2018年10月30日

Without Reading the Fine print

You Take Advantage of Your Credit Card’s Rewards program Without Reading the Fine print
It's so easy to get lulled into fantasy land when you feel the need for the beach and the sound of the ocean. There's nothing wrong with using your rewards card if you have the money to pay off the balance when you get back home.

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But there are some rewards programs that don't look like they're debt traps. For instance, American Express has a Fly Now, Earn Later program. You can take the trip of your dreams even though you don't have the miles saved up to pay for the ticket.


OK, you're basically buying a ticket on credit that you have to pay for within the next six months. For savvy consumers, this might not be a problem. You know you'll spend enough with the card to earn the miles before it's time to pay the bill.

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But what if things don't work out that way? If you haven't earned the miles within six months, you'll get charged for them at 2.5 cents per mile. At, say, 10,000 miles short, that's $250. The annual percentage rate for this charge will be the same as your purchase ApR.


If you can pull this off without losing a dime, then more power to you. But I don't think it's ever a good idea to take a trip now and pay for it later. You just don't know what will happen between now and later.

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If it's an emergency, such as a death in the family, and you can't afford the ticket today, then that's an acceptable reason. And even then, when you get home, focus on earning those miles back within six months.


The next one is also travel-related, but involves installment payments.


Related articles:


Rewards Can Help With Expenses


How to Successfully Manage Two or More Credit Cards


More Than One Credit Card Isn't for Everyone


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