You may choose your credit cards for a variety of reasons: convenience, tradition, or happenstance. But if you selected one or more of your credit cards for the perks they offered, are you really taking advantage of those benefits, or are you leaving many of these rewards on the table, which translates into lost dollars.
Billshark wants to show you the many ways you could be walking away from hundreds of dollars in savings, and how to recoup that money. One survey last year found that nearly 20 percent of consumers—primarily millennials—let their credit card rewards expire. Another survey put that figure even higher at 33 percent. A recent U.S. News Money survey reported that nearly half of respondents didn’t take advantage of such typical travel benefits as airport lounge access, trip cancellation and delay insurance, free checked bags, auto rental insurance, and priority boarding.
Other common perks attached to the use of specific cards can include: automatic extended warranties on purchases, automatic car rental insurance, price protection, travel assistance including medical and legal, car buying assistance, cellphone replacement, pre-sale concert tickets, discounts or cash back on groceries, and return guarantees, among many others.
There are two main reasons why consumers don’t take advantage of these benefits, according to financial experts. One, it can be extremely difficult to claim rewards, especially those connected with travel. Anyone who’s ever tried to figure out blackout days and other restrictions on frequent-flier miles will know what we mean.
Two, many people don’t even know what rewards their cards offer. That, unfortunately, is often by design, because these benefits cost the credit card companies money. If you don’t take advantage of them, they’re better off, so they don’t make a practice of reminding you of what you’re missing out on.
To complicate the issue even further, some card companies are now rescinding perks they’ve offered for years. For example, Discover is dropping car rental insurance, extended warranties, and return guarantees, while Chase has eliminated price protection.
Still, most cards offer a number of benefits you may not know about. The key to obtaining the best perks is having good-to-excellent credit, which makes the card companies want to woo and retain you as a customer. Another caveat is making sure you pay off your balances each month, or you could lose the monetary value of all these perks in interest payments.
So how can you be sure you’re getting everything you can from your credit card rewards? Ask. Call the 800-number on the card and ask customer service what perks are available with your card. Or go to the website and scroll around until you find the—sometimes well-hidden—rewards available. Or if you still have your original cardholder agreement, they can be found in the fine print there.
Next, when you do learn about your benefits, set up a system to help you take advantage of them. For example, before a major purchase, check and see whether your card will reward you for it, and whether you have to provide a paper trail to obtain your benefits. If you’re trying to take advantage of travel rewards, find out in advance about restrictions and blackout dates. If you do your homework, you could end up saving hundreds of dollars.
If you find you don’t want or need the perks attached to your primary card, think of signing up for a different one. Again, to receive the best benefits, you need to have good credit. Several websites, including NerdWallet, offer credit card rankings that can help you identify cards with benefits you might be interested in.
Before beginning your search, however, you need to narrow down the types of reward card that will suit you best. If you travel a lot, then you’ll look for cards that feature the types of travel-related benefits mentioned above. If your only travel is to the nearest bus stop, you might want to look for cards that offer cash back points on purchases.
Whichever card you choose, it should at the very least offer low interest rates, and be one that is widely accepted with no annual fees attached. After you find a card that meets those essential criteria, then you can begin to look at the perks offered. Be sure to read the fine print, however: Some cards offer large bonuses when you sign up but these can come with strings attached, such as a minimum purchase requirement in the first three months.
Besides hunting down the rewards you’re entitled to with your current card, the main takeaway is not to be afraid to change cards. Surveys show that most people haven’t changed their primary credit card in over 10 years, even though their needs and life situation may have altered in that time.
By the way, if you do decide to switch to a new card, be sure not to cancel the old one(s). Having a long credit history with each card helps your credit score, as does having an available credit line that you’re not using.
Billshark has many other ways to save you money on your bills. Let our sharks find you hundreds or even thousands of dollars in hidden savings!