Are points credit cards worth the rewards?

Points credit cards can be an attractive option for Australians looking to stretch their spending further, particularly as many people plan their next overseas trip.

But access to rewards like frequent flyer points and retail gift cards can come with serious risks if you’re caught unaware. Considering the hefty fees and the temptation to overspend, these cards are not the best option for many.

Dawn Thomas, a senior financial adviser at The Wealth Designers, provided her insight into this issue in a discussion with Matthew Elmas of The New Daily.

Dawn advises that it’s easy for consumers to get confused by points cards, which can land people in trouble if they go into a contract without a firm plan for their spending.

“If you’re using these rewards cards you need to have very strong cash flow management behind you to avoid incurring the purchase interest.”

According to 2018 Reserve Bank figures, the majority of credit card customers are paying more in fees and interest than they’re getting back in rewards.

Some tips we suggest are:

Treat your credit card like a debit card
Pay off your spending as you go
Never miss a bill payment

Read the full article here: https://www.thenewdaily.com.au/preview?p=1759310