Current Events and Blog

18Jul 2018

The card rewards strategies issuers can use to win top-of-wallet status while maximizing returns – Business Insider


This is a preview of a research report from Business Insider Intelligence, Business Insider’s premium research service. To learn more about Business Insider Intelligence, click here.


BI Intelligence

The average US consumer holds about three nonretail credit cards with a balance over $6,000, according to Experian. As confidence rises, spending is hitting prerecession levels. For banks, that should be a good thing, since credit cards are profitable. But the push to attract a particularly interested and engaged customer base through sign-up bonuses and lucrative rewards offerings has led banks into a rat race, with surging expenses and rising delinquencies that are hurting returns.

To make credit cards as valuable as they could be, and to bring returns back up, issuers need to direct their efforts not just toward becoming one of consumers’ three cards, but also toward becoming their favorite card. Rewards are more important than ever — three of the top four primary card determinants cited by respondents to a Business Insider Intelligence survey were rewards-related — so abandoning them isn’t effective.

Instead, issuers need to be more resourceful with their rewards offerings, focusing on areas that encourage habit formation, promote high-volume spending, and help to offset some of the rewards costs while building engagement and loyalty.

In this report, Business Insider Intelligence sizes the US consumer credit card market, explains why return on assets (ROA) is on the decline, highlights the importance of rewards in attracting customers, and lays out three next-generation rewards strategies that are popular among certain demographics, which issuers can implement to return their card business to profitability. To drive this analysis, we conducted a survey centered on users’ card preferences to over 700 US members of our proprietary panel in May 2018.

Here are some key takeaways from the report:

  • Competition driven by consumer card appetite in the US is hurting issuer returns. Consumer confidence and regulatory policy that favors credit cards should be a boon to issuers. But the competition has surged expenses to unattainable levels and increased delinquencies, which are causing returns to trend down.
  • Consumers still value rewards above all when it comes to cards. Two-thirds of respondents to our survey cited rewards-related offerings as the leading driver of primary card status, but they can be pricey for issuers.
  • Using resources strategically and offering rewards types that encourage high-volume spending and drive engagement through habit formation, like flexible offerings, rewards for e-commerce, and local bonuses, could be the path to success in the future.

In full, the report:

  • Identifies the factors that are causing high credit appetite to hurt issuer returns.
  • Explains the value of top-of-wallet status, and evaluates the factors that drive it based on proprietary consumer data.
  • Defines three popular next-generation rewards options that issuers can use to drive up spending and engagement without breaking the bank.
  • Issues recommendations about how to offer these rewards and what demographic groups could be most receptive to them.

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18Jul 2018

New York-London in 3½ Hours? Supersonic Travel May Be Back – Wall Street Journal


Boom Technology wants to cut the time for transcontinental trips by more than half.


Photo:

Ferrari/Zuma Press

FARNBOROUGH, England—Fifteen years after the Concorde last flew, supersonic air travel is back in the aerospace industry’s sights.

Investors, plane makers and equipment suppliers are pushing to revive superfast airliners and business jets. The big questions: Will regulators go along, and will passengers be willing to pay? The Concorde cut the time to fly from New York to London or Paris to about 3½ hours, about half today’s typical journey. But it was an economic failure.

The latest efforts, highlighted by exhibits and discussions at the international air show here, reflect support from major aerospace companies, buttressed by promising research into reducing the sonic boom that occurs when planes exceed the speed of sound.

Backers include

Boeing
Co.


BA 0.44%

,

Lockheed Martin
Corp.


LMT 0.37%

and closely held Colorado startup Boom Technology Inc., which aims to start flying a reduced-size demonstration craft late next year. An initial goal for Boom’s proposed airliner is to slash the time for transcontinental trips by more than half. Round trips between the U.S. West Coast and Asia could be completed within the same day, for business travelers—the plush cabins would offer only premium seats—in a real hurry.

“This was the future we were all promised,” said

Steven Isakowitz,

president of Aerospace Corp., a nonprofit think tank for the Pentagon. In an interview earlier this month he cited both technical advances and “extremely interesting” NASA research into reducing the shock wave and noise.

“It’s going to be doable,”

Dennis Muilenburg,

Boeing’s chief executive, said in an interview at the show. He expects supersonic technology to be “viable within the next decade,” and that further advances will eventually allow flights connecting cities around the world within several hours. The bigger challenge is the economic case, he added: “Are there enough travelers who would pay a premium to fly faster?”

