Most credit card companies offer incentives for new cardholders. These are often long term low interest rates for balance transfers or 0% interest on purchases and balance transfers. These are attractive incentives for card holders who have debts that they want to manage effectively. Many jump from card to card, rate surfing to take advantage of preferential interest rates.

While most people want to avoid interest, low interest rate cards are not the best incentive for people who clear their card balance in full each month. If you're one of those people, then you will be looking for another kind of card reward. There are many credit card incentives that reward people who spend a lot on their cards and clear their balance every month.

Getting Cash Back Rewards

A cash back reward gives card holders a percentage of their spending back as cash. Some credit card companies add this up and apply it to the cardholder's account once a year. The amount of cash back varies depending on the card chosen. It can be 0.5% or much higher. For example, some cards give a cash rebate of ?1 for every ?100 spent (1%) while others offer as much as ?3 for every ?100 spent (3%). This is a very attractive card reward for big spenders.

Reward Points For Credit Card Holders

An alternative to cash back rewards is reward points. Many card companies offer points as rewards. Card holders earn points related to the amount they spend, so this is another type of reward that suits big spenders. Some card points schemes offer 1 point for every pound spent; others offer more. These are similar to the points schemes for supermarket loyalty cards.

Reward points can usually be exchanged for other incentives that might appeal to credit card holders. These include:

?discounts off food, wine, clothing and more

?vouchers to spend in online or high street retail outlets

?cash

Travel Related Credit Card Rewards

Many card companies also offer rewards related to travel. The most common of these is an air miles scheme. Air miles are points that can be collected so that card holders can earn discounts off flights and holidays. As with other reward points, card holders earn a certain number of points for every pound spent on the card. Once cardholders have collected enough points they can get free flights to different destinations. Some cards also provide upgraded travel insurance (valid for several trips) and passes to executive airport lounges.

Other Credit Card Rewards

One credit card reward scheme that is a bit different is the one offered by the GM credit card. This scheme allows card holders to earn cash to be applied to a car purchase. Since GM are responsible for a number of popular makes of car, this could be a good incentive for card holders who are likely to purchase a card soon.

Making The Most Of Credit Card Rewards

Credit card rewards are only useful if they offer rewards that people want, so card holders should choose a reward that matches their lifestyle. Card holders who want to go on holiday should choose a card that offers travel rewards. Those who like to shop might prefer to go for cards that offer discounts and vouchers.

As with other cards, it's worth paying attention to the annual percentage rate. While this is less important for people who clear their cards every month, it's worth thinking about how much interest you would have to pay if you didn't clear it. Some cards with rewards have high interest rates, but there are many that offer competitive rates. It is worth shopping around for one of these.