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The Benefits of a Reward Credit Card
The Benefits of a Reward Credit Card

The Benefits of a Reward Credit Card

These days, many people use credit cards because of their ease, convenience, and flexibility.

There are different types of credit cards you can choose from these days, and the ones you are eligible for will depend on factors such as your income and credit score, among other things.

It is essential to choose the credit card that best suits your needs, so you need to do your research and choose carefully.

One type of credit card that has proven very popular over the years is the rewards credit card, and these are available from various providers and offer a range of rewards.

This includes travel reward credit cards, which are very popular, as you can see from this current Chase Sapphire Preferred review.

There are lots of benefits you can look forward to with these reward cards, some of which we will look at in this article.

1. What Are the Benefits?

To benefit from a reward-based credit card, you should use your card regularly, as the more you spend, the more you earn in rewards.

However, you should also make sure you repay the balance in full each month within the interest-free period, as otherwise, the interest can outstrip the benefits.

Some of the key benefits include:

1.1. Welcome bonus

When you get a new card, you may find you can earn a giant bonus if you spend a certain amount within the first few months after getting a new card. Never spend more than you would anyway because of a credit card, but you may want to stock up on gift cards for your favorite grocery store or retailer to put yourself over the hump.

Top cards offer as much as 100,000 to 150,000 point bonuses worth thousands of dollars in free travel. You will regularly find bonuses in the 40,000 points to 75,000 point range that are also quite lucrative.

1.2. Get Something Back

Many people end up paying them a fortune in fees and interest when it comes to credit cards. However, with a reward credit card, you can get something back using your credit card.

As mentioned before, you should repay the balance in full each month so that you do not pay fees and interest. By doing this, you can enjoy being rewarded for using your credit card, which is a bonus in addition to the convenience and ease that these cards offer.

1.3. A Choice of Rewards

There are lots of different reward credit cards, which means that you can benefit from a choice of rewards. So, you can find the ones that best suit your needs and preferences.

This includes credit cards that offer points toward purchases, cash back cards, travel rewards, and much more. You can earn rewards each time you spend on the card, and if you use it regularly, the rewards will add up surprisingly quickly.

In our huge list of websites and apps that pay people to refer their friends, we have a section dedicated to rewarding and cashback cards.

1.4. Earning for Spending

Using a credit card gives you a convenient and straightforward way of making purchases. You can use the card for both in-person shopping and making purchases online, which means you benefit from versatility as well.

With a reward credit card, you have the added benefit of being able to earn rewards for doing nothing more than using your credit card just as you usually would. This is a great way to pretty much get something for nothing.

1.5. Purchase protection

When you buy something and find the same item at a lower price the next day at the same store, it can be very frustrating. It is even more frustrating if the store won’t refund the difference back to your card. But with purchase protection, that is exactly what happens when you send in proof to the card issuer’s purchase protection company.

Some cards also offer an extension of the manufacturer’s warranty and offer item replacement if it is stolen or damaged within a short period after buying. I’ve read stories about people getting an iPhone replaced after breaking it within a few weeks of purchase. That is more than almost any card’s annual fee!

1.6. Fraud protection

Virtually every credit card offers fraud protection. If someone steals your card or card information and uses it to make purchases, your liability is limited by law. But most credit cards make your liability $0 for this type of fraud.

2. The disadvantages of rewards credit cards

Credit card rewards are hugely valuable, but it is easy to offset those miles, points, and cash back with expensive charges. Beware of these downsides of rewards credit cards if you carry one in your wallet or are considering adding one.

2.1 Interest charges

The biggest downside of credit cards is interest. Some cards charge up to 30% APR, which is a huge expense if you carry a large balance. If you want to use credit card rewards, you should always pay off your balance in full. Otherwise, the interest costs make it no longer worthwhile.

2.2 Annual fees

Annual fees are not fun to pay, but in many cases, they are worth it. Do the math to compare how much value you get from your card each year compared to the fee. If your annual fee is higher than what you get in return, you may be better off downgrading or canceling the card.

2.3 Late and missed payments

If you miss a payment, it is going to show up on your credit report. One random 30-day-late payment isn’t going to make or break your credit score, but a pattern of late or missed payments certainly will. A bad credit score prevents you from being approved for the best loans and credit cards, and if you do get approved might lead to a higher interest rate.

2.4 Cash advances

Credit cards are great for purchases, but you should stick with your debit card to get cash. A cash advance from a credit card typically charges both a one-time cash advance fee and a higher interest rate. You should avoid credit card cash advances in almost every scenario.

3. Find the right balance

Credit cards offer more good than bad if you keep your balances paid off and avoid unnecessary fees. Be honest with yourself and only use rewards cards if you will diligently keep the balances paid off. If not, they probably are not worth it for you.


As you can see, there are lots of benefits that come with using reward credit cards. This is why they have become such a popular option among so many people.

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About Stephan

Stephan J is the founder of and is making a living exclusively online since 2004. He tried and managed to make good profits on everything from Forex trading, options, website flipping, adsense, affiliate websites.His passions are cycling, fitness and he is spending a small fortune on watches and fine cigars

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