This One Mistake Cost Me $50 in Credit Card Rewards

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  • Some rewards credit cards have categories that change every month or quarter.
  • Rotating category cards typically require you to activate your bonus category to earn the bonus rewards rate.
  • You can set phone reminders or sign up for reminder emails from the issuer.

Forgetting can be expensive.

I'm one of those people who relies on lists and spreadsheets to keep track of things. If it's not on the list -- well, sometimes it gets overlooked. (All right, it frequently gets overlooked.)

Luckily, this isn't usually that big of a problem. I may have to hit the grocery store a second time or wear my second-favorite shirt while the laundry runs a day late.

But, other times, that oversight is a much bigger deal -- especially when it costs me money. Like the time I forgot to activate my cash back rewards card's quarterly bonus category. That was a $50 mistake I still regret.

The different types of cash back cards

There are a few types of rewards credit cards out there. The simplest are those that offer the same flat-rate rewards all the time -- for example, a cash back rewards card that always offers 1.5% cash back on purchases. 

Then there are rewards cards with bonus categories. Often, those categories stay the same year-round, like a gas rewards card that gives you 3% back on gas all year.

Finally, some bonus category rewards cards have rotating categories that are either chosen by the issuer or picked by the cardholder. These cards can have a different bonus category every quarter or even every month.

Cards with rotating categories can be very valuable since they often have some of the highest rewards rates for their bonus purchases. For instance, my favorite rotating category card -- and the one at the heart of this story -- offers 5% back in the designated bonus category on up to $1,500 in purchases every quarter.

Rotating categories usually need to be activated

The downside to rotating category cards is that you typically need to activate your bonus category each quarter to receive the bonus rate. It's a simple enough thing to do; you just log into your online account or go into the mobile app and click the "Activate" button.

Now, it's only simple if you actually remember to do it. Which, as it turned out for me recently, I did not.

To add insult to injury, it was a bonus category I was excited about, as I had some major purchases planned to fit perfectly. A whopping $1,250 worth of major purchases, in fact. 

Had I remembered to activate my bonus category, I'd be looking at a nice return of $62.50 in cash back. Because I didn't hit that one little button, however, I only earned the default 1% cash back on my purchases -- a sad little $12.50, $50 less than I could have received.

Never underestimate the power of a good reminder

As soon as I realized my mistake, I set about making sure it wouldn't happen again. For me, this meant setting up a recurring reminder on my phone calendar. Now I get a helpful notification on my phone two weeks before the start of each quarter reminding me to activate my bonus categories for the upcoming months.

Most issuers also offer a second option: reminder emails. You can sign up to receive notification emails from the issuer before each quarter with a reminder to update your categories.

No matter what method you use, if you have a credit card with rotating or choose-your-own bonus categories, it's important to remember to activate or choose your categories every quarter (or month, as the case may be). It's a simple process that usually takes less than a minute -- and that minute could help you earn five times the rewards.

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