Boeing is still trying to answer that question. Will twice as fast be enough, “or do you really have to go a lot faster on a longer route?” asked

Greg Hyslop,

the company’s chief technology officer.

Weeks ago, Boeing unveiled a concept for a passenger-carrying hypersonic aircraft, theoretically capable of flying many times the speed of sound. But some experts predict it could be two decades away. Boeing declined to provide a timeline.

For Boom’s founder and chief executive,

Blake Scholl,

a decade is too long to wait. Buoyed by some early orders plus a strategic investment from

Japan Airlines
Co.

, Boom has also benefited from the afterglow of successful startups such as

Elon Musk’s

SpaceX.

Mr. Scholl said his company, which is roughly two years behind its original timetable, wants to end the era of air travel that is “low on excitement, low on progress and high on frustration.”

Closely held Aerion Supersonic has spent 16 years developing a super-swift business jet.

General Electric
Co.

and Lockheed Martin are backing plans for the latest version, the three-engine AS2, which aims for a maximum “super cruise” speed 1.4 times the speed of sound.

Among the prime marketing targets: People wealthy enough to pay a premium for speed “because they can,” chief executive

Brian Barents

said in an interview Tuesday.

An Air France Concorde taking off in 2001. The supersonic jet made its last flight in 2003.

An Air France Concorde taking off in 2001. The supersonic jet made its last flight in 2003.


Photo:

Eric feferberg/Agence France-Presse/Getty Images

Many proposals for supersonic airliners and business jets have surfaced and sunk over the years, brought down by reasons from high fuel prices to environmental concerns to Concorde-era rules barring civilian aircraft from breaking the sound barrier over U.S. territory.

Supersonic proponents have recently stepped up lobbying of lawmakers. In addition, the Federal Aviation Administration has moved to begin a public dialogue over regulations.

The current debate isn’t over lifting the ban on breaking the sound barrier over land. Rather, it is about waiving or revising noise restrictions on planes climbing from or descending toward U.S. airports to begin or end supersonic routes over water.

Some recent innovations have prompted the FAA to consider whether there is a possibility of reintroducing supersonic flight, Carl Burleson, the agency’s acting deputy administrator, told a federal advisory group earlier this summer.

A fact sheet posted on the FAA’s website in May says “lighter and more efficient composite materials, combined with new engine and airframe designs” may make supersonic transport viable, so the agency plans to propose new rules. One would cover “the range of permissible supersonic operations”; the other, the procedures for gaining authorization for supersonic flight tests.

Write to Andy Pasztor at andy.pasztor@wsj.com, Robert Wall at robert.wall@wsj.com and Andrew Tangel at Andrew.Tangel@wsj.com

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18Jul 2018

How do I get out of $50000 in credit card debt: personal loan or repayment plan? – USA TODAY


Question: I’m 64. My credit score is about 656. For different reasons over a long period of time — including unemployment and health issues — I accumulated credit card debt of about $50,000. 

I intend to take out an unsecured personal loan, but I don’t want it to have a negative impact on my credit score. I have a job now and I will pay my monthly payments on time. But what will happen if I cannot continue my payments to the lender? If I should file for bankruptcy, which is worse: defaulting on credit card debt or an unsecured personal loan?

If I try to negotiate a reduction of my debt with the creditors, do you think this procedure will be successful and not take too long? And what is a nonprofit debt relief company/agency, and how could they help me? 

Bottom line: What strategy would you implement to resolve the debt problem if you were in my place? Do you think I could avoid bankruptcy?  

Answer: An unsecured personal loan can be an effective way to consolidate debt without hurting your credit score, as long as you can make all the payments on time, says April Lewis-Parks, director of education and corporate communications at Consolidated Credit, a credit counseling organization. 

Depending on the term you choose, Lewis-Parks says this option may also reduce the monthly payment amount, “which can help because it allows you to balance your budget so you can stop making new charges and focus on debt repayment.”

That is key, she says, because if you use a loan to consolidate, it zeros out your credit card balances but typically leaves the accounts open. “As a result, you can run up new debt before you pay the loan off,” Lewis-Parks says. “This is why it’s critical to create a budget that ensures you can live without using credit cards until you at least have your debt completely paid off.”

According to Lewis-Parks, should you default on your unsecured personal loan, the lender would have to sue you in civil court to get a judgment that would force repayment. “However, the worst outcome you could expect would be that the judge would order something like wage or tax refund garnishment,” she says.

