Ever since we were young, we have been thrilled with rewards for good behavior. As babies, we learn to talk and deliver our talents in exchange of prizes or rewards. As we grow older, in elementary, we are given stars or medals for achieving a certain behavior. This continues until our adolescence, and even as we grow older, but in a more mature form involving money. Yes, even credit cards reward you nowadays for good spending behavior.
But what exactly is a good spending behavior? I don’t think good or bad spending habits matter that much to banks. What counts in the end of the day is how much you spend with their cards and how it benefits their economy. Banks encourage us to spend more and more, but of course, in exchange of rewards.
These rewards have certain categories in terms of target audience. Cards can target the lay spender, businessmen, travelers, and a myriad of other types of people. For the lay spender who just likes to use their credit cards for their daily shopping, such as grocery, home appliances, and food, they can choose cards that offer cash back rewards. These types of spenders can vary from parents, working students, and the average professionals.
Savings is the main principle of getting cards that offer cash back rewards. As you purchase goods and maintain your budget, you earn points and when you redeem these, you get your cash back. However, in exchange for this reward, you should be a responsible cardholder who pays off your monthly dues on time.
Don’t be fooled though by thinking literally – cards do not give you money, more like deducting that certain amount to your outstanding balance. But through this, you really can save up.
Other cards also offer rewards for business, such as giving discounts for business-related purchases. These purchases could include payment for FedEx, Air21, DHL, and other business transactions. You can also save points and redeem these in form of freebies, such as free hotel stay, free gasoline, or free flights.
Travelers and hotel guests can benefit from these rewards as well. For example, if I were a frequent guest of a certain hotel, it’s best to get a card that includes that certain hotel in their rewards. That way, I could reap more benefits from the card, such as discounted hotel stays, free dinner, or other perks. Really, the rewards are limitless here.