Cashback Card Do's and Don'ts

A cash back credit card is a great way to get some money back on all of your spending. However, before you jump on this rewards program bandwagon, its best to understand the Do’s and Don’ts of using cashback cards wisely.

Do make sure to compare cashback offers before you apply for a card. There are many online companies out there offering this type of program. Research your options so you can pick the right card for you.

Don’t ignore offers for other rewards opportunities. Some online cashback card programs offer cash or bonus points that can be redeemed for discounts on services or special items. These combination rewards programs can be beneficial to you as well.

Do make sure to pay off your balance every month. Rewards cards normally have a higher interest rate than other cards. Pay your balance on each statement, or try to get it as close to zero as possible. This way you will still get the cashback without having to pay for the high interest.

Don’t transfer balances from other cards to your cashback card. Initially, this might seem like a good way to get cashback on your old purchases. However, most online credit card companies will pay rewards on new purchases only. If you transfer your old balance, you’ll just end up paying high interest on those purchases without earning any rewards.

Do read all of the details of your rewards program before you start spending. Informing yourself on how and when you receive your rewards will help you use your card more wisely. Details can vary greatly between different cards. Some companies pay rewards once a year and others offer instant cashback. Many card companies offer extra cashback when you shop at certain retailers. Make sure to check your credit card statement or your credit card company’s website to understand the cashback card program.