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A reader is suspicious of all these "reward programs." How can they possibly be legit?

Question: Last month, I asked my girlfriend to marry me, and we started talking about our finances. She couldn’t believe I’ve never had a credit card in my life  — she has, like, nine of them. She says she’s earned all sorts of rewards.

Me? I’ve only ever used debit cards. I can’t help but think these reward programs must have some hidden fees. I mean, who gives away airline flights, gift cards, and even cash? Companies don’t stay in business not making money, right?

My fiancee says I’m paranoid and she’s earned plenty. I say she’s naive and is missing something. Who’s right, Howard? Please answer this question, because seriously, it’s our first-ever fight.

— Ethan in Missouri

Howard Dvorkin CPA answers…

Howard Dvorkin on how to get out of debt fastFirst, I’m pleased you two are discussing your finances before your wedding day. I can’t tell you how many married couples I’ve counseled who later got divorced because of money problems they never talked out beforehand.

Second, I’ll warn you against debit cards. As I’ve written before, a debit card combines the worst of both credit cards and cash.

Third, you’re not alone thinking those credit card reward programs are rigged.

In fact, right before the presidential elections last month, a company called Colloquy polled 1,500 U.S. consumers and found, “41 percent say that points, miles and cash back programs are rigged.”

Of course, that means 59 percent thought otherwise, but it probably won’t surprise anyone that, given the acrimonious presidential campaign, “Republicans are 60 percent more likely than Democrats to say programs are rigged.”

Ethan, I can tell you and your wife without doubt or hesitation: Reward programs from major credit card companies are definitely not rigged.

Then again, you make an excellent point: How can these companies stay in business if they’re doling out rewards? Simple, Ethan. Those credit card companies don’t have to rig anything to make much more than they’re giving away.

The reason: They know many Americans will run up huge balances on their cards, which means they’ll extract much more in high interest rates and other fees than they’ll pay out in points.

You didn’t provide details, Ethan, but if your fiancee has nine credit cards and even one is carrying a balance from month to month, she’s probably breaking even at best. At worst, she’s actually losing money.

However, if she’s paying off those balances every month, I recommend you elope today. That means she’s one savvy woman!


Have a debt question?

Email your question to and Howard Dvorkin will review it. Dvorkin is a CPA, chairman of, and author of two personal finance books, Credit Hell: How to Dig Yourself Out of Debt and Power Up: Taking Charge of Your Financial Destiny.

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Meet the Author

Howard Dvorkin, CPA

Howard Dvorkin, CPA

CPA and Chairman

Dvorkin is the author of Credit Hell and Power Up and Chairman of

credit card debt, credit cards, fees, save money, scams

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