This month I’m doing something that I’ve never done before: I’m taking a cruise. A quick flight down to Florida and off we go to the Bahamas to snorkel with the dolphins and eat a whole lot of food that I clearly don’t need. My wife and I will wake up each morning and step out to the balcony of our suite and watch the sunrise.
I’m a little bit stingy with money. I don’t like to spend it on things that I don’t need. One of the most exciting things about this trip is including flights, the cruise, and all of the extras, we’re only spending a little over one hundred dollars.
How, you ask? Rewards points. For more than two years I’ve been saving my rewards points. At the time I wasn’t sure what I was going to spend them on but this was perfect.
I’m amazed at how many people not only don’t take advantage of a rewards credit card but may not even know what one is. The idea behind these cards is simple. You receive a certain amount of points for every dollar you spend. Once you accumulate enough points, you are eligible to purchase merchandise with your points.
Keep in mind that one point is not worth one dollar of buying power. A $50 gift card isn’t going to cost you 50 rewards points. A $50 gift card in one of my rewards catalogs would cost me 5,000 points!
That’s a lot of spending but remember that the option is to spend that $5,000 without anything to show for it. You would use your credit card with or without the rewards points, right? Any points you earn for living your normal life is a very good deal.
Although rewards credit cards are a great way to save money, if you don’t pay your credit card bill in full each month, the interest you’re paying is cancelling the potential financial benefits you would gain. It still pays to have a rewards credit card if you’re paying interest, but your rewards are simply paying a small portion of your interest.
How many rewards points did it take to pay for my cruise? It took a few years to accumulate the points and if I had that amount of rewards points in actual dollars, I could take 4 or 5 cruises but if you employ a few key strategies, it doesn’t take as long as you would think.
You may have already been on a cruise but this is my first so my friends are probably tired of hearing me talk about it. Nothing tastes better than something that is free. The fact that this vacation is costing me very little is a penny pincher’s dream come true. If anybody tells you that a rewards credit card isn’t worth the time or the annual fee, send them to me. I’ll tell them how blue the water was.