Do you want to earn bonus rewards and benefits as you spend money? Finding the right credit card could be the answer.
When comparing credit cards, the promise of earning rewards while you spend could be a beneficial feature to consider. Credit card companies push reward programs to gain the attention of new customers, but you’ll need to consider your options to ensure the rewards on offer will be of benefit to you. If you regularly spend with your credit card, a card linked with a rewards scheme could be a great way to earn additional benefits as you spend.
Bonus Points Credit Card Offer
The American Express Platinum Edge Credit Card allows you to earn up to 3 points per dollar spent. Also includes a domestic return flight on Virgin Australia each year.
- $195 p.a. annual fee
- 20.74% p.a. on purchases
- 0% p.a. for 12 months with 1% balance transfer fee on balance transfers
- Up to 55 days interest free
- Minimum Income Requirement of $50,000 p.a.
Credit cards with bonus reward points
Credit cards with bonus reward points review
Credit cards with bonus reward points give potential customers an incentive to sign up for the card for the opportunity to earn rewards as they spend. While some of these programs provide cash offerings for signing up, others offer bonus points that can be redeemed for other services or products.Because of the wide variety of rewards credit cards on offer, you’ll need to compare your options ensure that the rewards program and features of the card suit your unique financial situation.
What is a credit card with bonus reward points?
Rewards credit cards are linked to rewards programs that allow cardholders to earn points as they spend. These points can be redeemed for a variety of products and services, including discounts on travel costs, merchandise such as fashion, gadgets and entertainment packages to name a few.
Different rewards credit cards offer varying rewards options and earn rates for their cardholders. Some rewards credit cards come with limitations, such as point caps or expiration, or may have better earn rates or rewards than others. Make sure to read over the terms and conditions to ensure that the rewards you receive from the card will outweigh any costs.
How do these cards work?
These cards often come in two forms; you can get bonus reward points on sign up which runs into the tens of thousands, or bonus points for spending money with your card in certain locations.
In order to benefit from a credit card with bonus reward points, you need to ensure that you can afford the annual fees charged so that the rewards are not offset by having to pay a sizeable fee for the card each year. Such credit cards also have higher interest rates, so be on the lookout for how much interest is charged on the card before applying for it.Back to top
What are the types of credit cards that offer bonus reward points?
There are a number of rewards credit cards available on the Australian market. Compare your options and choose a card that compliments your spending habits and the rewards you want.
Frequent flyer cards
Frequent Flyer cards are designed to provide you with points that are redeemable for flight discounts and travel perks. Your accumulated frequent flyer points can be used to purchase flights or class upgrades. Some of these credit cards will also provide you with access to priority check-ins, exclusive travel lounges at airports or other rewards.
Cashback rewards card
Cashback cards will provide a certain percentage of your total spending as a cash reward. Usually the percentage you gain back as a reward is around one of two per cent and is awarded at the end of the year. Other programs will provide you with cashback rewards in the form of credit or vouchers at select stores or businesses.
Merchandise rewards cards
Merchandise reward cards will provide you with discounts or other benefits when you spend money with affiliated partners. It is common to also receive additional reward points when making purchases with the same affiliated partners. The benefits of these cards usually apply to retail stores or general purchases.Back to top
How to compare reward credit cards
When comparing available rewards credit cards, you must take into consideration both your personal needs and the features of the varying reward programs. Here are some of the details you’ll want to pay attention to:
- Annual fees. Many credit card programs, regardless of the added benefits, will have an annual fee. The cost of maintaining your credit card may outweigh the value of the rewards you receive. For example, if you use a cashback card, you must ensure that you spend enough to cover the cost of the annual fee. Annual fees should be viewed as the cost of owning your credit card.
- Rewards program. Many credit card programs, regardless of the added benefits, will have an annual fee. The cost of maintaining your credit card may outweigh the value of the rewards you receive. For example, if you use a cashback card, you must ensure that you spend enough to cover the cost of the annual fee. Annual fees should be viewed as the cost of owning your credit card.
- Extra perks. Some extra perks may seem more valuable than others. But if you do not use the perks often enough, you may be able to find a program more relevant to your needs. You must weigh the value of the perks with how often you will take advantage of the perks.
- Interest rates. The interest rate of your credit card is of crucial importance. Your set interest rate will determine your total future monthly payments should you not payoff your credit card bill in full and on time. It is often the case that more valuable reward programs will also have a higher interest rate. If you cannot payoff your credit card bill in a timely fashion, the added benefits of the card may not be worth it.
What else should I consider?
Remember that there are terms and conditions for bonus reward points. Here are some of the other considerations you’ll need to keep in mind:
- Are you willing and able to pay the annual fee? Remember that some cards have costs associated with maintaining the card.
- Is the reward program suitable for your needs? If you cannot take advantage of the program, then it may not be the right card for you.
- Are you in a proper financial position to own a credit card? Owning and using a credit card is a privilege and a responsibility. If you’re unable to pay off your bill, either because of neglect or a lack of funds, you may want to reconsider.
- Will you actually use your credit card? If you tend to use cash rather than credit, then you will need to weigh your options and see which card is suitable for you.
If used properly, a credit card with bonus reward points can be of benefit to the cardholder. If you’re already using your credit card regularly, you can receive rewards for everyday purchases that may have otherwise been unavailable to you. From travel perks, discounts on services and more, cardholders can earn a variety of rewards. However, these credit cards often come at the cost of high interest rates or annual fees, so you’ll need to calculate whether the rewards offset any costs associated with the card. As always, compare your options and consider what would work for you.Back to top
What are the benefits and drawbacks of credit cards with signup bonus points?
- Earn rewards as you spend. If you already use your credit card on a daily basis, a rewards credit card can allow you to earn additional points on your regular purchases.
- Extra perks. Many rewards credit cards offer additional features and bonuses. For example, some frequent flyer credit cards offer travel upgrades and access to airport lounges.
- Bonus points. Some credit card rewards schemes offer new cardholders extra points on sign up, while others allow members to earn bonus points while spending with affiliated partners.
- High annual fees. Rewards credit cards usually come with an annual fee. Unfortunately, the better the rewards, the higher the fee. Make sure that the amount of rewards you’ll earn each year will offset this fee.
- Higher interest fees. If you don’t pay your balance in full each month, you’ll incur interest rates on purchases. Some rewards points won’t allow you to redeem your points if you haven’t paid it back in time, so make sure to read over the terms and conditions to know what limitations are involved.
- Limitations. Many rewards credit cards pose limitations, such as conditional bonus points, yearly earning caps and expiration on points. Again, make sure to read over the T&Cs to make sure you get the most out of your points.
Frequently asked questions
Do I get reward points on cash advances?
No. Rewards cards only give you points for spending money, so cash advances will not earn you any points.
Are there caps on how many points I can earn?
Some rewards credit cards do have an annual cap on the points you can earn in a year, so be sure to look out for that in the fine print.
Can I save my points indefinitely?
Many credit card reward points have an expiration date. Check the fine print before applying.
Can I transfer my reward points to a different card?
It depends on the cards in question. If they are affiliated in some way, it is likely that you can transfer your points or at least use them to redeem points with the affiliated partner.