Credit Card Rewards

Updated on April 12, 2012
A.S. asks from Glendora, CA
17 answers

Does anyone take advantage of credit card rewards and is it really worth it? I got an app for an American Express airline miles card and after looking at how much it would cost our family of 4 to travel to visit family this summer I am tempted to get one but I feel like there has to be a catch or something. It says there is no annual fee and a 0% APR for 12 months and if you spend 500 in the first 3 months you get a bunch of bonus points. I am not looking to increase my credit card debt so I would use this card for the points only and pay it off monthly. Do you still accrue the points even if you never pay them interest? Thanks!

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answers from Phoenix on

i hear it takes a lot to get travel out of it. We do chase rewards and after a few thousand here and there, we cash out some gift cards for dinner and shopping. Works for us.... little bonuses.

4 moms found this helpful


answers from Minneapolis on

I do use my rewards but usually just get the cash back. Am Ex does charge an annual fee probably after that first 12 months and it takes a lot of points to get free travel. I would maybe find out how many points you need for a free ticket and determine if you would spend enough in a year to accumulate the points you need. I do know that those rewards tickets come with some limitations as well. Yes you still accrue points on every dollar spent and sometimes they run special offers where you get double points on gas or groceries.

2 moms found this helpful

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answers from Dallas on

We use one of the Chase cards and we run all business expenses, etc through it. We do travel a lot and have a lot of business expenses so our rewards add up pretty fast. We also refuse to pay an annual fee for a card. Never have and never will. You can negotiate that... we are in business and I negotiate a lot things that people say you can't do and I get it done.

I get cash back which I prefer and since we started using the Chase card in 5/11, we have already received at least $1000 in cash back.

We NEVER EVER carry a balance and I have no idea what interest rates are because we are big numbers people, planners and we would never consider not paying in full. I send in money everytime I cut an expense check and round up. By the time I get my monthly bill, my balance is usually a credit or a low number because I send money in all the time. For instance, I used the card to pay car insurance and house insurance which was around $5000 but the same day I charged, I sent $5000 via online pay to Chase and it offsets the balance.

We used to use Citibank Drivers Edge where you get credit up to $500 per year. The "deal" here is when you buy a car, after you work your best deal, close on the deal, etc, send the invoice to Citibank with the proper form and they send you cash back. We got up to $1500 back on 1 car and $1300 on another. Again, NEVER carried a balance

When the amount limit was up on Driver Edge, we used Citibank American Air. We got numerous free tickets off this card, however, it got to the point that it was not worth it to us because American blocked out so many freebies, it was hard to get a ticket, then they started charging.

We get about one free ticket every 2 months from Southwest on their frequent flyer program, no charge cards involved. Just frequent flier and they also work with the car rental companies we use so we get credit that way too.

We stay free at the Hilton family of hotels because we are diamond members and get points for every stay. Again, no credit card used for these perks either.

Bottom line, if you do this and you are paying in full each month and never carrying a balance, it is a perk for cash back. However if somone does not pay in full monthly, it will suck you dry and put you in debt.

Debt is evil and there is no reward program anywhere that is worth it if you are in debt.

3 moms found this helpful


answers from San Diego on

We have a Chase Disney rewards card. We never carry a balance and pay it in full each month. In fact I go online every few days and pay off the current balance. You can make a payment up to every 3 days online.
At my husband's previous job we had to use our personal card for all his travel and then get reimbursed so he used that card for everything work related. We also use it for nearly all our day to day spending. Do be careful with ones that charge an annual fee, you often have to make several thousand dollars worth of purchases in order to make back that amount in points. They are now offering a premium Disney rewards card with a $50 annual fee that allows you to earn double the points or something and you can use the points on Disney trips which you can't with the one we have. I think the guy said we'd have to make $2000 worth of purhcases to make up for the fee or some such amount. We're not getting that one.
When it came time to renew our Disneyland passes we had almost the full amount for 4 Premium annual passes (the most expensive ones)!
So long as you use the card responsibly, never carrying a balance, paying it in full each month etc it can be a great thing to have. We only have that credit card and one other through our credit union that is never used and is only for emergencies. We have no other debt except for the house mortgage, both cars are paid off.
Credit cards can be used responsibly and the rewards can be great if you know how to use them.

