Applying for a new credit card? Now is a great time to take advantages of many of the excellent rewards offered to new cardholders. There are a lot of options out there to consider so make sure you do some homework and pick a card that truly works for you.

One of the best options for many cardholders is a rewards card that can help offset spending costs by providing cash back on certain purchases or by letting you collect and cash in points for things like travel costs, merchandise, gift cards and more. Read on for tips to help you get the most rewarding card this season.

What is a rewards card?  

These credit cards reward you for purchases made when you use the card. The more you spend, the more rewards you can earn. Rewards may be based on a percentage of your overall spending or on purchases made at specific types of stores (gas, grocery, etc.). There is some strategy involved to maximizing your reward. You don’t want to overspend and blow your budget just to get some cash back.  

A rewards card may be right for you if: 

• You have good or excellent credit 

• You don’t generally carry a balance from month to month

• You travel regularly and can use airline or hotel points 

• You tend to spend the most in specific categories – such as groceries, gas or dining out 

Don’t change your spending habits to chase rewards. Instead, find a card that rewards you the most for how you typically use your credit card.

  
    

Types of rewards cards There are many types of rewards credit cards to consider, but most of these cards fall into one of the following four categories:    Flat-rate cash-back credit cards: A flat-rate cash-back card gives you a small percentage (usually 1% – 2%) back on everything you charge to your credit card. If you tend to put a lot on your card in a bunch of different categories, this may be the best option for you.    Flexible cash-back credit cards: These cards you more for purchases made in specific categories. For example, Valley’s Cash Rewards American Express® Card gives you a bigger percentage for purchases made at gas stations and supermarkets, while still providing cash back for other general purchases.    Flat-rate redeemable points credit cards: These cards reward customers with points instead of cash back. Cardholders will accrue points on every dollar spent. These points can then be redeemed for a wide range of rewards. Valley’s Visa® Real Rewards Card, for example, gives you 1.5 points for every dollar spent on eligible purchases, there’s no limit to how many points you can earn, and you have 5 years to redeem your points towards a wide range of rewards. Additionally, these types of cards often include introductory bonus points after your first purchase.    Flexible redeemable points credit cards: If you want to get more bang for your buck for certain purchases, a flexible redeemable points card may be your best bet. These cards will focus their rewards on specific categories, giving you the opportunity to maximize points if you use your card strategically. Shoppers who want to enjoy the greatest travel and lifestyle benefits may want to consider a card like Valley’s Premier Rewards American Express® Card, which lets users earn 4 points for every dollar spent at restaurants, 3 points for every dollar spent on airline purchases, 2 points per dollar on gas and 1 point per dollar on everything else. For people who dine out or travel a lot, this type of card can really pay off.

 

Other factors to consider when getting a new credit card  

While shopping for the best rewards card, don’t forget to take into account additional factors that can impact your choice.

  

• Annual fees: Annual fees can quickly offset your cash back or rewards points. Choose a card with low or no annual fees to maximize your benefits.

• Foreign transaction fees and card acceptance: If you do a lot of traveling overseas, make sure your card is widely accepted globally and won’t saddle you with high transaction fees.

• Your credit score: Your credit score will impact your eligibility for certain cards, so work to build this up as much as possible to get the lowest APR and best rewards out available. Here are some tips to help you manage your credit score.

  

Rewards cards can help you earn benefits just by doing your regular, day-to-day shopping. As long as you pay off your balance each month so your interest payments don’t outweigh the rewards you are earning, these cards can offer you big savings on the things you buy the most.