Earning cash back on your regular spending is a fantastic benefit. When credit cardholders try to maximize the amount of money they receive, they have a nearly endless choice of credit cards to apply for. Among these cash back reward credit cards are those that offer fixed reward rates on all spending, as opposed to those that offer varying rewards depending on the category of merchants, and even the time of year. Although these varying reward rates can be attractive, there are distinct advantages to earning rewards year round at a fixed rate.
Cardholders frequently choose to earn cash back rewards instead of loyalty points because of the simplicity and flexibility that cash offers. To keep their credit card choices simple, cardholders can avoid credit cards that offer bonus cash back for spending at different merchants each quarter.
By sticking with a simple cash back product, there is no need to recall various promotions each time a cardholder reaches for his or her wallet. Furthermore, it is unnecessary for cardholders to consider whether or not they have reached the maximum threshold for each bonus category. Finally, fixed rate cash back rewards credit cards have no requirement to register for different bonus categories, and usually have no caps on the amount of bonus cash that can be earned at certain types of merchants.
If a cardholder wishes to earn more than the cash back bonuses offered by a single card, it is possible to hold multiple cards with increased, year round bonuses for spending at certain merchants. The key is to balance the desire to earn increased rewards with the annual fees that must often be paid for each reward card.
For example, it may make sense to have two to four different cards, each offering higher levels of cash back at various merchants. In order to justify this strategy, each new card must be compared to the offers of existing accounts held in order to ensure that any bonus cash back exceeds what the card holder would have earn with his or her other cards, taking into account the new card’s annual fee.
Earning cash back rewards at a fixed rate is the simplest and most convenient way to do so. By carefully selecting the best cards to match their spending habits, cardholders can maximize their rewards while simplifying their credit card rewards strategy.