Watch out for those consumer friendly credit card rewards

Marketwatch promoted consumer-friendly credit cards, but forgot to add the warnings about many of these deals. Any supposed "consumer-friendly" credit card that requires you to pay interest every month in order to get a reward is a bad deal for the consumer.

Take for instance the number 2 card on Marketwatch's list - the Discover Motiva Card - that gives back a month of interest every time a customer makes payments on time for six consecutive months. I don't know what the interest rate is on that card and I really don't care. People shouldn't be paying outrageous credit card interest at any time and a card that encourages people to carry over balances so they can get an interest reward is bad news for everyone that uses it to get the reward.

I love credit card rewards that give me money back when I use the card, as long as those rewards are available even when I pay my bill in full every month. In fact, I do use credit cards to get those rewards, but I never carry a balance on my credit cards and always pay them in full each month.

My favorite reward card is from my insurance company's bank. Each time I use my card I get points toward paying my next insurance bill. I deliberately put all major purchases through that card even though I pay the purchase in full when I get the bill. I save hundreds on my insurance payments each year.

Credit card rewards are great if you're good at managing your spending and you don't use them to get rewards on paying interest. Don't open a new card every time you see a reward you like. Each time you open a credit card account it does hurt your credit score. Carefully review the rewards programs out there and pick one, or maybe two, that will give you the best rewards based on how you spend your money. But, always watch your spending to be sure you can pay your cards in full each month.

Lita Epstein has written more than 20 books including the "Complete Idiot's Guide to Improving Your Credit Score."

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