How to make a rewards credit card work for you

If used wisely, a rewards credit card that earns benefits on your everyday spending can be a really valuable addition to your wallet.

To make the most of a rewards card though, you'll need to understand what kind of credit card user you are, what type of card you should have and how the card can work in the context of your lifestyle. Luckily we can help!

What type of credit card user are you?

The most important factor when deciding whether to take up a rewards credit card is to identify what type of credit card user you are:

• If you only use your card on rare occasions - whether for emergencies or big purchases you don't want to pay cash for - and usually repay the balance quickly, chances are you're an Occasional Spender. You'll generally be charged little or no interest, so your focus should be on reducing or eliminating your annual fee with a low fee credit card, as any higher interest rate will have little effect on you.
• If you consistently use your card and have a considerable balance which isn't repaid in full every month you're likely to be a Revolver, due to your "revolving" credit balance. You'll regularly pay interest so you should look for a low interest credit card to minimise how much you're charged each month. You could also consider taking advantage of balance transfer offers which reduce or eliminate interest charges for a set period, giving you time to try and repay your outstanding balance.
• If you use your credit card for everyday spending but, unlike a Revolver, you tend to repay the full balance each month you're probably a Transactor. As you'll have a relatively high spend level and don't need to be worried about the interest rate, you're in position to benefit from using a rewards credit card.

Even though Transactors are most likely to be suited to a rewards credit card, there are other considerations. Rewards cards tend to have higher annual fees, so you'll have to make sure your regular spend is high enough to earn reward benefits that at least cover the amount of the fee.

That said, if you're spending enough on your card and avoiding interest there's no need to change your behaviour, so why wouldn't you want to start reaping the rewards?

How can you maximise your rewards?

Clearly, the more you spend on your rewards credit card the more reward points you accrue, right? Of course, that doesn't mean you should rush out and start buying stuff you don't need just to get the points!

However, you may be surprised how much of your regular everyday and lifestyle spend can go on your rewards credit card.

• Costs like grocery shopping and vehicle or travel expenses can definitely be paid with your credit card.
• You can also set up recurring credit card payments with providers of everything from phone and electricity bills to gym or club memberships.
• Another great idea is to offer to put group bills on your credit card when having coffee or dinner and have your friends pay you back with cash or a bank transfer to your account.
• You may even be able to pay rent on your credit card, depending on your real estate agent.

Once you start to add up all those expenses your potential to earn points becomes a lot more attractive!

What if you have a home loan?

Just because you can't earn points by paying off your mortgage with your credit card doesn’t mean your rewards credit card and home loan can’t work together. Using your card to pay your other expenses can actually help reduce the interest you pay on your mortgage.

It’s quite simple: by paying as many expenses as possible with your rewards credit card you can deposit most of your income into an offset account attached to your home loan. You then take advantage of the interest free days offered on your card to delay withdrawing funds from your offset account to make your credit card payment.

During the credit card interest free period your money remains in your offset accounts, rather than coming straight out of your account when you pay for bills, groceries or fuel. Holding these funds in your offset account reduces the amount of interest calculated on your home loan. Not only do you pay less interest, you’re also paying off your home loan faster.

To get the full benefit of your offset account and interest free days you need to avoid missing credit card payments and incurring interest. To help with this you can set up a monthly transfer from your offset account which pays the full amount owing on your credit card right on the due date. This maximises the benefit of your offset account without the risk of missing a credit card payment.

How can you get started?

The most important part of making a rewards credit card work for you is not changing what you spend, just how you spend it. Similarly, you have to be disciplined enough to make sure you can repay the full balance on time, every month.

At Regional Australia Bank your dedicated Relationship Manager can work with you to structure your accounts and achieve your financial goals while saving you time, money and effort. We can help you accumulate points faster by linking additional cardholders, without any Additional Cardholder Fees. And just in case you are late with your payment, we won’t charge you any annoying Late Payment Fees either!

Visa Platinum Rewards Credit Card is linked to the Qantas Frequent Flyer program, offering 0.75 Qantas Points¹ for every dollar you spend on eligible purchases and an additional bonus point for every dollar spent at Qantas.com or the Qantas Store. You’re also eligible for a complimentary Qantas Frequent Flyer² membership, if you don’t already have one. Other great features include access to the Visa Platinum Concierge Service³ and complimentary Travel Insurance⁴ when you use your card to book a trip.

To see how we can help make your banking work for you, including our Visa Platinum Rewards Credit Card, contact your Regional Australia Bank Relationship Manager or Enquire Online now!

¹ Qantas Points and Qantas Bonus Points accrue in accordance with and are subject to our Visa Conditions of Use.
² This joining fee waiver is offered by Regional Australia Bank. It is available to new applicants who are not already Qantas Frequent Flyer members and who apply for membership online through qantas.com/joinffregionalaustraliabank This offer is non-transferable and not available in conjunction with any other offer. Qantas Frequent Flyer membership and each application is subject to approval.
³ Terms & Conditions apply. See Visa Conditions of Use for details.
⁴ Regional Australia Bank has entered into a group policy for overseas travel insurance with ACE Insurance Limited, A Chubb company (ABN 23 001 642 020 AFSL 239687) The eligibility criteria is set out in the Visa Conditions of Use, along with all information about cover, including full terms and conditions and limits and exclusions that apply.
Not available for businesses, associations or trusts. Terms, conditions, fees, charges and normal lending criteria apply. Please refer to the Visa Conditions of Use when considering if this product is right for you.