Get the most out of your reward credit cards

LOS ANGELES The banks want your business, so now more than ever, reward cards can pay off.

Bobby Johansen has flown many times for free, thanks to his /*Jetblue*/ American Express rewards card.

"If I make a lot of larger purchases, I generally do them on the Jetblue card so that I can redeem as many flight points as possible," Johansen said.

/*Consumer Reports*/ money adviser Chris Fichera has sized up the best rewards cards. But Fichera says be aware, they're only worth it if you pay off their balance in full each month.

"These cards generally have higher interest rates," Fichera said. "So if you carry a balance, you could end up paying more in interest than you get back in rewards."

Credit card users also need to watch out for hidden fees. Nineteen percent of rewards cardholders said they had increased fees for services like balance transfers, cash advances, and foreign transactions in the past year. Cardholders should scrutinize the fine print.

"Some cards have clauses that can make you lose out on points or cash back," Fichera said.

/*Discover Card*/ gives 1 percent cash back, but that drops down to 0.25 percent at warehouse or discount stores like /*Wal-Mart*/.

"The /*Chase*/ Freedom card can be good because it offers 5 percent cash back in certain seasonal categories," Fichera said. "But since those categories change every quarter, you have to opt in every time, which can be a hassle."

Consumer Reports' money adviser says one of the best cash back reward cards is the /*American Express*/ Blue Cash credit card. It doesn't charge an annual fee, and after spending $6,500 within a year, it offers five percent cash back at supermarkets, drugstores, and gas stations, and 1.25 percent elsewhere.

Retailers are offering rewards cards too, and if you're a loyal customer, they can pay off. Consumer Reports says a good one is the /**/ rewards /*Visa*/ card. It has no annual fee, pays $30 back on your first purchase, and points are unlimited and never expire.

Terms and conditions of rewards cards change frequently so users should routinely check for updated terms.

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