Are Credit Cards Rewarding?

Credit cards have always been a controversial topic when it comes to personal finance. Some people think you should avoid them altogether, while others believe the rewards of having them are solid. I tend to think there is a happy medium in there somewhere, but I do think that those who have too many credit cards are just asking for trouble. Diana Ransom, of Smart Money, posted a very interesting article about how credit cards are now becoming much less rewarding in the past few months. The Credit Card Accountability Responsibility and Disclosure Act of 2009 has changed the landscape.

Increased Restrictions on Rewards

While credit card rewards programs aren’t going anywhere soon, cashing in those rewards is becoming more difficult by the day. Experts in the industry say that the most frequent change by the card issuers is to make restrictions and an increased amount of fine print surrounding the back end the reward process. Why exactly is this occurring? The credit card companies are seeing reduced profits because of the CARD act and are looking for ways to offset that.

Pay Close Attention to Reward Rules

The average consumer must now put more time into keeping up with the rules of their credit card, specifically of the reward program. If it seems too good to be true, it probably is. The entire industry is undergoing a major change and I wouldn’t expect any single card company to keep things the way they always have been. The credit card companies are changing their strategy, which means you must adapt as well. Stay on top of your credit card reward program and make sure you get those rewards you earned over time.