The very first credit card was the Diners club card, which was created by Frank McNamara in 1950. From there many companies, stores, and banks began offering credit cards. These credit cards gave the cardholder the ability to purchase on credit and pay it back at a later date with interest payments added if the entire balance was not paid on time. Not only did this give the customer the freedom to have credit, but they also did not have to carry around large sums of money and could purchase larger items and pay for them later. In 1996, the rewards credit cards hit the market.
Today, you can find all kinds of rewards credit cards. Discover was the first to offer a rewards credit card, which gave the cardholder the chance to receive a percentage of their spending to be returned to them in the form of rebates. This is similar to the cash back rewards credit cards that you see everywhere. The cardholder can receive a percentage back on some of their purchases either monthly or yearly, however, you must purchase at the stores or type of stores the credit card company offers the with their cash back policy.
Next, in line was Continental Airlines that began to offer frequent flier miles. Now, every airline and many major credit card companies have jumped on these rewards credit cards, each with their own special incentives to use their credit cards. For every purchase, you make with the air miles rewards credit cards you accumulate points, these points can then be transferred into air miles. The air miles can be used for airline tickets, hotel accommodations, and car rentals. Some however, only allow certain airlines, hotel chains, and car rental agencies. Many times other fees such as membership fees and higher interest rates can be applied. Be sure you learn when the points you accumulate will expire or any applicable black out dates.
Many people prefer rewards credit cards that fit their lifestyle such as saving points for a trip to the Super Bowl, paying off your mortgage, visiting Disney Land, or taking a cruise. No matter what you would enjoy to do with your reward points, you are sure to find rewards credit cards with you in mind.
There are however, limitations on most rewards credit cards. Once you get the most points available that is it, you are no longer eligible for the benefits offered by the rewards credit card. Another thing to consider is that all points you receive are calculated on how much you spend. The more you spend the more points you will earn. Be sure that you are not just spending to earn a terrific prize, you maybe able to purchase that prize for quite a bit less if you saved for it instead of spending more and paying interest to earn it. You will more than likely be paying more annual fees and even transaction fees to redeem your points into rewards.
With the convenience of online account management, you can easily access your account and make your payments through the internet. You can pay your telephone bills, cable, electricity and other monthly utilities as well as your monthly mortgage or your retirement fund through your reward credit card. This lets you earn more points and at a faster rate as well.
Reward credit cards also give you unlimited options on how you want to be rewarded. You can exchange your points for a free travel ticket, concert ticket, a hotel accommodation, free restaurant meals, appliances, and other purchases. You can even choose to contribute your rewards to your favorite charitable organization. Truly, reward credit cards have come a long way since Discover started it back in 1980.
How can you maximize your benefits from your reward credit card? Consider the following suggestions:
Avoid carrying a balance. The rewards you earn from your purchases may just as well go to waste if you have to pay for a very high interest on your credit card bills. Why? Because reward credit cards have higher interest rate than non-reward cards. Therefore, if you want to make your reward credit card work for you, avoid carrying a balance. Don't spend more than what you can afford to pay for the month. Also, remember to submit your monthly payment on or before but NEVER later than the due date.
Know your card's affiliates. Reward credit cards have partnerships with hotels, airlines, stores, gas stations and other establishments. Whatever type of rewards credit card you have, you need to be aware of which companies does your credit card have affiliates with. Some credit cards only award points if purchases are spent from an affiliate merchant.
Even if your credit card gives points regardless of where you shop, it is more likely that you'll get higher points or higher rebates if you use the card from an affiliate. Thus, it is also a good idea to choose a reward credit card that has partnership with your favorite establishments.
Know your boundaries. Usually reward credit cards impose restrictions with regards to earning points. For example, some credit cards impose a maximum amount of reward that a card holder can claim. After that, you will not be allowed to earn more regardless of how much you spend on the card.
It would work to your advantage if you know your limits so you can do the necessary steps needed before your rewards go to waste. If you think a particular credit card imposes unreasonable limits, then don't waste your time signing up for that card. There are many credit card companies that give better deals and do not impose a limit on the rewards you can earn.
Both Robert Alan & Ann Wilson are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
Robert Alan has sinced written about articles on various topics from Credit Cards, Business Credit Cards and Credit Cards. For more on the different types of , Robert Alan recommends that you visit CreditCardAssist.com.. Robert Alan's top article generates over 110000 views. to your Favourites.
Ann Wilson has sinced written about articles on various topics from Student Credit Cards, Credit Cards and Airline Credit Cards. provides consumers with valuable reviews and information. Ann Wilson's top article generates over 14800 views. to your Favourites.