How Rewards Credit Cards Work

Rewards credit cards offer the cardholder the chance to earn special incentives or to accumulate points that can later be redeemed for rewards, perks, products, or services. You can find the best reward credit card programs for virtually any category that you can think of these days, including travel rewards, airline frequent flier or mileage awards, hotel rewards, rental car rewards, rewards for buying gas or groceries, and cashback rewards.

How Rewards Credit Cards Work

Credit card rewards and rebates typically range from 1% to 5%. Many credit cards with reward programs also give you higher rewards for shopping or making purchases in specific categories like travel, dining, or gasoline. As with most rewards credit card programs, those connected to your credit card may have terms and conditions that you need to be aware of before picking the best rewards credit card for you.

Things to Consider

Some credit card companies can place caps on how many points you can earn within a particular time frame. Others limit how long you can accumulate points before you need to cash them in for rewards – or they might nullify points if your card remains inactive for a long time. Therefore, it’s best to check the expiration dates and any limits like blackout dates for redeeming travel awards.

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Is this credit card right for you?

The best approach to choosing a rewards card is to try to find one that gives the best value based on your normal spending habits. Look for a card that rewards what you already do, as opposed to one that’ll make you increase your spending amounts or frequency in pursuit of points.


To help you find the rewards credit card that’s best for you and your particular spending habits and lifestyle, Compare Cards has cataloged a variety of rewards credit cards by reward redemption type. You’ll also find current reviews of the best – and worst – rewards credit cards, plus helpful side-by-side comparison tools that identify exactly what the pros and cons of each specific card are.

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