Loyalty reward credit cards

We’ve used to choose credit card for years now. However, in the past the choice was mainly based on credit limits, grace periods and interest rates. All these factors are still extremely important, but you’ll also like to consider one more aspect - customer loyalty plans.

What Is a Customer Loyalty Plan?

You by 99% accuracy have already heard about customer loyalty plans, but didn’t recognized them. The most well-known CLPs are frequent flyer programs of the big airline companies. These programs help to keep customers loyalty for years. So it’s not surprising, that loyal customers are being treated much better then those who buy on the spot. So the idea is to reward customers for being this company’s customer. And credit card organization took up this good idea!

It all started with “cash-back” bonuses. Discover credit cards offered a small percentage (usually 0.5-1%) back for everything you buy with their car. Then the major airline companies started using their very special airline Visas or Master Cards for rewarding frequent-flyers.

What Kinds of Plans Are There?

As said before, you can get cash backs or free tickets, but can also go to Disneyland for free, earn gas for your vehicle, get discounts in big stores, get free lunches on Wednesdays in some cafe using a credit card. But hold on for a minute. Have you ever dreamed of possessing your own island? Ok, if you have enough points you can even rent an island!

But you should remember, that most of the credit cards are very specific, and only let to spend points on some specific product, like General Motors cars. However, some credit cards offer much wider opportunities to spend your points.

Calculating the Costs

Some credit cards have better interest rates, while other gives more points for every spent dollar. So keep in mind, that there won’t be probably a good balance between APR and bonuses. You should decide which is better for your - credit card with low interest rate, or credit card with wide customer loyalty options.

Ok, let’s make clear the other thing. If you get 1 point for every dollar, so you might think that the redemption is equal. Far from that! You’ll most likely get $1 for 100 points! You can get more points while special promotions are running, so it’s a good idea to look after such promotions, when owning a loyalty rewards credit card.

Finding a good credit card has become much easier over a couple of years. Now you have to determine what would like like to do with your card, and find a card which meets your needs!