How to Choose a Rewards Credit Card
You will find many different rewards credit cards out there. They each promise amazing things, and yet some are better than others for giving you what you want. The following are tips for choosing such a card.
The basic gist is that you need to put a dollar amount of value on what you will receive back from them. You can then compare the rewards credit cards and go with the one that gives you the most. You can do this for a period of time like a month or calculate it over the year. For the cash back ones this will be the simplest. Just consider how much you spend and multiply that by the cash back. Some of them give you cash back in certain categories like gas purchases, which make it a little more complicated but you should be able to get an idea.
You then need to put a cash value on non-cash rewards you get. If you get airline miles then consider how much that would save you off of your plane trips. If you get prizes, then consider how much they are worth. Remember that a fifty dollar restaurant gift card isn’t necessarily worth as much to you as fifty dollars in cash would be. Consider any monthly or annual limits.
You should also consider that rewards can change. Some of the rewards credit cards have a specific starting and stopping date for their rewards. For instance, they may give you cash back for a certain amount of time. They may be the best deal for a certain amount of time, but then you could go to a different card. Some of them will have rotating rewards. For instance, they may offer an increased percent back on categories like drug stores or grocery stores during certain months. You will need to do the best you can to figure out how much these are worth. Also take into consideration any hassle it would be to keep track of these or whether you would feel like you couldn’t go to a place when the rewards weren’t as high, etc.
You want to consider other aspects of the rewards credit cards as well. For instance, if you are going to have a balance you might want to consider interest rates. You can consider how much credit limit they will give to you. Consider whether they are taken at the places you shop.
There are many different rewards credit cards from which to choose. Use the above tips to help you pick the one that is right for you.
Updated On: 09/08/2010 Published On: 09/08/2010 Article ViewerClose
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