All there is to know about reward points

All there is to know about reward points

Credit card rewards are amazing. You can earn miles and redeem them for trips and the more you spend with your credit card, the more points your rack up. But the strategy is a bit more complex than that.

Usually, we feel like making big purchases will make us earn points more quickly. If you have to make a big purchase, like remodeling your house, then you might want to use your credit card to get something in return for all the big spending. However, here are some things you should know:

1. Make sure the merchant accepts credit cards

Merchants have to pay a 2% or 3% fee for every credit card transaction, so not all of them accept it as a payment method. Before you even get started, you need to make sure that they will accept it.

If they accept credit card payments, you still need to make sure that the merchant is part of a reward program. Otherwise, you will not get any points for making that big purchase.

2. Find out if there is a surcharge for using credit card

As we mentioned above, merchants have to pay a fee for every transaction. So it is not that crazy to think they might impose a surcharge to your transaction. And if it is a big one, the surcharge can be huge. There are some states where this practice is illegal, so check before buying!

3. Find out if the company offers a cash discount

As tempting as a reward program is, find out how much you’d save if you paid cash. If the discount is greater than the reward, then you might consider going for the cash option instead.

4. Check if your card issuer will approve the transaction

When you need to make large purchases, it is usually a good idea to check with your credit card issuer to make sure they will approve the charge. You need to have enough credit lines, but even if you do, they might flag the transaction as a suspicious one.

5. Check how this will affect your credit

A considerable portion of your credit score is determined by your credit utilization ratio: this is basically the amount of debt you have compared to how much credit available you have left. 

Even while paying your balances in full, a big purchase can have a temporary impact on your credit score. You can avoid this by making large payments before the statement period ends, this way you will reduce your statement balance and its impact on your overall score.    


Having many cards is not that easy: you need to keep track of annual fees and keeping them organized can be time-consuming. If you don’t have the time, you can still make the most out of the rewards program of your current cards.

Reward cards offer points for every dollar you spend, so it’s only logical to use your card to make purchases and get points in return. But sometimes we use different payment methods for a lot of things that could be paid with a credit card and that’s when we “lose” points.

Actually, there are some bills that you can pay with credit card without any fees. Check if you can pay rent, utility bills, health insurance, cable TV, internet, cell phone, taxes, etc. Think of other bills you could pay with your credit card. Even if you have uncommon expenses, check there too. You can actually set auto-pay so you don’t have to remember doing this every month. You should also pay everyday expenses like groceries, gas or transportation. If you buy something online or at a store, try to pay with your rewards card as the first option.

Another important thing is to leverage your favorite card bonus categories, especially if you have a few cards with different bonus categories, so you make sure you use the right card for bills. This is because some cards offer, for example, 3x bonus points for dining out and another one offers 5x times bonus points for groceries. Smartly use them to take advantage of all those benefits.

There are a few things you need to consider, though. Make sure there are no extra fees for using credit, as some merchants or vendors might charge you. But most importantly, you need to be as organized as you possibly can to stay out of debt. Never use it to make purchases you won’t be able to afford when the statement comes, no matter how tempting the reward is for it!


It takes a lot of work to figure out which rewards or cashback credit card would meet your needs in the first place, and oftentimes we end up not making use of them. Here are four ways to automate your credit card rewards and monthly payments and make the process much more organized.

1. Use AwardWallet to track your points and miles

AwardWallet is a free service that allows you to manage all your travel points/miles in one place. It's a real time saver when you are managing dozens of loyalty accounts with varying expiration dates.

All you have to do is add your current award accounts to get started and AwardWallet will track and monitor your rewards programs and itineraries. This includes notifying you if your points are about to expire or if your point balances have changed for any reason.

2. Check out tracks your loyalty programs, exchange points and miles between programs, and redeems them for gift cards

Joining is free, and once you sign up, you'll have one password and login for your programs, which is much simpler than keeping track of multiple logins.

3. Use Reward Summit to maximize your miles

Reward Summit is an app that tracks your credit card rewards programs so you never miss out on another dollar again. 

When you sign up for Reward Summit and connect your credit cards to your account, the app helps you choose the right card for each purchase you make based on which one offers the most rewards.

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