Pros & cons of cashback credit cards

There are two sides to every story: the upside and the downside. If you were wondering a cashback credit card was a good option for you, here are the pros and cons.

Getting rewards while you spend money is amazing. Most credit cards offer a reward program to entice you into signing up. While some cards will offer points in exchange for every dollar you spend, cashback credit cards will offer the possibility of getting some money back.

Here’s a list of all the things you should take into account.


1-    They are easy to understand. You can keep up with how much you’ve earned because you don’t have to convert points and miles into equivalent cash. This is already cash.

2-    Your cashback is easy to redeem. There’s no trick, really. You just need to connect your bank account for a direct transfer, although gift cards and statement credits are also available options.

3-    Variety of bonus categories. Depending on the cashback credit card, you could earn high-rate rewards on categories that rotate throughout the year. Some other cards offer an unlimited flat-rate cash back on any purchase.


1-    Not everyone qualifies. In order to be able to apply for a good cash back credit card, you need to have a good FICO score of at least 700 points.

2-    Signup bonuses. Cashback cards usually offer a sign-up bonus, but in order to redeem it you need to meet a minimum spending requirement. This could tempt you into spending more money than you can afford, resulting in a balance you can’t pay in full and incurring in interests.

3-    Tracking bonus categories. As the categories rotate throughout the year, you need to be disciplined if you want to make the most out of your cashback credit card. Keep track of the bonus programs so you use your cards accordingly.

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