I never thought I would be writing an article about credit cards.
I am generally not a fan of credit cards, even for the most disciplined savers out there.
There are numerous studies that come to the conclusion that people who have credit cards tend to spend more than those without credit cards. That is the human condition. When making an electronic transaction compared to paying with cash, it is the paying with cash that is going to hurt a lot more. Thereby making using the card easier and more frictionless. Less friction means less roadblocks in place and a higher likelihood of spending more.
On top of this, reward cards offer rewards. It’s in the name. And when we receive a reward such as cash or air points, we receive a dopamine hit and it feels good. Maybe even leading to spending even more than we would have otherwise.
These factors if you are not disciplined or on top of your behaviours, can mean any rewards from credit cards are not worth it.
However, some people can use credit cards responsibly, and there is a need for choosing the right credit card for your situation. It can be a difficult decision with so many options out there. Some offering air points, some hot points, others cash, and others true rewards.
I have tried to simplify the complexity, by making two new website calculators that you can find here.
The first one is a grid that shows the top five credit cards based on rewards for someone who spends between $10,000 and $60,000 a year in increments of $10,000. Much less than $10,000 and the costs of most of the cards are not worth it. At that level you would want a no cost or very low fee card.
Since some people are not interested in points of any sort, and only want cashback, I have also provided a couple of grids showing the top five credit cards in terms of cashback rewards only.
The second credit card comparison calculator is one where you can enter in how much you are spending per year on any given card, and you will receive personalised results based on your exact spending amount.
For example, maybe you want one card for the airpoints and another one for the cashback. You can find the preferred option in both instances.
Just note, that there is more to making the decision on credit cards than just the spend rewards. For example, some cards offer longer payback periods, others offer insurances, and others limit where you can spend your rewards. You should consider all factors before making a decision.
The information contained on this site is the opinion of the individual author(s) based on their personal opinions, observation, research, and years of experience. The information offered by this website is general education only and is not meant to be taken as individualised financial advice, legal advice, tax advice, or any other kind of advice. You can read more of my disclaimer here