As you learn about the many available loyalty reward cards, it becomes evident that not all rewards are created equal. Different purchase categories earn different rates of return for cash back, points and miles. Some rewards cards focus on specific categories and are identified by this focus, such as travel rewards or business cards. Others are more generalized and offer higher rates on specific purchases, and some of these change their high earn rate categories on a rotating basis.
Your typical rewards card will offer points, miles or cash back for general purchases like shopping, restaurants and entertainment. In many instances, your best earn rate for these categories will be realized when you shop at a card issuer’s online mall/shopping portal. In many instances you don’t even have to use their loyalty reward cards to shop there. Instead, use a card that maximizes rewards and/or perks. A good shopping rewards card comes with additional valuable features like purchase protection and extended warranties.
Travel loyalty reward cards offer a better rewards earn rate for travel-related purchases, such as airfare, hotel stays, cruises and car rentals. Several of the best reward cards also offer perks associated with travel. This includes complimentary upgrades, flight accident insurance, priority passes, baggage insurance, in-flight purchase discounts, priority check-in and boarding, and concierge services. Many good travel rewards cards do not charge foreign transaction fees either.
3x earn rate on your points for flights booked directly with the airlines. 2x earn rate on gas and groceries. Points can be used for travel, merchandise, entertainment and gift cards. It offers additional travel benefits, like roadside assistance, rental car insurance and travel accident insurance. This is a charge card, not a credit card, so there is no balance, nor interest rate. It charges a 2.7% foreign transaction fee. The $175 annual fee is waived the first year.
You don’t need to limit yourself to branded gas cards to reap benefits for your gas purchases. With so many options available, you can realize high earn rates and save at the pump with a major loyalty reward cards. Just look for a higher than 1:1 ratio on gas purchases and check for an annual fee.
3% cash back on gas and 2% on grocery – eligible purchases capped at a combined $1,500 total each quarter. 1% after that and on other purchases. No Annual fee.
These credit cards offer rewards targeted to the small business owner, often incorporating several features from other rewards programs. Typical important rewards categories for the business user are office supplies, airfare, gas, hotel stays, and phone and internet services. Other features of value include fraud alerts and tailored spending limits for different authorized users.
5% cash back on purchases (up to $25,000 annually) at office supply stores, on cable tv, phone service (mobile and landline) and internet services. 2% cash back on purchases (up to $25,000 annually) at restaurants and gas stations.
If you want more variety out of your rewards card, rotating categories may be the answer. These cards change the spending categories that earn the max rewards rate every 3 months.
For a top credit card reward, get 5% cash back on select purchasing categories that rotate each quarter. For example, from mid-July to mid-September 2014, you earn 5% cash back on purchases at Kohl’s and at gas stations. From mid-September to mid-November, the categories change to Amazon, Zappos and select department stores. The 5% rate only applies to the first $1,500 in combined purchases during each quarter. All other purchases earn unlimited 1% cash back.
For the most rewards impact, select the rewards card that offers the best earn rate in the categories that are already important to you. This way you get cash back or earn points/miles for purchases that you already typically make, and this results in smart savings for you.
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