Cash back credit cards
Introduction (interrogative)
Wouldn't be nice to pay regularly for your items and receive money in exchange for your behaviour? Well, several credit cards reward your fidelity.
What is this type of credit card about?
In order to encourage you to pay with your credit card, the banks would propose you facilities such as small reimbursement on your purchases. This is, as you pay, you are reimbursed on the card, with vouchers typically of 1% or 2% from the value of the purchase. The reimbursements may be effective only within specific networks of merchants and the vouchers may be spent also within those networks.
What are the benefits and disadvantages?
Note that more expensive credit cards will give access to a bigger reimbursements to a wider network of merchants where you can benefit of this advantage. Actually, in order to be reimbursed, you will need to acquire an item, which to some extend can foster a consumerism behaviour. If on top, you decide to pay in instalments, the interest you will pay on your purchases may overpass the cash back bonus you will accumulate, so better make your calculations wisely.
The benefits
- You are rewarded for your normal purchasing behaviour
- You get reimbursed on your card with % of the cost of the item purchased
- You can use the saving later, mainly in the same network of merchants
Our advice
This card gives you access to many advantages. Yet, you will need to properly weight the individual advantages you will get out of the card and the extent to which they are fit for you, with the costs incurred by the interest you will have to pay when using the card.
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