HomeBlogRewardsCredit Cards With Rewards : How Much Money Can You Really Make?


Credit Cards With Rewards : How Much Money Can You Really Make?

by / 0 Comments / Mar 09, 2015

Yes, credit cards with rewards can make you money. The prospect of borrowing money from a credit issuer and earning money instead of paying it out can be quite exciting. But how much can you really come out ahead? Here are the best-case scenarios, which may motivate you to obtain a credit card with rewards, and use the program to your advantage.

  • Cash-back: The first example is for a card that comes equipped with a cash back rewards program. If you regularly charge expensive items, you could earn a tidy sum. Let’s say you put $60,000 on the card in one year, and the bank that issued the card gives 1.75 in points for each dollar you spent. (A “point” is one percent.) With a simple math equation, you’ll discover that just over a grand would be yours to play with ($60,000 X 1.75% = $1,050). And that’s for a low point value. Many issuers give five points for each dollar charged when you use the card to pay for such things as dining out and airfare.

If charging such high sums sounds crazy or not doable, think again. It’s amazing the expenses you can charge on your card these days and when using credit cards with rewards you truly can earn money. Not long ago, you couldn’t use a credit card for large, recurring bills like rent and college tuition. But times are changing. Many schools and colleges accept plastic, as are an in-creasing number of property owners. It’s certainly common for tuition to cost over $20,000 per semester, and for monthly rents in high-demand areas to exceed $2,000 per month. Simply by paying your child’s education and your own housing costs using credit cards with rewards could reap enough rewards to cover the cost of a swank weekend vacation in about a year.

For another example, consider what you can get with points transferable for airline travel. The points start accumulating when you begin your relationship with the creditor. Much of your bonus comes from the original number of points you get when you first acquire the card and promise to use it in a specific way.

  • Credit Cards with Rewards: Getting Points. Depending on the card, you can earn as many as (and in some cases more than) 100,000 points by charging a mere $3,000 in the initial three months. Those points are worth big money. Typically, that number would translate into about $1,000 or more toward airfare or hotel expenses.

All for what? Paying for the things you can afford. That’s the key, of course. To make sure credit card rewards programs are worth it, and that you’re putting free cash in your pocket and complementary trips in your life, you’ve also got to be dedicated to charging aggressively. To avoid canceling out the benefits of the rewards by paying high interest expenses, you’ll want to do so while also staying out of debt.

Are credit card rewards worth it? I think so and I hope you’re inspired to use credit cards as an enhancement!

About the Author

Erica Sandberg is a renowned personal finance editor, advice columnist, and reporter. She hosts her own video program, Making it with Erica, and is a frequent guest on national news shows, from Fox to CNN. Her book, Expecting Money: The Essential Financial Plan for New and Growing Families was the first to address the specific financial needs of new parents. Erica is the spokesperson for some of the finest businesses and products in the U.S., including Western Union, the Better Business Bureau, Bank of America, CVS Pharmacy, Michael Minna Restaurant Group, Bounty paper towels, Chase Card Services, and Assurant Solutions. Prior to her her current journalism career Erica was affiliated with Consumer Credit Counseling Service of San Francisco for ten years.

Ask the author a Question

Leave a Reply

Your email address will not be published. Required fields are marked *

Copyright © 2014 Credit Cards . All rights reserved.

Advertiser Disclosure: The credit card offers that appear on CreditCardIdeas.com are from credit card companies from which this site receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). This site does not include all credit card companies or all available credit card offers.

Editorial Disclosure: The editorial content on CreditCardIdeas.com is not provided by any bank, credit card issuer, airlines or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.