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Credit card rewards can be somewhat controversial. Banks love to promote the smiling faces of their cardholders siting on some beach, while critics claim it is all a mirage. Certainly, those who spend more money or rack up debt in order to earn rewards will find that what they receive is never worth it (here are a few times they’re not going to pay off).

But at the same time, there are plenty of credit card rewards enthusiasts who find that these rewards are worth it. Here are five times that credit card rewards can (quite literally) pay off for cardholders.

1. When You Pay Your Statement Balance in Full & on Time 

About two-thirds of American credit card users regularly carry a balance on at least one of their cards. That’s costly, but it still leaves millions of others who avoid interest charges by paying their balances off every month. These cardholders are free to enjoy points, miles, and cash back, with very little (or no) cost to using a credit card, other than any annual fees.  In fact, those who never pay interest are simply leaving money on the table by not using a rewards credit card.

Charging too much to your credit cards can have a negative impact on your credit scores. Experts recommend you keep your credit utilization rate (your total balances to total credit limits) under 30%, and 10% is even better. You can see how your credit card usage is impacting your credit scores for free on Credit.com.

2. When You Treat Your Credit Cards Like Cash

The other key to earning credit card rewards that are worth it is to treat your card like cash. That is to say that you should never let the convenience of credit card use tempt you to spend more than you would have if you were using cash. Otherwise, unnecessary purchases will always cost more than the value of any rewards received.

3. When You Redeem Your Rewards Wisely

It’s easy to focus on the best ways to earn rewards, but the real secret is redeeming them the best way. For example, many rewards programs allow members to redeem points for a penny each, or less, toward merchandise or gift certificates. Yet the best values are usually found when redeeming points for airline miles that are used for last-minute travel or premium class international award flights. In this way, points can be worth 3 to 5 cents each, and sometimes more.

4. When You Earn Experiences You Couldn’t Afford

The best part about credit card rewards is that cardholders can use them for unique experiences that are otherwise out of their budget. Take frequent-flier miles for example. Many business-class flights cost three or four times the price of an economy ticket, but only 50% more miles. For most travelers, the only way they will ever be able to travel overseas in business class is by collecting miles with their credit cards. Likewise, luxury hotels in major cities can cost $500 to $1,000 a night, but free nights may be reasonably obtainable using points from a hotel’s credit card.

5. When Cash-Back Rewards Amount to a Discount on Purchases

Even those who have no interest in business-class flights and premium hotel stays can still realize tremendous value from their credit card rewards. Some cards offer as much as 2% cash back on every purchase, while others feature 5% cash back on select categories of purchases. So essentially, using these cards amount to a discount on every purchase. That can be really worthwhile if you organize your credit card spending wisely and put all of your grocery purchases on the card that’s offering 5% back on grocery charges, for example.

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