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Are Credit Card Rewards Worth It?

credit card rewards worth itCredit card companies have gained many customers with their credit card rewards offers. From travel points to cash back, there always seems to be credit card rewards for someone to take advantage of. But are credit card rewards really worth it? Do they matter, or is it all just a gimmick? That all depends on you and your lifestyle, but I’m going to go with a big fat, “Eh”.

Related: Top Featured Credit Cards – $200 Offer

Are Credit Card Rewards Worth It?

This post has been written by our staff writer, Kimberly Studdard.

“What?? No to credit card rewards? But it’s like free money! Why wouldn’t you want to get paid on your purchases?!” …says nearly everyone I’ve ever met. I get it. Credit card rewards seem like a no-brainer, but there are definitely some downsides that you should be aware of.

1) Interest & Fees Can Be High

First things first, let’s talk about the fees and interest rates! Unless you have a perfect credit score and maybe even a magic wand, chances are that if you sign up for a credit card, you’ll get a high APR rate. While this is normal for credit card companies, it’s not normal to spend money to “make money back” or earn credit card rewards if the interest is just going to eat away at them. It doesn’t make any financial sense to pay $200+ for just a measly $10 back.

Also, some credit cards have yearly fees or other fees that come with holding the card. And unless you spend enough money on your credit card to eat up those fees and get enough rewards in return, most likely the rewards you get won’t balance anything out.

Are credit card rewards worth it? Not in you’re paying interest and fees!

How to get around this: If, at the end of the article, you’re still dead-set on a rewards card, commit to never having a balance (so then at least you don’t pay interest). Also, try to find a rewards card that doesn’t come with any extra fees, or at the very least, minimal fees.

2) You Might Forget About the Rewards

Have you ever gotten a gift card for Christmas, thrown it in your wallet, and forgot about it for a few months until you run across it again? No need to be ashamed if you have because a lot of Americans do. Just like many Americans forget to even use the rewards that they receive by using their credit cards.

In 2016, only 15% of Americans that had credit card rewards used them to pay for part or all of their vacation. That means that 85% of cardholders either forgot about their rewards or couldn’t use them.

If you have never used your points and don’t even know how to access them, then the question of, ‘are credit card rewards worth it?’ is a very real one. After all, why go through all the hassle and extra fees and interest payments if you never get anything out of the deal anyway?!

How to get around this: Make a note to check in on your rewards every quarter or so. Set a date on your calendar. You can even set this around your budget planning!

This also brings me to my next point.

3) Credit Card Rewards May Come With Severe Restrictions

Some travel credit cards have reward options that you can only use during certain times of the year.

Some cash-back offers rotate their offerings, so you may get 5% back on gas one quarter of the year, but then only 1% on gas the next. If you look at your credit card rewards, most likely, you’ll see some type of restriction. However, some rewards have severe restrictions that usually make them useless and pointless. Why spend $5,000 on a travel credit card just to realize you can’t even use the points for an airplane seat or hotel that you’ve had your eye on?

Are reward credit cards worth it? Certainly not all of them! And it’s because of all the freeking restrictions!

How to get around this: Make sure to do your research on the credit card you want to use. While some credit card companies are shady and don’t really reward you for using them, some do have decent programs. For example, these are some great travel reward cards that don’t put up a lot of restrictions for those that love to travel!

4) The Thought of Rewards May Cause You to Overspend

Here’s the biggest kicker of them all. The thought of earning credit card rewards can cause you to overspend on that credit card, thus getting hit with high-interest rates and of course, spending money you don’t really have.

Now, the common sense thing to do would be not spending money on a credit card that you know you can’t afford. But sadly, the average American has nearly $6,500 in credit card debt.

While there is nothing wrong with taking advantage of credit card perks, the whole point in rewards is to be able to save money. And you can’t save money if you’re constantly paying it back. Now, if you don’t have an issue with overspending, that’s great! Grab that rewards card you’ve had your eye on. But if you are a spender, or if you’ve had major issues with consumer debt in the past, be a little leery of signing up for a new card.

Are credit card rewards worth it? Not if you’re more inclined to buy things just for the points, and many of us do that!! (C’mon people, let’s be real here…)

How to get around this: Have a set budget, and don’t overspend on your credit card. Don’t feel like you need to take advantage of every credit card offer you see, and only spend on the card if it makes sense and if you know you can pay it off in full.

Related: The (FOR REAL) Best Credit Cards for Excellent Credit

Are Credit Card Rewards Worth It?

Hmmm….sounds like a toss up..

Overall, credit card rewards aren’t a bad thing, and they can certainly help if you know what you’re doing. But if you’re just the average person not looking to travel a lot or take advantage of spending a lot of money on a credit card, credit card rewards may not be worth it for you.

So what’s the final vote? Are credit card rewards worth it?

If you…

  • have a rewards card and use it to buy things you were going to purchase anyway (gas, food, home repair items, etc.),
  • if there are no fees,
  • if you pay your bills on time and avoid interest,
  • and if you’re not buying extra things just because you’ll get more rewards…

…THEN it’s okay to have a rewards credit card and might actually be an advantage for you.

Don’t get caught up in the hype of being paid money back. If more money is going out than coming in, then the credit card companies are winning, not you. And, based on the growth of credit card companies these days, I’d wager a guess and say that they’re winning the majority of the time… 😉

How about you? Do you think credit card rewards are worth it? Do you have one?

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AUTHOR Kimberly Studdard

Kim Studdard is a project manager for online entrepreneurs and small businesses. When she isn't spending time with her daughter and husband, or reading her growing pile of horror books, you'll find her working on her HR degree and working towards FIRE.


  1. Guilty with #4 – my current card rewards are tripled for food purchases, which is actually a 1% rebate. I justify my overspending on food with the thought of rewards. Terrible practice.

    • Those banks and credit card companies are no fools! We have to make sure we’re not falling into their traps!

  2. Credit cards are like red wine, the benefits outweigh the dangers when used in moderation. But too much of either will ruin your life.

    • Yeah…I’ll buy that. Thanks for the comment, Greg!

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