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Here are the main types of reward cards and how they work...
One of the primary benefits to using a credit card is that many credit card offers have reward programs. The specifics of the credit card reward programs vary from one card to the next and from one credit card company to the next but there are some general categories. Here are the main types of reward credit card offers that you should be aware of.
#1 Points Credit Card Offers:
Points credit cards are designed so that every dollar spent with the credit card earns some type of points that is credited into the cardholder's points program account to then be later redeemed for anything from merchandise, airlines miles, to even cash back. Different types of purchases typically earn differing amounts of points.
#2 Airline Credit Card Offers:
There are typically two types of airline credit card offers: airline credit cards branded by a particular airline (i.e. Delta, United Airlines, Southwest, etc.) and airline credit card that are generic airline rewards credit cards. Many airline credit cards use some form of points reward program coupled with a frequent flyer miles program.
#3 Cash Back Credit Card Offers:
Cash back credit cards are quite possibly the most popular type of credit card reward program. The simplicity of earning cash back for making purchases with a cash back card is what attracts many to choosing a cash back credit card offer. Typical cash back rewards can range from 1% cash back to 5% cash back (with limitations).
#4 Retail Credit Card Offers:
Many department stores have store branded retail credit cards with a rewards program. Retail credit card reward programs typically incorporate some form of merchandise discount, coupon, or savings for cardholders that meet certain minimum spending thresholds or tiers.
#5 Dining Credit Card Offers:
Dining credit cards are popular for both frequent travelers and those who just enjoy eating out at restaurants on a frequent basis. Discounts on meals, desserts, and drinks are a staple of dining credit card offers.
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