Reward cards

Credit card rewards can be worth it if you get enough value from them to outweigh an annual fee, interest charges or any other cost associated with maintaining your account. That extra value could come from a variety of sources, such as a welcome bonus, cash back earned on purchases or travel rewards points you then redeem to help cover the cost of airfare. In each case, the most important thing to remember is that rewards on their own aren’t worth much — you have to be able to use and redeem them to get value out of the card.

Neither cash back nor travel rewards points are always better than the other — it all depends on what best fits your habits and what you want out of a card. For instance, a travel rewards card with plenty of bonus categories and a high standard earning rate could offer more potential value than a cash back card that earns 1.5% back on all purchases, but the cash back card might still be better for you if you’re only likely to travel once every year or two. Similarly, someone who travels often and doesn’t mind searching for the best deals might want to go for a travel rewards card because they’re more likely to be able to stretch their points.

Ultimately, it comes down to how easily you’re able take advantage of your card’s rewards program when it comes to both earning and redeeming.

Your options for redeeming your credit card rewards will depend on your particular card and rewards program. In general, though, rewards cards will allow you to redeem for things like travel (like airfare and hotel stays), cash back, gift cards or merchandise. But how these redemptions are applied get even more specific. For example, travel redemptions may be applied as statement credits, or maybe you could use your points and miles directly for bookings. And the quality of a cash back card can even depend on how you’re able to receive that cash back, especially if there are limits on how often you can redeem or how many steps you have to take to get it.

If you’re not sure how you might want to redeem your rewards, try to choose a card that provides the best mix of flexibility and simplicity.

There’s a decent chance your credit card rewards have the potential to expire, although the exact rules depend on the card and the rewards program. Some rewards will expire on a specific timeline, like a certain number of months after they’re earned or after a long period of card inactivity. But others may only expire after your account falls out of good standing, like if you miss a payment or have your account closed. On the other hand, some rewards programs will actually allow you to keep and use your rewards for a set period of time after you close the credit card you used to earn them.

This means it’s probably a good idea to check your expiration rules even if a card is advertised as earning rewards that never expire. In some cases, the terms and conditions for these cards explain that you’ll lose your rewards if your account falls out of good standing.