Finding a Good Rewards Card
In addition to helping you establish your credit history, credit cards can be a way to reap significant benefits from your everyday habits. These days, most credit cards offer some type of rewards program ranging from miles for an airline to gifts and even cash back.
Although most rewards cards come with an annual fee, most of us usually spend enough to make the small fee worth the price. Recently, I began looking for a new rewards card and was overwhelmed with the number of options. From airlines to cash back cards, most major credit card companies have several options–Capital One and Citi even offers cards affiliated with MTV!
Because all credit card companies have differing rewards structures and earning percentages, trying to compare similar cards can be quite a daunting task. So after doing some research, I’ve found some resources and tips to help you easily figure out if the credit card that will maximize your rewards.
1. Consider your spending habits
Because rewards cards usually have an annual fee attached to them, you should always make sure the rewards you receive are more than the amount you are paying to maintain the card. Also, certain credit cards can help you maximize your rewards if you spend a significant amount of money in areas such as entertainment or travel.
2. Find your credit score
Regardless of how responsible of a person you are, credit card companies often determine your interest rate and the type of card you qualify for based on your credit score. Knowing your credit score before you begin applying for a credit card will minimize surprises and potential disappointments once you know what your credit score does and does not qualify you for. Checking your credit report is also a good way to make sure your information is correct and there are no false claims against you.
3. Compare similar awards
Sites such as CreditCardTuneUp.com can make recommendations for cards based on how much and where you spend your money each month. Although CreditCardTuneUp.com only compares cards based on their awards, you should also consider the card company’s late payment-forgiveness policy, its fraud policy and also its interest rate.
4. Check the fine print every year
Rewards programs usually tweak the fine print every year and different types of rewards can be added or taken away without notice. To protect your earnings and rewards, it is always a good idea to understand the changing policy and keep track of your rewards so that they don’t expire.