2 moms found this helpful


answers from Eugene on

I have 2 rewards cards. One pays cash back once a year. The other pays miles but I just discovered I can convert those miles to dollars and apply the reward to my bill. So it is like cash back, too.

I used to have a card tied to my airline mileage plan. It was great until a year or two ago when the airlines tightened availability and raised miles needed for free flights. It no longer was a good deal so I switched to the cash back cards with no annual fees.

And yes, I accrue points on all my purchases, with bonuses for dollars spent on gas, hotels, restaurant meals, travel etc. I don't pay interest since I pay the balance off every month.

2 moms found this helpful


answers from Chicago on

You have to read the fine print, each card is different. I pay my cards off each month but earn points on the purchases, so I still get the points and never pay interest.

A lot of things that you can buy through these programs are cheaper elsewhere if you look, so I mostly use it for cash back, but there are times that they run specials and then it is a good plan.

2 moms found this helpful


answers from Detroit on

We have an AmEx card and we use it for everything -- cell/cable bills, food, gas, etc. -- and pay it off every month. Our AmEx bill each month is typically about $1600-$2000. We just cashed in all our points we've racked up in a full year. We got a nice convection/toaster oven (about $250 retail) and $100 in WalMart gift cards. I kind of thought we'd have had enough points for an African safari, but I'm OK with the free toaster.

1 mom found this helpful


answers from Columbia on

Yes, you still accrue points sans interest.

As my financial guru, Dave Ramsey says, "No one ever got rich on credit card rewards."

Also consider that something like 80-90% of all frequent flyer miles are never used.

1 mom found this helpful


answers from Las Vegas on

I have a card that gives me cash back, up to $300 a year. I get 1% on everything, the first couple of years I got 5% on gas and groceries, and I still get 5% back on different items every quarter. I'm not sure if I still get my $300 back a year after losing that 5%, but it is pretty close if not. For me, that is free money. There is no annual fee, I have never been late on a payment, and I pay for everything with my card. If you know you will pay it off every month, and there is no fee, I say go for it. Just make sure that you can use those points or whatever, my husband gets miles, and we do use them, but I don't think it is really worth it (he pays an annual fee). Also, I don't think you necessarily spend more because you use a credit card instead of cash, I don't have that problem anyway, but I also don't buy much extra stuff.



answers from New York on

In general, if you do not have to pay an annual fee and you know you can pay off the balance every month then you should give it a try. Yes, the points still accrue, it's based on your purchases and has nothing to do with interest.

The "catch" is that a large % of the population doesn't pay off the balance each month. Also, the credit card company makes money each time you use the card. So the more you use, the more they make.

Yes, it's worth it !!!! We have 2 credit cards that we use because of the awards. Both cards have no annual fee. We also pay it off each month, so we're not paying any interest. Even if we did pay interest the rate is reasonable, 11.74% and 13.24%. We receive over $200 a year in benefits just for using our cards (Chase Disney rewards and BJ's), and it's cost us nothing.



answers from San Francisco on

Credit card rewards can be helpful... it just takes some discipline and dedication. Use only one card for big, regular expenses but BE SURE to pay down/reimburse the card to keep the balance low/zero. Yes, the point are earned on purchases, not interest. The option I like better is our Credit Union rewards program that applies to our credit card AND debit cards... so you don't have to have a lot of expenses on credit to earn points. See if you can find something that has rewards for a debit card purchases if you're nervous about the credit card. Good luck!


