Jan 14, 2009 12:04 pm US/Eastern
Your Money Team: Unique Rewards Programs
PHILADELPHIA (CBS 3) ―
Airline tickets, hotel stays, car rental, rewards cards have been around for years. The CBS 3 Money Team has learned about some new credit card rewards programs you may not have heard about.
3 On Your Side's Jim Donovan shows you how some companies are offering different incentives that will save you money down the road.
Alexis Rice occasionally misses paying her credit card bill by a day or two and cringes at the late fees.
So she signed up for a new reward service that helps keep her credit card payments on time.
"It's so confusing knowing when my bill date is that now it will just be automatically taken out of my checking account on a monthly basis," Rice said.
The service is from American Express, one of several lenders offering new features from money management tools to savings incentives.
"The trend in credit cards is moving away from rewards that are really leisure based -- you know, free airline tickets, free hotel stays -- to things that are more practical," said Ken Clark, certified financial planner and author.
Schwab's "invest first" card gives you two percent cash back on purchases. Then, those rewards can be deposited into your brokerage account. Fidelity's "retirement rewards" card also helps build your nest egg.
"The card features a 2 percent earn rate on all purchases that can be applied to a cardholder's ira," said John Ragnoni with Fidelity.
Other companies, like Wells Fargo, allow homeowners to apply cash back toward what is typically their biggest bill.
"The Wells Fargo card rewards us with a 1 percent contribution toward our mortgage principal. The downside is you have to have a wells fargo mortgage," said Clark.
If you're looking to manage your debt, Discover's Motiva card rewards consumers who carry a balance but pay on time.
"Every time a card member makes 6 on-time monthly payments in a row, they receive their next month's interest back as a 'pay on time' bonus," said Kelly Tufts with Discover Card.
The company has also rolled out the 'paydown planner', one of many web applications that calculates how long it will take to hit zero.
Before picking any card, watch those interest rates. Also read the fine print and ask plenty of questions before applying for one of these credit cards in order to figure out which one is best for you.
(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)
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