Overdue for a credit card makeover

(Consumer Reports)– Cash Back Cards have changed in recent years but many people aren’t reaping the benefits because they’re still using the same old credit card that’s been in their wallet for ages. According to a 2016 survey, 20 million consumers have NEVER changed their preferred credit card and another 25 million have held onto their favorite card for at least a decade.

Loyalty has some of it’s own rewards, but cash back may not be one of them. About half of all credit cards that offer rewards now offer cash back as an option. That’s up from only around 25 percent in 2013.

“While you’re typically looking at one or two-percent back, some cards can go as high as six-percent cash back on certain purchases. And the consumer usually gets to choose how they want to redeem their reward,” Consumer Reports Money Editor Margot Gilman said.

Already using a cash back card? Why not double your effort? Since different cards offer higher rewards for purchases in certain categories, Consumer Reports found using two cards strategically can really boost the benefit — earning you as much as 40-percent more cash back.

“So here’s one strategy. You can use a Blue Cash Preferred Card to get six-percent on groceries and three-percent on gas. Everything else can be charged on a Citi Double Cash Card and get two-percent cash back on all other purchases.”

So how do you know which cards will work best for your wallet? Consumer Reports has a tool on its website.

“First you plug in how much you spend each year in a number of categories. The tool then compares 66 different cashback cards to estimate which will get you the most money back after one year and three years.”

And remember, cashback programs only count if you pay your balance in full. Otherwise you’ll likely rack up more in interest charges than you’ll earn in rewards.

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