Credit cards are more than just an easy way to pay for purchases. There are all kinds of perks available with them, especially if you have good credit and qualify for the best credit cards.
But not every benefit is as amazing as it may seem. When you’re looking for a new card, it helps to know which features to look for and which ones don’t live up to the hype. After nearly a decade of writing about credit cards, here are what I consider the most overrated benefits.
1. Rotating bonus categories
Lots of credit cards earn bonuses in certain areas. For example, a cash back card could earn 3% on gas and groceries and 1% everywhere else.
Some cards have rotating bonus categories that change every quarter. The bonus rate is usually very high, with 5% being the most common amount. But you never know how useful the categories will be. It could be grocery stores and gyms one quarter, hotels and restaurants the next.
For most people, it’s better to get a credit card with bonus categories that already fit your spending habits. You could also go with a card that earns a flat 2% everywhere. The mystery box approach could work well during some quarters, but there will also probably be quarters where you barely earn any bonus rewards.
You also need to activate your bonus categories every quarter with these cards. While card issuers normally send you reminders to do this, it’s still inconvenient. And if you forget to do it, you miss out on the bonus rewards.
2. Spending credits
A spending credit automatically reimburses certain types of purchases. If a card has a $300 annual travel credit, then the card issuer will reimburse your first $300 in yearly travel purchases.
Spending credits can be useful, but they have a few drawbacks. Most of the cards that offer this benefit also charge hefty annual fees, so you’re not exactly coming out ahead. You’re getting back a portion of that money you paid for the card.
Some spending credits are also hard to use. They might be highly specific. Instead of covering travel as a whole, they could cover airline fees or bookings through the card issuer’s hotel collection. Or instead of yearly credits, a card may offer quarterly or monthly credits, such as a $10 dining credit at select restaurants.
If you’re looking at a card with spending credits, consider how well those credits fit into your everyday life. If they’re going to be a hassle to use, then they aren’t really going to benefit you.
3. Bonus rewards for using the card issuer’s travel portal
This is an increasingly common perk, as card issuers try to get more people using their travel portals. Many Chase cards earn bonus rewards for booking through Chase Travel, Capital One cards earn bonuses for booking through Capital One Travel, and so on. Some cards earn as many as 10 points per $1 this way.
The problem is that these travel portals don’t always have the best prices. Earning more back isn’t worth it if it will cost you an extra $100 or more.
Another reason I’m not a big fan of this perk is because I prefer booking directly with airlines and hotels. This is the safest option. Your reservation is less likely to get lost, and you can contact the travel company if there are any issues. If you book through a travel portal, you need to contact its customer service if anything goes wrong.
Those are the credit card perks that I’ve found least useful. It doesn’t mean cards with those benefits are bad, but you may not want to get a card based solely on those features.