How to Look for the Best Rewards Card

There are many rewards credit cards out there, offering a number of opportunities for you to earn free travel, merchandise, and cash back. How do you know which one is right for you?

Choosing a rewards credit card should be about what will benefit you the most in the long run. Before you sign up for a credit card, make sure that you double check the rewards, and consider the following factors:

What Will You Use?

The first consideration is what you are most likely to use. If you travel a lot, a credit card connected to your favorite airline’s frequent flyer program can really help you add up the miles and earn free flights faster. Some airline reward credit cards come with perks like free bag check and the ability to stay in the airline’s lounge. Others come with annual upgrades. Remember to include the perks in your calculations.

On the other hand, you might just be interested in getting cash back. If that’s the case, you will want to go with a straightforward program that repays you with a percentage of your purchases.

How Generous is the Program?

Even for those who travel often, some cards take tens of thousands of points to get one flight, making it difficult to earn enough points to make it worth your while. Additionally, not just any cash back card will do. Some have caps on how much you can earn each year, and others only offer 1% cash back.

Instead, look for programs that offer generous rewards. Consider those that offer bonus miles for certain purchases, or categories where you can earn 5% or 6% cash back. Consider cards that have rewards partners that provide you with rewards bonuses.

Some rewards credit cards also offer perks like exclusive discounts, and access to special entertainment and merchandise.

Is It Easy to Redeem the Rewards?

A 10,000-mile bonus seems like a big deal – until you try to redeem your rewards. Some rewards credit cards charge redemption fees. Others have black out dates that limit when you can use your rewards. Some airline and hotel rewards cards also limit your choices. You may only be able to decide between certain seats, or from a certain room rate.

These problems are usually not apparent when you use a cash back credit card, though. However, you do need to find out what the policy is for redemption. Do you have to ask for the cash, or does the credit card issuer automatically send you a check? Can you get a redemption bonus for choosing a gift card instead? Many cash back cards are starting to offer a 10% or 20% bonus when you choose a gift card from a partner. So, if you have $20 cash back, you can get a gift card for $22 or $24 with your bonus.

Not all rewards credit cards are created equal. Look through your options and decide which card is one that you are likely to maximize. You want something that you will use, and with generous rewards that are easy to redeem.