Best Credit Card Perks, And Where They Are

Vera Gibbons Sorts Them Out And Recommends Top Cards For Each Type

(CBS)  You're driving less, you've cut your grocery bill -- doing everything you can think of to save money.

Well, it may be time to turn your attention to that rewards credit card in your wallet!

Why not earn a gift for that money you do spend? Eighty-five percent of American households have at least one credit card offering rewards, according to Consumer Reports, but do you have the best card for you?

Early Show financial contributor Vera Gibbons provided some guidance Saturday:

This is a great time to re-evaluate whether your rewards card is really doing all it can for you.

First off, be aware that, just because it's possible to earn rewards with a credit card doesn't mean everyone should have a rewards card. These cards typically have higher interest rates than other cards, and are more likely to have an annual fee. That means, if you regularly carry a balance from month-to-month, you probably want to look for a card with a lower rate -- any rewards you earn will be cancelled out by paying the higher interest rate each month.

Also know that most of the cards have fairly complicated rules and restrictions. The cards can still be beneficial, but you really need to learn how they work and stay on top of changing rules.

There are all types of perks you can earn with a credit card: airline miles, gift certificates, money toward hotel stays, and more. But the most popular type of rewards card, and the type Gibbons recommends most, is a cash-back card.

They offer to give you anywhere from one-to-five percent back on purchases made with them.

Why does Gibbons put cash-back cards at the top of her list? Because cash is endlessly versatile, and there's no chance it's going to expire like airline miles might, for instance. And, Consumer Reports research found that cash-back cards tend "to be more generous in their rewards."

Not surprisingly, there are a lot of cash-back reward cards out there. So, how do you choose one that's right for you? For starters, you have to pick between a flat-rate card, which typically gives you a one percent return on everything you buy, or a tiered-reward system in which the more you spend, the more you earn. In general, if you're not a big spender, the flat-rate cards are probably your best bet.

Gibbons has two specific recommendations:

FOR SMALLER SPENDERS: CHASE FREEDOM VISA SIGNATURE
You get three percent back in the category you spend the most in -- from the typical categories such as gas, groceries, and department stores, to the unusual, such as beauty salons, spas, gym memberships, and pet supply stores. You receive one percent back on all other purchases, and a $50 bonus after making your first purchase.

FOR BIGGER SPENDERS: AMEX BLUECASH
This has been a top choice for years. You get one percent back on everyday purchases such as gas, groceries and drugstores, and half-a-percent back on everything else. But, once you've spent $6,500, you get five percent on those everyday purchases and one-point-five percent on everything else. Plus, there's no cap on your rewards, no matter how much you spend, unlike many reward cards.

[whitemale08]

Why would I want "reward points" for being a serf?

This article is disgusting.

Give me a good paying job so I can "put food on the family".

[oneworldusa]

Anyone with a news organization hawking credit cards to the public during today''s economic situation is irresponsible.

Notice how the ''reward'' cards suggested are looking for consumers to use their cards for everyday purchases? 3% back on one category of spending is nothing compared to the 20-29% you''ll spend in interest charges. Its all a scam.

[tylenol6]

If you are smart, you will stay away from these credit cards.

[greeneyes222]

I agree - this article is completely irresponsible. Perks are a ploy to lure in the unwary. She gives one brief disclaimer and proceeds to shill.

[puzzler125]

I have several credit cards with LOW annual interest rates, no fees and excellent perks. From Amazon.com you can get a free card (interest based on your credit history, the better your credit, the lower your interest) and get a $25 gift certificate for every $2500 you spend. You get more points for using the card on amazon.com and fewer points elsewhere but many perks cards give more points at their particular site, store,etc. As with every financial transaction you make you MUST read the fine print. There are many low interest great perks cards out there but you have to look carefully to find them!

[puzzler125]

You can also ask your credit provider for a lower rate. Banks are most likely to do this with stores not so amenable. Remember something. If you are paying 20% interest on your credit card I wonder just how good your credit is. I pay 9.65% and have a great FICO.

[rainydayacct]

Do not fall for this SICKENING ADVERTISEMENT.

Credit cards make $$$ EASY MONEY $$$ for the LOAN SHARKS who issue them! They write their own rules & own Congress, just like the oil & insurance companies do!

They rely on a person''s lack of detailed knowledge regarding the agreement''s fine legalese print. Living beyond one''s means is encouraged in their advertisements & being impulsive with a credit card is a likely scenario.

It is very easy to get into DEBT.

This is a new form of SLAVERY.

Do not TRUST this sort of FALSE "REPORTING."

Chase & Capital One are the WORST OFFENDERS when it comes to ripping off customers with bogus rewards.

The BEST REWARDS in life have to do with our connections with PEOPLE not with money.

Financially, your BEST REWARD is to SAVE, SAVE, SAVE MONEY.

Remember, anyone can become homeless. Sometimes this happens because they cannot pay their charged up CREDIT CARD BILLS that feature the phony lure of REWARDS.

BE SMARTER THAN THE AVERAGE BEAR. Dispose of your credit cards & carry CASH! Don''t let the GREEDY BANKERS take advantage of you!

Wishing you prosperity & good health! --RainyDayAcct

[oneworldusa]

Posted by Puzzler125 at 08:08 PM : Aug 09, 2008

-Not sure if you post was in response to my prior post, but no, I don''t have 20-29% credit cards, but most people do. I rarely ever have a balance.

Applying for new credit in today''s economic environment is mostly going to hurt people who would like to buy a home in the next year or two or refinance in the near future.