How can you compare credit card rewards and fees?

1 Know your goals

Before you start comparing credit cards, you need to know what you want to achieve with them. Do you want to earn cash back, travel miles, points, or other perks? Do you want to pay off debt, build credit, or save money on interest? Do you want a simple or a complex rewards program? Your goals will determine what kind of rewards and fees you should look for in a credit card.

2 Compare rewards rates

One of the most important factors to compare credit cards is the rewards rate, which is the percentage of your spending that you get back in rewards. For example, if a card offers 2% cash back on all purchases, the rewards rate is 2%. To compare rewards rates, you need to consider how much you spend in different categories, such as groceries, gas, dining, travel, etc. Some cards offer higher rewards rates for certain categories, while others offer a flat rate for everything. You also need to check if there are any caps, tiers, or minimums that affect the rewards rate.

3 Compare fees and interest

Another factor to compare credit cards is the fees and interest that they charge. Fees can include annual fees, foreign transaction fees, balance transfer fees, cash advance fees, late fees, etc. Interest is the cost of borrowing money from the card issuer, which is expressed as an annual percentage rate (APR). To compare fees and interest, you need to consider how often and how much you use your credit card, and how quickly you pay off your balance. Some cards offer low or no fees, while others offer low or zero interest for a limited time.

4 Compare redemption options

A third factor to compare credit cards is the redemption options, which are the ways that you can use your rewards. Redemption options can include cash back, statement credits, gift cards, merchandise, travel bookings, transfer partners, etc. To compare redemption options, you need to consider how flexible and valuable they are for you. Some cards offer more redemption options than others, while some offer better value for certain options.

5 Compare benefits and features

A fourth factor to compare credit cards is the benefits and features that they offer. Benefits and features can include insurance coverage, purchase protection, extended warranty, fraud protection, free credit scores, concierge service, etc. To compare benefits and features, you need to consider how useful and relevant they are for you. Some cards offer more benefits and features than others, while some offer exclusive or premium ones.

6 Use online tools and resources

A final tip to compare credit cards is to use online tools and resources that can help you find and compare the best offers for you. Online tools and resources can include credit card comparison websites, calculators, reviews, blogs, forums, etc. They can help you compare credit card rewards and fees based on your personal preferences, spending patterns, credit score, and goals. They can also help you learn more about credit card terms, tips, and best practices.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?