More: Student loan debt: 7 steps to pay it off

More: 9 things to know about your credit score and how it’s calculated

More: Stressed about your finances? Suggestions on what to do and who to ask for help

Lewis-Parks also says you can try to negotiate repayment plans on your own with each individual creditor. But results may vary, she says. Success in negotiation depends on the creditor, your history as a customer, the current status of your debt and even who you talk to in the customer service department.

If you decide to negotiate with your creditors, make it clear that you want to repay everything you charged in full, says Lewis-Parks. “If you settle for any less than the full amount owed, then you will damage your credit,” she says. 

As for your question about a nonprofit debt relief company/agency, or what is also known as a credit counseling agency (such as Consolidated Credit). “These organizations basically offer a professionally assisted repayment plan,” she says. “It’s not a loan because you still owe your original creditors.”

The agency talks to each of your creditors to set up a repayment plan and reduce or eliminate interest charges. It’s the same as you negotiating with individual creditors on your own, except the agency has the ability to negotiate a single repayment plan that covers all your debts, she says. 

“The agency simply takes your payment and distributes it to your creditors according to the negotiated repayment schedule,” she says. 

Lewis-Parks notes that these agencies also have established relationships with creditors and proven records of helping other consumers get out of debt.

“As a result, they often have more success negotiating on your behalf than if you try to negotiate on your own,” she says.

There are other advantages to using a professional nonprofit debt relief company as well, she says.

“First, once you set up the repayment plan, all of your credit card accounts are frozen until you pay off your debt,” says Lewis-Parks. “This may seem like a disadvantage, but it keeps you from making new charges, which is one of the biggest pitfalls of consolidating debt on your own.”

What’s more, the credit counseling team will also help you set up a budget, so it’s easier to manage your money and live credit-free while you’re enrolled. “These programs are often more effective at helping people break bad credit habits,” she says. Working with a nonprofit debt relief company should also not damage your credit as long as the plan is set up correctly and you make all your payments on time, she says.

Fees charged by the agency are based on a person’s budget, how many credit cards they have and how much they owe. The average client pays about $40 a month, she says. And while the fees vary state by state, they’re limited to $79 a month. 

The good news is that, given the situation described, the creditor in question should be able to avoid bankruptcy, says Lewis-Parks. “And as long as you repay everything you charged in full and avoid debt settlement, you shouldn’t damage your credit either,” she says. 

As for which option is better — unsecured personal consolidation loan or repayment plan — that really depends on you and your budget.

With $50,000 to repay, you are right at the cusp of what most people can afford to repay with an unsecured personal consolidation loan, says Lewis-Parks. Plus, you’ll likely need to use the maximum term to get payments you can afford, which is usually 48 to 60 payments, depending on the lender.

“On the other hand, the repayment plan that you enroll in through a nonprofit debt relief company is designed to help consumers deal with larger volumes of debt,” she says.

“Some of these companies even work with people who owe over $100,000 and they still help them successfully set up a repayment plan that pays off everything they owe. These plans typically run for 36 to 60 payments, depending on the monthly payments you can afford.”

So, it’s up to you, says Lewis-Parks. “If you can afford the monthly payments on an unsecured debt consolidation loan and you think you can balance your budget and stop charging, then you may be able to go it alone,” she says. “However, if you’re concerned you won’t be able to stop charging, do-it-yourself consolidation can be risky.”

The silver lining, she says, is that if you try to consolidate on your own and start to run into trouble, you can still decide to work with a debt relief company. “They can consolidate debt consolidation loans, along with any new credit card debt you took on after consolidation,” says Lewis-Parks.

Robert Powell is the editor of TheStreet’s Retirement Daily and contributes regularly to USA TODAY. Got questions about money? Email Bob at rpowell@allthingsretirement.com. The views and opinions expressed in this column are the author’s and do not necessarily reflect those of USA TODAY.

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18Jul 2018

Las Vegas and Orlando are the Cheapest Places to Fly – NerdWallet (blog)


Those looking for a cheap vacation should consider flying to Las Vegas or Orlando, Florida. Data released by the U.S. Department of Transportation Bureau of Transportation Statistics (BTS) on July 17, 2018, revealed those two destinations have the lowest airfares in America.

