6 Red Flags to Look for in Credit Card Reward Programs

By Ashley Sepanski

Rewards cards are an excellent way to make the most of your travel, but make sure you’re not falling into one of these financial traps.

1. It Has a Ridiculous Annual Fee

The MasterCard Gold Card might look pretty with its 24K sheen and $200 yearly airfare credit, but there’s a reason it was voted 2018’s worst reward card by WalletHub: The appalling $995 annual fee. We agree that any yearly charge to pay for the rewards a credit card provides feels a bit sketchy, but overall, it’s fairly normal. (Just not at this high of a price!) Avoid the annual-fee trap by doing the math before you apply to make sure what you’re getting is worth more than what you pay each year.

2. The APR Comes Out of Nowhere

Roughly translated, APR is the rate of interest you pay on any unpaid balance at the end of each month. Many rewards cards offer 0% APR for the first couple months. As the months pass, though, the interest rate can jump to 21% APR – that’s an extra $210 per month on a $1,000 balance. Aim for cards with the lowest continuous interest rate to save in the long run, no matter how great the rewards may be on what you spend.

3. You Have to Pay a Fee Even Before You Get the Card

If you’re required to pay a processing fee just to get your hands on the card, you can probably expect a lot of other hidden fees as well. Save yourself the trouble and look for another option.

4. It Promises No Blackout Dates, And That’s It

Although a card promises you can use miles or points on any day of the year, that doesn’t mean rewards seats will always be available to you. According to travel writer Chris Guillebeau, lack of availability can mean you spend way more of those precious miles than you want to. If earning miles is the only benefit the card offers, you might want to keep browsing. VentureOne pride itself on having no blackout restrictions and actually helping you use your rewards when you want to use them.

5. They Promise a Low Minimum Payment

Paying the minimum on any credit card is often a one-way ticket to a wrecked credit score and piles of debt. Your goal should be to pay off your balance in full every month, not only to avoid interest payments, but to keep yourself on track. If you need the extra push to keep up with your payments, consider an American Express Premier Rewards Gold Card. The card comes with perks like travel credits and discounts (not to mention you earn points on every purchase), and customers are encouraged to pay in full each month.

6. Rewards Are Restricted

While many rewards programs promise free travel benefits that sound enticing, some have limitations on how many rewards you can earn, or even forfeit your rewards if you don’t use them by a certain date. Look for cards that do not have maximums on how much you can earn. And be on the lookout for programs that rollover your reward points if you don’t use them within a year. Both Discover and Capital One rollover rewards as long as you keep your card active.