Credit cards have become the most prominent financial tool these days and everyone owns them. With a credit card you have the freedom to borrow funds whenever you feel that there is a cash crunch. From the humongous varieties of credit cards, you can choose to apply for a rewards credit card. You can consider applying for SBI SimplyCLICK credit card, IDFC First Select credit card, Axis Bank Select credit card, etc. from the best rewards credit cards. Hereunder are the few tips that you can use to make the most out of your rewards credit cards.
- Select the right credit card: To make the most out of your rewards credit card you need to select the right credit card first. You need to analyze your spending habits, requirements, and financial health before choosing a credit card. There is a wide range of best rewards credit cards among them you can definitely find a credit card that complements every factor in your profile.
- Earn welcome bonus: Some credit cards have a predefined condition that making the first transaction using a credit card for the first time lets you earn the bonus rewards. Don’t miss this opportunity and make the first transaction within a given time frame to make the most out of your reward credit card.
- Check for limited-time offers: From time to time merchant sites and card issuers provide a time-frame offer that you can avail of. You get to earn accelerated or more reward points on these offers as compared to the normal rewards program. Before taking these offers make sure that you actually need the product that is being offered. If it fits with your requirement and is affordable then you should not miss the opportunity.
- Pay your bills in full: One of the biggest credit card mistakes one can make is not paying the credit card bills in full and not on time. Carrying forward the balance of one billing cycle to another billing cycle will only attract high-interest charges. You can avoid this from happening by registering for the auto-debit services. You do not have to keep the reminders.
- Use cards for transactions that generate rewards: Know your credit card the best, which transactions help you generate reward points and which do not. Accordingly, use the credit card and make transactions. Do not use your credit card for transactions when you do not earn any reward points as you are only increasing your expense. You can use a credit card in an emergency. But make sure that your credit utilization ratio stays between 30% - 40%.
- Redeem the rewards timely: On credit cards, you get a limited time frame to redeem your reward points. The reward redemption time frame can be of 1 year or 2 years or 3 years as it varies from credit cards to credit cards. Make use of it and redeem reward points in that time frame only as after it you won’t be able to redeem them.
To summarise, the selection of the right credit card is the first step where you start to maximise the benefits of your credit card. If you do not select a credit card cautiously then it can create a hurdle in your way while using it as you won’t be able to enjoy the benefits as per your needs. The most important thing that comes with a credit card is using it wisely, paying the dues on time and in full, keeping the credit utilization ratio low, etc. It all depends on you how you manage your credit card in order to maximise the benefits.
Share your experience with a rewards-based credit card and how you maximise the benefits of it in the comment section.