Rewards credit cards offer great incentives to spend, whether in the form of cash back, frequent flier miles and/or travel rewards, points that can be redeemed for specific products, or gas rebates. But are rewards credit cards really worth it? The answer is not a clear cut “yes” or “no.”

“If you’re disciplined enough to not carry a balance, rewards credit cards can be a real good deal,” says Scott Langdon, Vice President of Operations of Nationwide Card Services, a subsidiary of Bankrate, Inc. “I never pay cash anymore if I can avoid it, so the rewards really add up over the year. I essentially get paid to use my credit cards.”

While the benefits are apparent, there also are drawbacks. Rewards programs can be a temptation to spend more—and more, and more. It’s all too easy to justify an extra fifty dollar purchase because it will propel you closer to the points you need for that fancy new leather laptop case. If you wish to benefit from a rewards credit card, be careful to keep an eye on your spending habits and don’t get tempted by promises of rewards.

In addition to potentially encouraging overspending, rewards credit cards generally charge a higher APR than their “non-rewarding” cousins. Consequently, if you have a history of carrying a balance, a low APR card will prove more beneficial in the long run. The interest rates on a rewards credit card can quickly undermine the benefits if you don’t pay your balance off in full each month.

One of the main drawbacks of rewards credit cards may be that for many people, the rules are just too confusing.

“It’s too complicated to figure out what rewards cards are offering and how to make best use of it,” says Christine Albers, a Sales Manager at Books Are Fun, a Reader’s Digest subsidiary. “I’m just too busy to look into all the rules and conditions.”

Indeed. For some cards, rewards points expire after five years, for others, after only one or if the account remains inactive for a period of time. Some rewards credit cards cap the number of points you can earn in a year; others will cease adding points to your account should you send in a payment late. Some cards have a tiered rewards structure, others ceilings on rewards. Rewards payments can be slow and complicated to cash out. No wonder that many people never get around to redeeming the points on their rewards credit cards.

In short, to really benefit from rewards credit cards, you have to be organized and disciplined enough to never carry a balance. For most people, a simple cash back credit card may be the best choice. According to Consumer Reports, cash back credit cards are easier to cash in and actually tend to be more generous. Rewards credit cards can work in your favor, but the card companies designed them to also work in theirs. Do your research, be alert to your spending habits, and choose wisely.

What percentage rebate does the card award? While a 1% rebate is standard, some cards offer a 5% on your first $100 in combined gas and auto maintenance purchases each billing period, and up to 1% on all other purchases. If the benefits are equally attractive to you, go with the card that offers the best rebates on purchases you make frequently.

What is the maximum rebate I can earn per year? If you don’t put a lot of charges on your card in a year, you need not be concerned about this restriction. But if you charge a lot, you want to make sure that you don’t hit your earnings ceiling before the end of the year.

Do the earnings expire? For some of these cards, the rebates automatically expire if you don’t use your card for 12 consecutive months. Also, many require you to redeem your rebates within a certain number of years from the date they are earned. Read the Terms and Conditions carefully before you apply.

To shop and compare reward credit card offers that provide rebates on automobiles please visit our automobile rewards credit card section.

These are exactly the kinds of benefits that some car rebate credit cards offer. With a car rebate card, you earn cash back on all your purchases and you can redeem your accumulated earnings for numerous benefits.

The Discover® Open Road^SM Card lets you save on your car maintenance expenses, by giving you a full 5% cash back on them—and, you save money on your gas purchases too!

Rewards credit cards, cash back credit cards, airline credit cards, travel credit cards, auto credit cards, sports credit cards, and charity credit cards…. Every day, it seems, credit card issuers come up with new, creative incentives to differentiate themselves from the competition and attract more customers.

Although sifting through the many offers at times can feel like being lost in a maze, it is well worth your time to take a closer look at the rewards credit card issuers offer. With a little bit of planning, you can earn a 1 to 5% discount on most of your purchases. If you charge most of your expenses to your credit cards, over a year that can add up to real money—for most consumers as much as a tax rebate check from Uncle Sam!

If you find it difficult to choose, here are a few tips to help you. First of all, even though there are numerous types of credit card offers, they basically boil down into two types of cards: cash back credit cards and rewards credit cards.

Cash Back Credit Cards

Like the name indicates, cash back cards give you a percentage cash back on the charges you put on your card (balance transfers or cash advances are not included). Credit card issuers typically pay the rebate either by issuing a check or as a credit to your account.

What’s the advantage of cash back cards? You get money in your pocket to spend however you like. Plus it’s easy to see what percentage you are earning on your charges. A typical cash back is 1%, but many cards offer a higher cash back for certain types of purchases, or when your charges exceed a certain limit. Avoid time-limited offers with a high cash back rate that drops after only a couple of months.

Rewards Credit Cards

Like cash back cards, rewards cards let you earn a percentage rebate on your charges. Only in this case, you don’t get paid in cash, but in points which you can cash in for various types of rewards.

The advantage of rewards credit cards is that you get to choose among numerous attractive offers, including free airline tickets, free hotel stays, various types of merchandise and electronics, gift cards at your favorite stores, and even payments on your mortgage principal.

The disadvantage of rewards credit cards is that it can be harder to compare to see which rewards card gives you the highest percentage earnings, since you are awarded in points on your purchases. Still, if you have the time to look through the offers, there are many exciting rewards to be had in this category of credit cards.

If you want more information, our resource library contains numerous articles about choosing a cash back credit card or rewards credit card and how to maximize the rewards and cash back. To compare all our different types of cash back credit cards and rewards credit cards, you may also want to use our convenient Credit Card Comparison Guide.

Many rewards cards offer higher rebates or rewards on certain purchases, such as gas, and grocery and drug store purchases. Here, the type of reward and the percentage earnings vary considerably from card to card. Some cards, like the Discover® Open Road^SM Card, let you earn 5% cash back up to a certain limit on gas purchases and auto maintenance expenses. With others, you get awarded in points or miles, redeemable for airline tickets, merchandise, and other types of rewards.

When you look for a gas rebate card, there are a couple of things to keep in mind. Many cards come with attractive introductory offers, like bonus points or miles when you sign up, or double cash back earnings during the first months you hold the card. In most cases, however, you are best off getting the card that offers the best long-term value in terms of highest percentage rebate or highest mileage or points rewards.

Before you apply, also check to see how your earnings will be redeemed. In most cases, you have to request your rebate or cash in your miles or points, so it’s important to know up front how to do that. For some cards your points or miles will expire, sometimes in as little as six months, if you don’t convert them to rewards within a given period of time. In short, be sure to familiarize yourself with the Terms and Conditions of the card before you apply.

Lastly, as with all rewards or cash back credit cards, your savings can quickly be undermined by interest charges if you carry a balance. So be sure to pay off the charges to your gas rebate credit card in full every month. When you need to carry a balance, use a low interest credit card or a card with a 0% APR balance transfer offer.

See the list of tips on other ways to Save Money on Gas.