Should You Get a Rewards Credit Card?

If you have at least good credit, pay off your balance each month, and are comfortable with the fees and terms, then yes, you should.
Kimberly PalmerMay 28, 2020

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Rewards credit cards come with enticing benefits: You can earn cash back, points or miles that help you stretch your budget or go on a dream vacation.

But rewards credit cards aren’t for everyone. They tend to carry higher APRs, which means if you carry a balance, you’ll be paying more. , too, so you have to make sure you’re getting more out of the cards than you’re paying. Here are questions to ask to help you decide whether you should get a rewards card, and what to look out for as you make the decision.


Most rewards cards require good to excellent credit in order to qualify for them, which typically means a of at least 690.

If you don’t have good to excellent credit, you can by paying your bills on time and keeping your credit utilization low. Then, when you can qualify for a rewards card, you can .

Not all rewards cards require excellent credit; the , for example, offers 1.5% cash back on all purchases and is available to applicants with only average credit, (FICO scores of at least 630).


If you pay off your balance each month, then there’s little downside to using a rewards card, even if comes with a higher APR. That’s because paying off the balance each month means you can avoid paying interest altogether. You get all of the upside of the rewards card without any downside.

Some rewards credit cards come with fees. The , for example, comes with a annual fee. Its sister card, the , comes with an even larger fee of .

Annual fees are not necessarily a bad thing; they tend to signal that the card also comes with major benefits. In the case of the , it comes with a huge sign-up bonus, generous ongoing rewards, and an annual travel credit, among many other benefits and perks. You just have to make sure you'll get more out of the card than you are paying in the annual fee.


When it comes to rewards programs, the devil’s in the details — or, in this case, the terms and conditions. They might come with restrictions that can put a damper on your ability to earn or redeem cash back, points or miles. Be on the lookout for:

If you know the answers to these questions and decide that you would benefit from a rewards card, the next step is , such as a travel or cash-back card. Soon you could be earning rewards that help you pay for your next vacation or big purchase.

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