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Credit cards do have their perks. Take credit card reward programs, for example. Just for using their card, creditors are willing to give you free gifts, airline miles, college tuition, or even money towards a new car.

What creditors are hoping, of course, is that by participating in their programs, you become a long-term customer.

If creditors are willing to offer these perks, why not take them? With a little insight, you can make credit card reward programs work for you.

PICK YOUR PROGRAM

When you're shopping around for a card reward program, consider rewards you will really use. If you're scared of flying, airline miles may not be your thing. If you are single and have no plans of starting a family, a tuition rewards card does not make much sense. Find a program that will help you reach your financial goals.

READ THE FINE PRINT

When you find a card that has rewards that interest you, be sure to read the fine print. If you can earn a $25 gift certificate, but you have to pay a $40 annual fee, you're not going to come out ahead. If you don't at first find a card with no annual fee, keep looking. There are a lot of them out there.

Be sure there are no other expenses for which you may not be aware. Look at the due date and the interest rate. Look to see if the card requires you make purchases every month, or if it requires you carry a balance on the card. Find out if there are black-out dates for airline miles, or if you can only use a gift certificate online or in a store.

PRACTICE SMART SPENDING

After you're approved for your reward card, be sure to use your card consciously.

After you make a purchase you could (for instance) place the date, place, and dollar amount in your checkbook - just as if you'd written a check. When your bill comes in the mail, simply put the check number for your payment in your check register next to all of your charges. That way you know the money to pay off the card at the end of the month will be there, and there won't be any surprises.

Reward programs work best if you carry a zero balance on your card. The benefits of using the reward card decrease dramatically if you have a 15-percent interest rate on a balance that you carry from month-to-month. Don't put more charges on your card than you can easily pay off in one month.

If you need to carry a revolving credit balance, look for a card that has a limited-time zero interest rate and carry your balance on that card. Use your reward cards specifically to earn rewards.

PAY YOUR BILLS

Many utility companies now allow customers to pay their bills by credit card. Using your reward card to pay your gas, electric, cable, or internet bill can quickly help you rack up rewards. Again, just be sure you're budgeting properly to pay the bill off in full when it arrives.

CLAIM YOUR REWARDS

Rewards won't be rewards if you never use them. Remember to check your balance periodically and claim your rewards. A large percentage of customers with reward cards never actually cash in their points or balances to receive their rewards.

If used correctly, a reward program with your credit card can be one more tool to add to your financial toolkit.

Learn more about this author, Starla Ross.
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