Across the country, the average airfare cost $346.49 during the first three months of 2018. The price dropped $5 from the same time last year. But fares were still higher compared to last summer, when the average was $335.

» Learn more: Beat your travel budget: Find cheap activities in any city

Over the winter months, the warm destinations of Las Vegas and Orlando were among the most frugal. Flights to and from Las Vegas McCarran International Airport averaged $242.41, while trips to Orlando International Airport cost around $246. Frequent flyers could also fly to Denver, New Orleans and Tampa, Florida, for less than $300.

Location, location, location

When traveling to big cities, getting the best domestic deal has more to do with location than date. Although airfare across New York was $375, those going through LaGuardia Airport paid an average of $320.45. LaGuardia airfare was lower than both John F. Kennedy International Airport ($397.54) and Newark Liberty International Airport ($407.59).

The same pattern appeared in San Francisco and Washington, D.C. In the Bay Area, passengers taking the train to Oakland International Airport paid the lowest regular airfare ($272.73), while those flying through the capital from Baltimore-Washington International Airport paid the lowest prices ($310.95). Discounts at both airports were around $40, compared to the other regional options.

» Learn more: How to get started with frequent flyer programs

Both underserved airports and hub cities reflected the most expensive in the nation. The costliest city for flights was Fayetteville, Ark. The average ticket price from Northwest Arkansas Regional Airport cost $511.11 — more than the college towns of Madison, Wisconsin, Knoxville, Tennessee, and Greensboro, North Carolina. Also high priced were the airline hub cities of Charlotte, Detroit and Houston: While ticket prices out of each topped $380, fares through Charlotte cost just over $429.

To find the average ticket value over the first three months of 2018, the BTS calculated the average of both one-way and round-trip fares, including taxes and fees. Data was weighted toward round-trip tickets. The average domestic air fare does not consider other fees or ticket types, including those for checked luggage, seat selection or points awards.

How to maximize your rewards

You want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2018, including those best for:

Planning a trip? Check out these articles for more inspiration and advice:
Don’t Let Hidden Hotel Fees Spoil Your Stay
How to snag credit card rewards flights in peak season
Landing the best airfare is a matter of timing

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17Jul 2018

Amazon Prime Day 2018: Top Deals On Travel Essentials – Forbes


Prime Day deals featured in this post may change or sell out. We will continue to update this post with new deals and updated pricing.

Summer is in full swing, which means weekend getaways and family vacations are among us. Amazon’s Prime Day is the perfect time to stock up on your travel essentials and the fundamentals for your upcoming trips. We’ve compiled some of the best travel sales and deals on Amazon today so you don’t need to waste any time hunting for the lowest prices.


eBags Professional Weekender

This versatile and sleek bag is perfect for business travel and weekend trips. The many compartments allow you to easily stay organized. With a hard compartment for your chargers and a sleeve for your laptop, you don’t need to worry about important items breaking or getting damaged.

Shop Now: $99 (orig. $159)

Here are some other great eBags deals on Prime Day:


HUANUO Universal Travel Adapter

If you plan on traveling outside of the country in upcoming months then a travel adapter is a necessity. This travel adapter works in over 150 countries and has four USB ports, so you won’t need to worry about carrying around an excess of plugs.

Shop Now: $13 (orig. $18)


BCOZZY Chin Supporting Travel Pillow

Shop Now: $20 (orig. $30)


DEW Travel Wallet

The DEW Travel Wallet holds you and your family’s important travel documents, passports, credit cards, money, and keys.

Shop Now: $12 (orig. $15)



Bose QuietComfort 25 Acoustic Noise Cancelling Headphones

Shop Now: $125 (orig. $300)


Contigo Mugs

Shop Now: Up To 54% Off


Double & Single Camping Hammocks

Save over 50% on these highly-reviewed hammocks that are perfect for camping or just setting up in your backyard. They are ultralight, travel friendly and can be set up in less than three minutes.

Shop Now: $21.97 – $32.97 (orig. $48)


Coleman Sundome 4-Person Tent

Shop Now: $52 (orig. $65)


LifeStraw Personal Water Filter

A Time Magazine Invention of the Year Winner, the Lifestraw Water Filter removes 99.99% of all bacteria and parasites and is 60% off today.