answers from Los Angeles on

Credit card rewards can be AMAZING - if you get the right one and use it smartly. My husband and I just got 4 tickets to visit my family in Ohio for free (from California)... we went to Maui last year and usually get 4 free tickets a year (we went to Hawaii about 4 years ago too without paying for the tickets). We refuse to pay a yearly fee for any credit card, and we do not carry a balance (i.e. pay interest). Those bonus points are ABSOLUTELY legitimate - and as long as you pay off your card each month you will not be adversely affected. You do need to be somewhat flexible in your travel (at least 2 weeks advance notice etc.) -- but we have been booking through the "Thank you" network (for cashing in points for airline and other stuff) for years and LOVE it. If a card tries to charge us an annual fee we call in and ask them to waive it - some do, but if not we go to a different points card (sometimes there is no fee for a year or two or three, then they want to charge you; dont "close" the account - just stop using the card as closing the card adversely affects your credit score)

We actually pay many bills like my kids tuition payments as well as any other bill we can on the CC just to earn the extra points. Yes we end up spending a LOT of money on our CC each year but we pay it off monthly. If you are disciplined enough to do it - go for it. I like working the system to my advantage...


answers from San Diego on

Yes, they're great! In the past, I had the Citibank American Airlines rewards card and accrued enough to buy a first class round trip ticket to London. My friend has the AMEX Starwood points card and they use it to pay most of their bills, pay it off every month and are able to use it for a vacation almost every year. I recently also got the Amex Starwood card and we also pay it off every month. We have had it less than 6 months and already have 2 days worth of stays at Kaanapali Maui resort. When you spend your first time, they give bonus points, and then if you spend more than a certain amount they give you another big set of bonus points your first year. We also got lucky because my husband was sent on a business trip this year and he was able to stay at a Starwood hotel and use our AMEX, so we got points for him staying at the hotel (reimbursed by his company) and points for paying with the AMEX.

The only catch is that Amex has a decent annual fee after the first year. Usually between $45-$65 per year. But, and this is a big BUT, if you are able to get enough points to have a free hotel stay or airline tickets, I'd say it's worth it.

You just have to be very diligent about paying it off every month. Amex makes it so you can set up all sorts of reminders to be sent to you - if you reach a certain dollar amount, if you're too close to your limit, that sort of thing. You can also set it up to auto pay the full balance every month so you can be sure that it all gets paid off.

Yes, you earn points no matter if you're paying interest or not. You earn points based on the dollar amount you spend.

Amex has all sorts of cards, you should check them all out and compare pricing for things. We already had a lot of points built up in our AA account and from another card for airline miles and we really want to go to Maui. When we looked online, we found out how expensive it is to stay there, so we decided the starwood hotel card was best for us. They have other hotel cards too (Marriott, Hyatt, Hilton, etc.).

If you're diligent about paying it off, it's almost stupid not to get a card that rewards you (so says Suze Orman, or some other financial guru). My Mom uses Discover for cash back. Last year, she got $1000 cash back.




answers from Seattle on

We have a Costco Amex with cash rewards - so you get a small percentage of cash back every time you use it and that works fine for us. We pay it off every month - so yes, we did get the rewards even though we did not pay interest.

We have had mileage program cards before but were never able to actually rack up enough milage to use it - it's been a few years so maybe they have improved the programs... or maybe we just don't spend enough on our credit cards (we typically only spend maybe $100 a month on them plus the annual flight tickets for vacation).
Good luck.



answers from Pittsburgh on

Bad idea all around.
People spend around 20% more when paying with a credit not just save up the dough?
Credit cards don't offer these "incentives" because they're good for you, they offer them because they're good for THEM.



answers from Los Angeles on

You might want to compare the different cc options at
You can search under different categories, etc and compare different rewards (cash back, air miles, hotel, etc..). If you're going to have a cc, you might as well have one that gives you some kind of reward. We've had a rewards card for years, but the cash back was capped at $300/year. We've recently switched to a different one with no limit.



answers from Los Angeles on

Love love love our Amex Starwood card. Great deals on vacations with the points.

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