4 Reasons Why You're Still Not Using Credit Card Rewards
2. You don't know how to make your rewards work for you
For some people, earning reward points is a game and it requires a certain amount of strategy to make it work. That means knowing which cards offer the best rewards, where the biggest sign-on bonuses are and spending wisely so those points aren't costing you money.
For instance, if you travel regularly and you have an airline-branded rewards card you use to book your flights, linking it up to the airline's frequent flyer program gives you an opportunity to earn more points or miles, along with some extra perks like complimentary lounge access, baggage fee waivers or preferred seating.
If you've got an higher-tier card that charges an annual fee, you should look at how you can use your points to cover the cost.
The catch is to pay your balance off in full each month so you're not getting charged interest, which would effectively reduce the value of any rewards you're earning.
3. You think you won't qualify for a signup bonus
Credit card companies offer attractive sign-on bonuses to lure in new customers but there's usually a spending requirement that you need to meet in order to qualify.
Thinking that you won't be able to earn a big bonus is a mistake, since it may be easier than you think to get your spending up to par.
Making a lump sum payment towards your student loan debt, paying up all of your bills for the month or financing a large expense like a new refrigerator can get you closer to qualifying for the bonus with very little effort.
If you still don't think you can charge enough to get the bonus, look for a card that doesn't have a minimum spending requirement.
Tip: You can also pay your tax bill with a rewards card to qualify for a sign on bonus but keep in mind that the IRS charges a service fee of 1.87 to 2.35 percent for these transactions.
4. You picked the wrong card
When you're shopping around for a rewards card, it's easy to get blindsided by the sign-on bonus but you have to look at all the details before you open an account. If you're planning your dream vacation, for example, the US Airways bonus could cut down on what you'd pay for flights but the card won't yield much in rewards if you don't plan to use it after that.
Choosing a card that matches your spending style ensures that you're earning the right kind of rewards and getting the most points on every purchase. If you're an everyday spender, a card with tiered rewards might make sense. On the other hand, if you only charge your travel or entertainment expenses, then you might be better off with an airline card.
The bottom line
Sometimes, failing to make use of credit card reward points is just a matter of laziness but more often than not it comes from a simple lack of knowledge. The more you know about how your card works and what you can do with your points, the easier it is to leverage them in your favor.