What Is A Cashback Kredittkort & Should You Get One?
When deciding to get a kredittkort, you’ll have a lot on your plate, as the decision on which one to get is not as simple as it may seem. So many different solutions, types and rewards to offer, and some of the rewards could even be confusing you, leading to you not knowing how they work, what they entail and whether you should actually use them. Cashback credit cards, for example, usually sound quite appealing to most people, but not everyone immediately understands what they are and whether using them is a good idea.
If you’ve had the same dilemmas regarding the cashback kredittkort, i.e. if you’ve been thinking of getting one, but you’re not sure if doing it is right for you, given you don’t know much about the cashback concept in the first place, then here’s some good news for you. Below I’ll explain precisely what those types of credit cards are, aiming at helping you get your facts straight on it all, and figure out if you should get one of these for you or not. While the decision on whether to get one is completely up to you, we’ll still cover that subject below, so as to give you at least some ideas on why it might be a good move.
What Is A Cashback Kredittkort?
Beginning with the basics, credit cards are financial tools issued to users by financial services companies and used to pay for goods and services based on the accrued debt of the card holder. Basically, they allow you to borrow funds, while agreeing on returning it in a timely manner, and with interest. The interest rate will be different depending not only on the type of the card you’ll get, but also on the issuers you’ll work with, since different companies have different rates to offer. In any case, you know precisely how these financial tools work in general, so now it’s time to introduce the term “cashback” in the mix and explain this thoroughly.
Basically, cashback refers to the idea of users earning money by spending money, and since that most likely sounds quite unusual and impossible, let me explain it more clearly. You make a purchase with your credit card and if you’ve chosen one that offers the cashback benefit, you’ll get a percentage of the amount you’ve spent back, thus saving money. Naturally, the purchase usually has to be above a specific threshold for you to receive the percentage back. Not every kredittkort has this benefit to offer, but it is one of the most common ones that people look for when trying to choose the best card for them and the best issuer. Probably because earning money while spending it sounds pretty appealing and it can’t be done in any other way.
Figure out how this precisely works: https://www.bankrate.com/finance/credit-cards/how-cash-back-works/
While there are cards offering a flat percentage of the purchase back, there are also those offer a higher percentage on certain specific categories of purchases, including gas or groceries. The cash you’ll get from this benefit can be redeemed in the form of online purchases, statement credits and some more. Getting money this way is practically like having money gifted to you in a sense, given that other types of financial tools wouldn’t allow for the option of getting a percentage of every single purchase you make back. And although the percentage may seem low or insignificant in the beginning, having this option on your kredittkort is certainly quite beneficial, as you’ll realize after you’ve been using it for some time and after you’ve been getting a lot of your cash back.
Should You Get One?
Getting a financial tool like this one should never be done on the spur of the moment, since not knowing what type you’re getting can later have you regretting your decision. Especially so if you don’t consider the benefits and choose your card based on nothing else but the issuer. I’m not saying that the issuer shouldn’t be taken into consideration and researched. Quite on the contrary, you need to be sure you’re getting your kredittkort from a reputable company, one that’s been in business for a long time and that’s surely legit and trustworthy. Considering nothing but that, though, could result in getting a financial instrument that you won’t like using that much.
Using your credit card, however, can improve your credit score and increase your eligibility for getting a loan should you decide to do so at one point in the future. So, getting it but not using it doesn’t really make much sense, which is why being careful when choosing is definitely a must. Among other things, considering the benefits and rewards you can get and checking out if those are worth it will undeniably help you make the final choice and select the perfect card for yourself.
When cashback is in question, considering the pros of that option is bound to help you determine if it’s the right one for you. The obvious pro, i.e. the fact you get a percentage of the money you spend returned to you, is clear to pretty much everyone already, but it’s not the only thing to have in mind when trying to decide if you want to use this particular tool. Apart from that, most of these don’t charge annual fees, meaning you won’t have to direct a part of what you earn from your cashback kredittkort to paying fees to the issuers, and also meaning you can keep the card open even if not using it for some time, without worrying about incurring debt on those fees.
Sign up bonuses are another perk you can get offered if you go for the cashback card. Naturally, this is not offered by every single company, which just goes to show that you’ll need to be even more thorough while researching those and choosing the best one for you. Most of the great ones, however, do offer a sign up bonus, provided that you meet a certain spending requirement in the first couple of months. You could gain hundreds of dollars on the bonuses, as long as you choose the right issuer and meet those spending requirements we’ve mentioned.
Shopping perks that help you save money, such as extended warranties, return guarantees or refunds, cell phone protection and others, can also come with your cashback credit card. Paying down a big purchase or your existing debt without interest will be another possibility, given that some of these financial instruments have 0% APR offers as well. In any case, getting this type of a card seems to be quite worth it, but considering all those other features of the kredittkor, as well as the trustworthiness of the issuer, is also a must, as it can result in even more great benefits.