Thrifty Thinking: Rewards Cards Survey

MyBankTracker.com, a financial comparison site, conducted an ongoing survey about credit cards throughout 2018. More than 2,000 people were surveyed. The results revealed that consumers may be looking to get back to basics. Here are the top findings:
 

• 1 in 10 (10.57%) respondents don’t know their credit score
• When it comes to credit card rewards, cash back is preferred (68.90%)

• Travel rewards were a distant second at 17.15%

• Nearly 1 in 5 (18.50%) respondents always carry a credit card balance
• Among those looking for a new credit card, the majority had a specific spending category in mind (54.02%) compared to those who sought a general-purpose credit card (45.98%)

I had a chance to interview Simon Zhen, research analyst for MyBankTracker.com, to learn more.

Why do people prefer cash back over other rewards? 

Cash back rewards are simple and straightforward. Consumers know the clear value that they're getting from a cash back credit card. Other types of rewards that use points or miles can be more complex when it comes to redemption. 

For example, a travel rewards credit card may offer points that can be redeemed for gift cards, merchandise, or travel accommodations. Furthermore, these points may also be transferred to partnered airline frequent flyer program. These points can be valued very differently depending on what the consumer wants to redeem these points. To maximize the value of these points, it can take time and effort that many people don't want to give up.

Why is it important for people to know their credit score even if they aren't planning on applying for loans? 

 It's important for people to keep track of their credit scores, even if they don't need a loan, because good credit may be need for other purposes, such as employer background checks, utilities, and rental applications.

What contributes to spending categories versus general purpose credit cards? 

 The survey considered "spending categories" to be:

- Dining

- Entertainment

- Gas

- Groceries

- Shopping

- Travel

The survey considered "general purpose" based on the "Everything" response.

MyBankTracker conducted an ongoing survey regarding credit card preferences during the calendar year of 2018 with 2,032 respondents of ages 18 and up in the United States with a margin of error of +/- 1.96. https://www.mybanktracker.com/open-data/surveys/2018-study-credit-cards-302171