Cash Back Credit Card Disadvantages
Cash Back Credit Cards apart from having a lot of advantages, has its own disadvantages. The credit card customers who have been using the cash back facility for quite some time and financial advisers will be able to pinpoint the disadvantages involved with these type of cards.
Cash Back credit cards encourage the customers to keep on spending a lot just for the sake of getting cash back or reward points. They do not see the hidden drawbacks. You are forced to buy things above your needs. You are forced to buy things which are costly and there s no need for you to go in for that. This will keep adding on to the amount you need to pay back. Unnecessarily you will pay for things which you actually had no need for. You are actually getting trapped and ultimately become burden with debt.
Some of the cash back cards will allow you to build your cash back rewards very slowly. This means that you need to spend a lot on your card inorder to achieve the reward points. They come with a lot of attractive schemes saying if you reach a certain limit you can have the benefits. This will force you to spend more and buy more. If there are extra charges levied on your card then you should understand that it is not worth spending just to get the reward points.
Some credit cards offer coupons as cash back reward to only some specific store. This will not be of great value to you. You may not need the products in that store and you will forced to buy the same. In this way you are once again adding to amount you need to pay back. This will be burden to you and you will realize your mistake only when the amount gets accumulated and becomes huge and difficult for you to pay back. There are some cards which offer rewards only for a specific period of time. If you do not make your purchases within the specified period, you have to once again start building up your reward points from scratch, which becomes painful.
There may be times when you will find getting reward points or redeeming you rewards by means of cash very complicated. You will realize then that it was not worth it any way and you may not be getting any of the bonuses.
There might be some ineligible purchases. Some cards would declare that there are no reward points given to some of the purchases that you make. This can be some online purchase or even some purchases related to tobacco or alcohol products. If a lot of products like this is waived of from getting the reward points, then it would take a long time for you to get good cash back rewards.
Above all you should see to it that you make the payments on time before the expected date. If not the cash back reward that you get will be eaten up by the interest that is levied on late payments and other charges
