Making the most of your credit card rewards: 4 strategies to try

If you can wrap your head around the confusing world of credit card rewards, you can score major benefits.

Credit card floating alongside luminous shapes
Make sure you have a card with a rewards program that suits your spending habits.
(Image credit: akinbostanci / Getty Images)

If you really want to squeeze the most out of credit card rewards, it requires a bit more strategy and effort than clicking redeem whenever points or cash back appear in your account. And before you write off taking on any more work, realize that if you can wrap your head around the sometimes confusing world of credit card rewards and learn how to maximize what's being offered, you can score everything from an impressive sign-up bonus to points redeemable for travel, hotels, or shopping to perks like airport lounge access and discounts on Global Entry or TSA PreCheck application fees.

But before you dive straight into the tips, there are some things to note. For one, it's vital that you can afford to pay back the spending you do with your credit card in an effort to rack up rewards — otherwise, steep credit card interest rates will end up canceling out any of the extras you earn. Next, remember to "weigh the rewards against the annual cost of a card, which can range from zero to $695, and which airlines, hotels and other travel partners it works with," advised The New York Times.

1. Make sure you're using the right card

First thing's first: Make sure you have a card with a rewards program that suits your spending habits. As Bankrate explained, "different credit cards reward different types of spending, so you should clearly understand what you spend your money on to maximize your earnings." 

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If you're a frequent traveler, for instance, you might opt for a card that rewards spending in that category, whereas someone who primarily spends on dining out might look for a card that offers generous rewards at restaurants. If you're spending isn't consistently concentrated in a single area, then a "flat-rate cash back credit card could be a good fit for you," according to Bankrate.

2. Get choosy about how you redeem rewards

Often, credit cards will offer multiple ways to redeem your rewards, and it's important to know that not all redemption options — which can range from gift cards to merchandise to airfare to a statement credit — will necessarily offer equal value. For instance, American Express cardholders "get 1 cent per point when they’re using their Membership Rewards balance to purchase an airline ticket or a hotel room on the Amex website," whereas those points are only worth "about 0.7 cents if used to make a purchase on Amazon and 0.6 cents if used to pay for eligible purchases on your monthly statement," the Times reported.

3. Spend to the strengths of different cards

Especially if you already have multiple cards, getting strategic with how you use each of them can help you make the most of your available benefits. For instance, if you have a credit card that offers great rewards on travel, but dismal benefits on groceries and gas, you might exclusively use that card for booking upcoming trips. Meanwhile, another card might offer generous rewards on gas, so you'll save that card for trips to the gas station.

Wondering how to keep track of which card to use when? Consider putting little stickers on each of your cards "indicating restaurants, gas, groceries or other categories," suggested the Times based on a tip from Gary Leff, of the travel site View From the Wing.

4. Familiarize yourself with your card's full potential

If you glazed over the fine print when you received your card, you may have overlooked some of the benefits it can offer. For instance, your card might offer rotating bonus categories (or even allow you to choose a category), where you can receive extra rewards for your spending, but sometimes you'll need to know to activate them. Or, your card might offer a shopping portal, where you can earn extra rewards — if you sign up. You might even find that if you have more than one card from the same issuer, you can combine rewards, which "lets you pool points and redeem them for a bigger reward," CNBC Select reported.

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