Common credit card rewards programs are:
Frequent Flyer Miles
This credit card rewards program offers frequent flyer miles on card purchases, which can be accumulated and redeemed for airline tickets. Most frequent flyer reward programs offer free bonus points on signing up and double points on initial purchases with the card.
However, an important drawback of the frequent flyer miles credit card rewards program is that the miles have blackout or expiration dates. In addition, they usually come with high annual fees and caps on the number of miles that can be earned.
The points based credit card rewards program enables one to redeem reward points for a number of items, such as gift cards, hotel accommodations and other merchandises. This is a more suitable option for cardholders who do not travel frequently. Typically, bonus points are rewarded on all purchases, although the points are higher for purchases at the issuer’s partner stores and affiliates. Most point-based credit card rewards programs are offered without any annual fees.
However, remember that it generally takes more points to discount for a flight than it does with a miles-based reward program. Moreover, point-based reward programs can only be redeemed at select retailers and services, which might not necessarily be frequented by a cardholder.
Cash Back Rewards
This is the most simple and straightforward credit card rewards program. It allows a certain percentage of purchases as rebate, which is usually around one percent. Some programs enable the cardholder to earn a rebate as high as 10 percent on qualifying purchases. Gas cards usually offer substantial cash back on every refill.
However, a cash back reward program translates to a small discount on purchases, which does not offer exciting prospects of getting free flights or holiday packages.
Depending on whether one is interested in general savings at various establishments or targeted savings with frequented establishments, a cardholder can select from a wide range of credit card rewards programs. However, keep in mind that usually a card offering lucrative rewards has high balance transfer and cash advance rates, enabling the issuers to cover the cost of rewards.
Need more featured reports? Check out Economy Watch's research Store