might be the best option. Do you drive a car? If yes, you may consider a credit card with gas rewards to save more on your gas expenses.

Maintenance Costs

How much will it cost you to keep your reward credit card active? How much is the annual fee? If you have to pay $100 a year to maintain your membership with the rewards program, do you think the credit card is still worth keeping? Are you truly being rewarded or are you spending more on fees?