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The Best Way to take Advantage of Cash Back Credit Cards

Credit Card Rewards

Cash back credit cards are a great product that millions of Americans have taken advantage of over the years. However, like any other kind of credit card offer, you must understand the concept behind cash back credit cards if you expect to come out ahead.

Cash back credit cards, in general, are very good credit card products for individuals who charge consistently and also pay off their balances each month. Because it certainly doesn’t make much sense earning cash back on a purchase that you are likely paying more for in finance charges.

Cash back credit cards are essentially an opportunity to earn free money; you just have to know how to do it:

• Compare cash back credit cards to determine which one best suits your spending habits and which one offers the most competitive cash back terms. It is important to remember that all cash back credit cards are not created equal, so it will benefit you greatly to do your homework when it comes to choosing a cash back credit card.
• In order to really start earning cash back rewards, you must start charging your everyday purchases. The consumers who really make out in the cash back credit card rewards game are those customers who make a habit of charging nearly all of their purchases – and paying those purchases off when their bills arrives.
• Don’t forget to keep close track of your spending habits on a cash back credit card. Like I mentioned earlier, the only way to really use a cash back credit card to your advantage is to pay off your bill at the end of the month; however, if you charge a lot during the course of the month you may not be able to pay your bill in full. This is why it is important to keep a close track of your monthly spending so you don’t end up carrying a balance over from month to month.
• Pay close attention to the terms and conditions regarding your cash back program, as they often come riddled with exceptions and rules. Make it a point to fully understand the card’s cash back program so that you can enjoy your cash back rewards without any penalties.

Finding the Best Credit Card Offer: do you Know What you’re Looking for?

Choosing Credit Card

Even with the unsteady state of the credit card industry, there are plenty of credit card companies and credit cards from which to choose. For someone looking to get a new credit card, the process of finding the card that’s right for them can be downright confusing.

Given all of the credit card options available, how can you be sure you’re getting best deal and the most competitive rates?

Well, the first thing you can do is use the Internet to research and compare the top credit cards by each credit card company. However, there are several other factors that you may want to look at next time you are considering applying for a new credit card:

• Read the fine print when it comes to cards boasting a zero percent interest rate. More importantly, find out whether this zero percent rate is fixed or variable, and whether it is simply a promotional or “teaser” rate that will last just a few months. Many consumers fall into the zero-percent-interest trap, only to be stuck with a high interest rate once the promotional rate expires.
• Look further than just the interest rate. A credit card company could offer you a fantastic interest rate, and then sock you with outrageous fees. Check to see if the credit card company charges an annual fee for the card; also, check the card’s fees and penalties for cash advances, late payments and over-the-limit fees.
• Make sure the credit card you choose has a grace period. Some credit card companies charge interest from the moment you make a purchase, while others offer consumers a grace period during which they can pay off the card with no interest charges.
• Look beyond rewards and perks. Some consumers are drawn into using a credit card simply because it offers them some type of reward program or perks for using the card. However, what many consumers fail to realize is that the rewards they think they are earning are merely being trumped by high interest rates or other fees and charges. In other words, make sure you are not paying out more simply to earn rewards points.

What you don’t Know Might Hurt you: Important Questions to Ask before Signing up for a Credit Card

Choosing Credit Card

A credit card offer that seems too good to be true may be just that.

If you have a good credit scores you are likely inundated with a number of credit card offers during any given month. It therefore becomes increasingly difficult to sort through these offers and decide which one is right for you.

Although the process of weeding through your credit card offers can be arduous and even overwhelming, it is important to recognize that a great credit card offer may not be all that great once you begin to peel back the layers of the credit card’s terms and conditions.

It is therefore in your best interest to ask yourself the following questions before signing up for a credit card. If you can’t find the answers to your questions or if you have trouble deciphering the often hard-to-understand legalize used in the small print, then by all means contact one of the credit card’s representatives for answers. Most importantly, never sign up for a credit card if you don’t completely understand all of the card’s terms and conditions.

Questions you Need to Ask Yourself Before Signing up for a new Credit Card:

• If there is an introductory rate, how long does it last and what will my rate be once the introductory rate has ended?
• Are there any application or processing fees associated with signing up for this card?
• Is there an annual fee for this card?
• What are the late/over-the-limit fees?
• Is there a fee for balance transfers? What is the interest rate for balance transfers?
• Is the rate on this card fixed or variable? Under what circumstances will my variable rate change?
• Do I have the option of paying my bill online? What online services/features does this card offer?
• On what date will my statement be sent out each month? How many days do I have each month to pay my bill (i.e., what is the billing cycle)?
• What are the details of the card’s reward program?

Should I Take Advantage of a 0% Interest Rate Balance Transfer?

Choosing Credit Card Credit Card Types

We’ve all received those tempting offers from credit card companies offering a 0% interest rate on balance transfers. Sounds enticing, doesn’t it?

Well, credit card companies are betting on it. Don’t get me wrong – 0% balance transfer offers are a potentially excellent credit choice; but they may also come with terms and conditions that could turn around and bite you if you don’t stay on top of things.

How do they Make Money?

It only makes sense that a credit card company can’t make anything off of customers who take advantage of 0% interest rate offers, right? Wrong! The credit card company is betting on the fact that the majority of credit card holders will be unable to pay off their credit card balance during the 0% promotional rate. In other words, the credit card company may not make anything off of the credit card holder at first, but it is only a matter of time before they start making money.

How Long does the Promotional Rate Last?

Which brings me to the next point: 0% credit card balance transfer rates are rarely for the life of the loan! Upon further inspection, you will find that most credit card balance transfer offers are only good during a short, promotional period, which is typically between six and 12 months. At that point, the credit card’s interest rate will likely significantly jump.

In fact, some credit card companies may raise interest rates upwards of 18 percent once the promotional rate has expired. And this is where reading the terms of the credit card balance transfer offer becomes so important.

There are many credit card holders that accept 0% balance transfer offers, only to ignore the length of the promotion. And then, before they know it, they have been paying a 15 percent interest rate on their large balance!

What about Balance Transfer Fees?

Many of us are so excited to receive a 0% balance transfer offer that we automatically accept the offer without looking further into it. The two things that you should take special notice of include the interest rate once the promotional rate has expired, as well as the balance transfer fee.

Huh? A balance transfer fee? Yep, this is another way credit card companies make their money. Many companies charge a fee to transfer a balance, and this fee often ranges between one and three percent of the balance of the transfer.  Most credit card holders find that this fee is reasonable, considering the money they will save on interest rates, but it is definitely something to look further into when accepting a 0% balance transfer offer.

The bottom line with 0% balance transfer offers is that they can certainly prove beneficial to credit card holders who carry a balance on their cards. However, it is still important to work hard and pay off the debt as to avoid future finance charges. Check the balance transfer’s terms, including the promotional rate and the balance transfer fee, so that you can make the most informed decisions regarding your credit.