Lesson 3 of 6
Choosing your first rewards card
How to evaluate a card on your own, without a stranger on the internet deciding for you.
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Save my infoStart with the welcome bonus, but read the requirement
Most of the value in year one comes from a welcome bonus: earn X points after spending Y in the first few months. The only question that matters is whether Y matches spending you would already do in that window. If it requires stretching, it is the wrong card or the wrong month.
Then the annual fee
A fee is fine if the recurring credits and benefits you will genuinely use exceed it. Be brutally honest about 'will use.' Credits you have to remember to use are usually credits you won't.
Then the earning categories
Pull up three months of statements and find your top two spending categories. Pick a card that earns extra in those. For most households it's groceries, gas, or dining — not the glamorous categories the marketing highlights.
Protect your credit
Applications cause a small temporary dip in your score. Space them out, and pause entirely for six to twelve months before applying for a mortgage or car loan. Keeping old accounts open helps your average account age.
Take this with you
- Match the minimum spend to spending you already have planned.
- An annual fee is only worth it for benefits you truly use.
- Choose earning categories from your real statements.
Sit with this
Look at last month's statement. What are your true top two categories?