Shop Now: $10 (orig. $25)


AmazonBasics Double Braided Nylon USB A to Lightning Compatible Cable

Shop Now: $10 (orig. $15)


AmazonBasics Universal Travel Case for Small Electronics and Accessories 

Shop Now: $7 (orig. $11)


Kindle Paperwhite E-reader – Black, 6″ High-Resolution Display

Shop Now: $80 (orig. $120)

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17Jul 2018

Here's how many credit cards people with excellent credit scores have – CNBC


How many credit cards should you have if you want an excellent credit score? According to Ethan Dornhelm, vice president of FICO Scores and predictive analysis, there’s no perfect number.

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A credit score is a personal rating that determines the interest you pay for a loan, or whether you qualify for a loan at all. It’s calculated based on payment history, how much you owe, your length of credit history, the types of credit you have and how often you apply for new credit.

“The sheer number of credit card accounts that a consumer has is much less important to the FICO Score than how the consumer is managing those accounts,” Dornhelm tells CNBC Make It. “Are they paying their bills as agreed? Are they keeping their balances low relative to available credit limits? These actions are the most significant drivers of their FICO Score.”

Still, it’s useful to consider the wallets of people with great credit. In a recent analysis, FICO found that cardholders with scores above 800 — the excellent range is 750 to 850 — had an average of three open cards, according to Dornhelm. If you include both open and closed accounts, they’d had six cards in total.

Since the number of cards you have can affect your credit score in subtle ways, as well as impact how much you earn with different types of credit card rewards, here are three things to keep in mind when deciding whether to get a new card.

Adding a new card is one way to increase the credit available to you, which allows you to spend more while still maintaining a safe utilization ratio, or the amount you’ve spent compared to your credit limit. “The lower your ratio of balances to your total credit limits, the better,” says Dornhelm.

As a rule, you should try to keep your utilization ratio below 30 percent. You can figure out what it is by adding up your monthly spending — the balances on all your cards — and dividing that number by the sum of your limits. For example, carrying a balance of $200 and having a credit limit of $1,000 would give you a utilization ratio of 20 percent.

If the ratio is too high, getting a new card could lower it since it raises your total credit limit — as long as your spending stays the same.

If you do get a new card, don’t rush to cancel your old ones. Over time, closed accounts are no longer included on your credit report, which could reduce the “average age” of your account. Plus, “by closing a credit card account, the consumer is taking some of their available credit off the table,” says Dornhelm. That could have a more immediate impact on your credit score.

Open yet inactive accounts, on the other hand, won’t harm your score. In fact, they might help it by increasing your available credit.

There are some situations, like when a card you’re no longer using has an annual fee, where it might be worth closing the account, not for the sake of your score but to save money. Even in that case, though, there can be loopholes.

“You may be able to ask the credit card issuer to waive the fee or convert the account to a card product that doesn’t have an annual fee so you can preserve the account age on your credit reports, which can be better for credit scores,” John Ganotis, founder of CreditCardInsider.Com, tells CNBC Make It.

Savvy spenders may use multiple cards to rake in different kinds of rewards. “Someone might want a card that earns more cash back in certain categories, like groceries or gas, and another card that earns a flat cash back rate on all purchases to use for spending in categories where the first card wouldn’t earn more,” says Ganotis.

So if you’re looking for a new card, consider one that offers new perks and rewards to complement the cards you already have. Just keep track of your annual fees to ensure the rewards are actually worth it. And do your research before you apply to make sure it’s not only one you want but one you’re qualified for, since the application process requires a credit inquiry. One of those usually shaves a few points off your score, though nothing drastic.

If you’re happy with your current benefits and credit line, there’s probably no reason to complicate your situation with a new card.

Don’t miss:

We looked at the 35 most popular travel credit cards—here’s our pick for No. 1

Like this story? Subscribe to CNBC Make It on YouTube!

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17Jul 2018

SalamAir Launches More on Air Frequent Flyer Programme – Travel Trade Daily


SalamAir launched its first-ever frequent flyer loyalty programme, More on Air. Guests can now redeem 10 boarding passes collected within one year for an one-way airline ticket to any of SalamAir’s 12 destinations.

Mohamed Ahmed, CEO, SalamAir, commented, “With the introduction of More on Air, we want to reward guests for their loyalty, while providing them with more opportunities to fly.”

Guests who have flown a total of 10 sectors within one annual year on SalamAir starting from January can redeem their boarding passes for a one-way ticket to anywhere the airline flies. Passes can be redeemed through SalamAir’s ticket office at Muscat International Airport, Salalah International Airport, through SalamAir General Sales Agent Office both in and outside of Oman.

