5 Credit Card Myths That Could Prevent You From Maximizing Rewards

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  • In researching applying for a new credit card, I’ve discovered some myths I didn’t know about.
  • For instance, you can open multiple rewards credit cards and still maintain a good credit score.
  • Rewards from travel credit cards can also come in handy, even if you’re not traveling.
  • Read Insider’s guide to the best rewards credit cards.

One of my goals in 2022 is to open up a new personal credit card. After being loyal for six years to one credit card with limited benefits and a stale rewards program, I want to get a new card that offers more.

I’ve spent the last few months not only researching which credit cards are a good fit for my spending habits and goals but also about some of the most common myths that surround reward programs that I didn’t know were false.

Read more: Guide to the best current credit card offers

In an effort to make sure I’ve wrapped my head around credit card reward programs so that I can maximize how I use the benefits that come with my new card, here are five myths that I’m going to stop thinking are true.

You won’t earn rewards while carrying a balance

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It made sense to me that even though you spend money on your credit card and earn points throughout the month, those points aren’t really yours to keep and use until you pay the full balance on your credit card.

However, for most credit cards, that’s not true. Usually, your points are deposited into your account at the end of each billing cycle. You’ll snag those points to keep and use even if you haven’t paid your bill or you carry an outstanding balance.

Read more: Watching my best friend rack up over $10,000 in credit card debt made me put 5 checks and balances in place to avoid the same mistake

Even though you can redeem your points before paying your full balance, it’s important not to be reckless with your spending just to earn more rewards. Carrying a balance on your credit card can come with high interest, a reduced credit score, and the headache of having to pay the accumulated amount every single month.

Earning points isn’t worth it if you’re not a big traveler

As I’m looking into new credit cards, I’m wondering if getting a card that’s centered around earning points that can be converted to use for travel rewards is worth it if I’m not planning on traveling much in 2022.

What I’ve noticed is that travel rewards points can still benefit a non-traveler in many ways. For starters, most of these credit card points won’t expire as long as the credit card is open and active. Plus, most credit cards offer additional redemption options if you don’t want to use points for a big vacation. For example, some programs allow you to redeem your points for statement credits, gift cards, purchases at retailers like Amazon, and more.

Read more: 7 things you can do with your points and miles besides booking travel, from making Amazon purchases to ordering food delivery

If you’re looking to get a new credit card that offers travel points and you’re not planning on traveling, check to see how else those rewards can benefit you.

Having multiple credit cards with different reward programs can ruin my credit score

If you’re someone who wants to have a handful of credit cards so you can get benefits from all different kinds of reward programs (one from a hotel, another from a retail store, and one for an airline), you might be worried that “reward point chasing” can impact your credit score.

Read more: 6 ways to optimize your credit card rewards without hurting your credit scores

Applying for new credit cards won’t necessarily impact your credit score in the long run, although your score may dip slightly when you open a new card. However, opening up cards, spending money, and not paying your bills on time will hurt your credit score.

There are several factors that impact your credit score, from payment history and account balances to the length of your credit history. Keep that in mind before you apply and make sure you have a strategy before opening up multiple cards just for the rewards.

Credit card points are easy to redeem at any time

The truth is, earning reward points is easy. As you spend money on your credit card, the points start to accumulate. However, redeeming those points can be a headache.

Some reward programs have limited travel availability on certain calendar days (usually around holidays or busy weekends), and some hotel loyalty programs have blackout dates or only release a capped amount of hotel rooms that can be redeemed using points.

Read more: There are different types of credit card rewards — but this is the best one

If you want to make sure you can redeem your rewards at any time, no matter what, look into a credit card that earns flexible points, like the Chase Sapphire Preferred® Card or Capital One Venture Rewards Credit Card.

Credit card points never expire

One big myth I thought was true was that credit card points never ever expire.

While rewards earned on travel or


cash back credit cards

issued by a bank usually won’t expire while your account remains open, there are exceptions. For example, with the US Bank Cash+® Visa Signature® Card

rewards will expire at the end of the calendar month 36 months after the billing cycle in which they were earned.

Read more: How to keep credit card rewards from expiring

It’s also important to note that your credit card points could expire if your account isn’t active and they can be lost completely if you close a credit card.

Make it a priority to look into the reward rules that come with your card so you’re aware of any potential way that your points could expire or be lost.

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