Don’t Charge Away Your Benefits

Reward programs that allow consumers to invest while they spend have limitations

in these reward programs to continue to show discipline in their spending habits.

Brian Anderson, CEO of BondRewards, which allows account holders to earn free U.S. savings bonds for purchases made with 150 partners, defends these investment reward programs as “a very simple, painless way to go about building an equitable savings strategy that can augment or enhance [consumer] savings by doing what they do every day.”

And that is true for those who use the programs wisely. Shine admits that when she received the Upromise card, she was more focused on accumulating points than managing her debt. In an effort to be more disciplined, she has now cancelled the card and is aggressively paying off her remaining balance. “I think other investment options I have set up for my goddaughters are better vehicles for college savings,” she says.

Finally, with so many reward program cards available, it is essential that consumers evaluate their goals, spending habits, and, most importantly, the card’s interest rate before moving forward. “If you carry a balance, look at the reward and the interest rate and weigh it out. If one card offers a 13% APR and another offers a 15% APR and you carry a $5,000 balance, you are paying an extra $100 a year for the card with the higher interest rate,” McKinley says. “Ask yourself, is the reward worth it? Make sure you are not overpaying on one feature of the card to get another feature.”

So before you are swayed by the promise of saving for a college education or some other investment goal by spending on your credit card, remember that those who reap the highest benefit are those who pay on time and don’t overspend.

Reward Cards With Investment Features
The majority of coalition programs are geared toward education savings, but jus
t about every investment vehicle is available. Here’s a snapshot of their offerings:

  • Citi Upromise Platinum Select MasterCard: No annual fee; variable APR of 11.49%; earn 1% on all purchases, up to $300 annually. Earn up to 10% on grocery and drugstore purchases and gasoline.
  • Fidelity Investments 529 College Rewards Card: No annual fee; variable APR of 13.99%; earn 2% on eligible purchases, sent directly to Fidelity-managed 529 savings plan, with a maximum $1,500 contribution per year.
  • BabyMint MBNA Platinum Plus MasterCard: No annual fee; APR of 9.9%; earn 1% on all purchases and up to an additional 30% through participating merchants. Earn matching tuition dollars from nearly 150 private colleges.
  • Futuretrust MasterCard: No annual fee; 0% introductory APR on purchases for the first six months; earn 1% on all purchases and up to 10% through more than 200 partners.
  • EdExpress: Earn rebates of up to 35% with 400 online retailers for an annual membership fee of $24.95.


  • NestEggz Loyalty Rewards MBNA MasterCard: No annual fee; 9.9% APR; earn a 1% rebate on all purchases, 3% on gas, and up to 30% through retail
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