(5.00 out of 5) (5.00 out of 5) (5.00 out of 5) (5.00 out of 5) (5.00 out of 5) (5.00 out of 5)
(4.80 out of 5) (4.67 out of 5) (4.50 out of 5) (4.50 out of 5)Credit card and finance computations can make your head spin, we have developed common calculators to assist you.
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Have you ever wished you could earn money while you were spending it? Well, with cash back credit cards, you can. Learn more about the potential benefit of these cards before you get your next credit card… read more.
How Cash Back Cards Work
Whenever you charge something on a cash back credit card, you earn rewards. The way these rewards are tabulated is different from program to program. In some programs you earn points, which you can exchange for airline miles, cash, or gift cards. In other programs you are sent a rebate check at the end of the year for a percent of all of the money you charged with the card. Some cards reward you for your purchases at specific locations, such as gas stations or office supply stores.
The simplest type of cash back credit cards are those that send you a rebate at the end of the year, either in the form of a check or in a credit on your balance. If you have a points reward credit card that offers cash, you may not know it, because you may be unaware of the points you are earning. Be sure to check with your current credit card company to learn what cash back options you may have.
The cash back reward is typically between one and five percent. However, the higher the reward, the more restrictions are going to apply. A five percent cash back card may, for instance, have an upper cap, or a limit on how much you can earn. The lower percentages usually do not have as many restrictions.
Always Read the Fine Print
As with any credit card, if you are in the market for cash back credit cards, be sure to read the fine print on the different offers that come your way. For instance, you may find a card that appears to offer five percent on gasoline purchases, only to read the fine print and find out that it is just the first $1,000 in gasoline purchases that earns this amount. Other cards may offer “rewards for the stores where you shop the most.” This sounds like a good idea, but you need to know how they determine which stores you shop at the most.
Also, read the fine print about the card itself. For instance, learn how long the grace period is and what the late payment charges will be. Sometimes these are less generous with cash back credit cards than with cards that do not carry a reward. High late payment fees and short grace periods are not a problem, however, as long as you know what they are and can work within their parameters as you own the card.
Finally, a word of warning when using cash back credit cards; the amount you earn in cash back is never more than the amount you will pay in interest if you carry a balance on the card. Be sure that you do not over spend on your new card simply because you will be earning cash back. Only spend what you can afford to repay, and you will benefit from these programs.