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17Jul 2018

Former Defense Secretary Hagel On Risks, Rewards Of Helsinki Meeting – NPR


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17Jul 2018

Amazon Prime Day 2018: Travel Essentials to Buy Right Now – Condé Nast Traveler


Amazon Prime Day 2018, the site's fourth-annual sale for Prime members, has arrived—and with the summer travel season in full swing, there's a ton of packing essentials to snap up before the sale's 36-hour window ends. However, knowing where to start shopping can be overwhelming, so we've scoured Amazon for the best deals out there. Plan to play hooky by the pool and need a waterproof speaker? We've got you. Time to replace those sneakers? We dug up the perfect pair. Desperate for an inflatable kayak? Well, we found that for you too. Here, our 12 favorite travel essentials on sale right now.

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17Jul 2018

Secrets of credit card super users – CNBC


When Jeremy Steiner, 30, was ready to propose to his now-fiancé, Kaja Olcott, 29, he first made another commitment:

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A new credit card.

Steiner signed up for the Capital One Venture card in order to earn 50,000 miles (roughly the equivalent of $500) when he purchased an engagement ring. The card also comes with hotel upgrades, concierge services and waives foreign transaction fees for travelers abroad.

All of that will come in handy since the couple is planning on an African safari honeymoon in January (she said yes, by the way).

Over the past few years, card issuers have upped the ante with better rewards and sign-up bonuses to attract customers. And in return, some credit card holders are wising up to the benefits game.

Steiner is one of a growing number of savvy shoppers maximizing reward cards, which dole out points when you make purchases at airlines, gas stations and restaurants, and saving money — or in some cases making money — as they make purchases they would do in any case.

And card issuers are taking notice.

J.P. Morgan Chase last week said its credit-card customers were redeeming points faster than anticipated, resulting in a $330 million charge in an otherwise positive second-quarter earnings report

Despite the uptick, only a select few are taking advantages of all the perks that reeled them in, according to Bill Hardekopf, credit card expert and CEO of Lowcards.com.

U.S. consumers collectively hold 3.8 billion memberships in loyalty programs, up from 3.3 billion in 2015, according to data from research firm Colloquy. But more than half of those memberships, or 54 percent, are inactive, and 28 percent of consumers have abandoned a program “without ever having redeemed a point or mile.”

“At the very least, you should be earning at least 2 percent back on all of your purchases,” said Greg McBride, the chief financial analyst at Bankrate.com.

To boost your earning potential even further, Lee Huffman, a senior analyst at of reward-comparison site RewardExpert, recommends grouping an airline card that offers free checked bags and priority boarding with a cashback card, such as Citi Double Cash, and a rotating card like the Chase Freedom or Discover It, which offers up to 5 percent back in a variety of categories that change throughout the year. For those in the know, this is referred to as “stacking.”

(To keep taps on the rewards, Huffman suggests affixing a sticker to the back of each card with its benefit: For example, “2x on groceries” or “3x on gas.”)

If you don’t take full advantage of the rewards, many offers do not make sense, Huffman said.

Depending on how much you spend each month, signup bonuses and other rewards don’t always offset the cost of an annual fee, which can be as much as $450 depending on the card, according to personal finance site WalletHub. (Don’t rule out a card entirely because of the fee, either. Often these cards have better initial bonuses and higher earning rates than cards without a fee.) CNBC Make It has ranked the best travel and cash-back cards.

You must also be able to hit the minimum spending requirement to reap any rewards at all, which is generally $2,000 to $3,000 over the first three months. The popular Chase Sapphire Preferred comes with a 50,000 point rewards bonus — if you spend at least $4,000 within the first three months of opening your account.

“All of these initial bonuses come with a caveat,” Hardekopf said. “Make sure you read the terms and conditions.”

The same goes for the interest rate, or APR, which is generally higher for rewards cards to compensate issuers for the additional perks.

“If you carry a balance even occasionally the interest rates will wipe out much if not all of the reward benefit you are earning,” McBride said.

And some of the most enticing offers are only available to those with good or excellent credit. In addition, opening and closing cards purely to snag the initial sign up bonus can ding your credit score if you are not careful. (One of the key components of a score is your credit history, which is the length of time you’ve had accounts open.)

More from Personal Finance:
Credit card debt hits record high
Your credit card’s secret perks
Credit card debt can be bad for your health

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