Credit cards may mean several things to many Americans. For a cardholder owing a bank thousands of dollars in unpaid bills, a card can be a prison sentence. For a responsible consumer, however, having a credit card can mean never having to carry cash and garnering precious benefits at the same time.

Because of the highly competitive credit industry, banks and card companies entice consumers with special promos, rates, and of course, reward programs. These practices are designed to reel in more potential cardholders by promising credit card rewards every time they use plastic to buy something.

The common misconception is that reward points are just marketing gimmicks. Many cardholders believe that rewards are just shams and are totally useless. What they fail to understand is that these programs are very much real and useful.

Responsible cardholders know that the key to enjoying all the benefits that come with plastic is knowing every little detail about their cards. They also know that paying on time and in full does not only mean the absence of debt but also several other rewards and perks.

To maximize potential rewards and points, experts recommend that consumers follow several simple guidelines. These suggestions can help cardholders control their spending habits better and earn more rewards in the process.

Most card companies reward cardholders who use plastic regularly with redeemable points. These points can be converted into free travel miles, freebies, and even cash-back options. Suppose a cardholder has charged a total of $20,000 to his or her account for a year. If the bank awards one point for every dollar spent, then this would mean 20,000 points. Provided that the consumer settles his or her monthly dues fully and on time, 20,000 points will go a long way in getting tons of credit card rewards. The cardholder can then redeem the points in exchange for free trips and even substantial cuts on his or her bills.

Using a specific card for specific regular purchases can also mean more points. A gas card, for example, would mean lower fees and charges when used more often. Using it on a regular basis can also mean rewards in the form of free gas and deductibles on the monthly bills.

Many industry experts contend that the secret to enjoying the many reward programs offered by banks and card companies is to keep track of how much a cardholder spends. Being a responsible consumer means knowing every facet of their plastic transactions and the benefits that come with them.

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