Applying for a rewards credit card is one of the smartest financial moves you can make. There are so many great options on the market, and whatever type of rewards you are looking to earn, you’ll be able to find something to suit you.

However, there are a few mistakes that people make again and again when they are choosing a rewards credit card. If you are on the hunt for a new card, read on and make sure you don’t make one of them.

Mistake #1: Not checking to see how much you have to spend to earn the signup bonus. Many cards offer a certain number of frequent flyer miles or reward points for new cardholders. These can be redeemed for free round-trip airfare, hundreds of dollars in gift cards, or free hotel stays. But in most cases, you don’t just get that bonus when you are approved for the card. You have to spend a certain amount of money in a certain amount of time: usually the first three months you have the card. It may be $300 or $3,000, but it you want the bonus, you’ve got to spend the money. Be sure you know what the amount is, and that you will be able to pay it off in full. If you don’t, then you may end up paying interest that makes the bonus not worth it.

The 3 Biggest Mistakes People Make When Choosing A Rewards Credit Card

Mistake #2: Not doing the math on the annual fee. The most high-value rewards credit cards tend to have annual fees. These fees can range from less than $40 to over $400, and many times, they are worth it. But before you apply for a card with a steep annual fee, do the math and make sure you will be earning and redeeming enough rewards each year to more than equal the annual fee. Otherwise, it’s not worth it, and you should look for a cash back or other rewards card with no annual fee.

Mistake #3: Not comparing cards. Don’t just go for the first card that pops up an advertisement on your Internet browser or sends you a flyer in the mail. Shop around and be sure you’re getting the best card for your particular needs. Do you spend a lot of time driving and need a gas rewards card? Are you a frequent air traveler and could use a co-branded airline card? There are too many great offers out there to miss out on the best card for you because you didn’t look around enough.

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