Here’s everything you should know about cashback credit cards
Wouldn’t it be amazing if you got a portion of the money that you spent on something back into your bank account? Well, this would definitely brighten many people’s day. This is why the demand for cashback credit cards is on the rise. Cashback credit cards have endeared themselves to users since it rewards them in cash instead of points that regular rewards credit cards usually offer.
Cashback credit cards are quite simple to use, and the usual paraphernalia such as the terms and conditions of using the collected points are not applicable to cashback credit cards. In fact, the best cashback credit cards of 2018 allow its user to redeem the cash whenever and wherever they want. Every cashback credit card calculates the amount of money you spent in a particular month and offers a particular portion of the same to its user after the end of the month.
It is imperative to know that no two cashback credit cards function in a similar way; they offer different incentives, and the rewards and their programs also vary. So, it is imperative for you to acquaint yourself with the different types of cashback credit cards before you choose the right one for yourself. So, here are some factors that will help you en route to making the right choice.
What are the different types of cashback credit cards?
There are three types of cashback credit cards. They are as follows:
- Category bonus cashback credit cards: These types of cashback credit cards allow you to earn around 5% cash back in a single category, and around 1% on the other purchases. Moreover, this specific spending category that allows you to earn greater rewards is bound to rotate every 3 months. You will have to activate the spending categories whenever there’s a new offer.
- Tiered rewards cashback credit cards: These cashback credit cards offer a high rewards percentage on certain categories such as gas or groceries and a lower rate—around 1%—on other purchases. These credit cards can limit the cashback on a certain category.
- Simple cashback credit cards: These are the simplest cashback credit cards; you wouldn’t have to track or activate any bonus category. You will earn the same cashback for every purchase.
When is investing in cashback credit cards advisable?
- Opting for the best cashback credit cards of the year is a good idea when you know that you can pay the credit card bill in full at the end of every month since it would affect your credit score.
- Also, you need to understand that cashback credit cards yield benefits only when you use it for spending; however, if you have a balance on either of your credit cards, it results in the cancellation of the rewards.
- Moreover, it is imperative that you check your credit score to gauge whether applying for a cashback credit card is within your league. This is essential because if your application is rejected and you apply for another credit card, this might hurt your score. So, opt for a cashback credit card only if your credit score is within the accepted category.
Are there any limits imposed on cashback credit cards?
There are certain limitations and requirements that are imposed even on the best cashback credit cards of 2018. They are as follows:
- Various cashback credit cards impose a limit on the amount of cash you can get back every month. However, there are a number of cashback credit cards that do not adhere to such limitations.
- Another popular criteria you need to fulfill is that you need to use the cashback credit card for a certain number of times per month in order to qualify for the reward.
- Certain cashback credit cards require you to spend a specific amount in a single receipt, on particular days of the week, or at certain shops or outlets.
Which are the best cashback credits cards with no annual fees?
- Cashback credit cards are quite an impressive financial tool and offer the customers various benefits. However, certain cashback credit cards charge an annual fee for the same, and you have to pay it if you wish to use the cashback credit card without any interruption.
- Though most cashback credit cards charge an annual fee, there are certain cashback credit card providers that do not impose this annual fee. They are the Discover it® – Cashback Match, Wells Fargo Cash Wise Visa® Card, Capital One® Quicksilver® Cash Rewards Credit Card, Chase Freedom®, and Chase Freedom Unlimited®. These cashback credit cards were among the best cashback credit cards of 2017 as well.
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