How to maximize your credit card rewards - Part 4

The card is likely to come with more perks the more it costs each year. Premium rewards cards with fees around $500 often come with statement credits toward eligible travel or shopping purchases each year, but you'll need to read the terms carefully to make sure you get the most out of these offers.

If you use your rewards credit card to its full potential, you will probably spend enough to cover the annual fee. Even though it's understandable that many cardholders focus on how much they can earn with rewards credit cards, it's important to think about other perks and benefits when choosing a card. Most of the time, these benefits will save you money on things you were going to buy anyway.

Keep track of your money. Using a credit card for all of your purchases can help you get the most rewards. Still, if you carry a balance from month to month, you usually can't earn anything with a rewards credit card. This is because cards with a revolving balance build up interest, which you'll have to pay off on top of the purchases you've already made.

If you use a credit card to spend more than you have, you could end up with a mountain of debt that is hard to get out from under. Even though it's understandable that many people turn to credit cards when money is tight, we recommend paying off your whole balance every month if you can. If you don't keep a revolving balance on your credit card, you can take advantage of rewards and perks without paying extra interest.

So, if you can pay off your bill in full at the end of the month, you should use your credit card for every purchase. And if you want to be able to hold yourself accountable, make a budget and keep track of your transactions to make sure you're on the right track.
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