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The Choose Wisely guide to applying for a reward card

The Choose Wisely guide to applying for a reward card
Written by Mark Grimley
Published on 6th July 2017
Updated on 23rd August 2018
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There are reward cards available that will earn you points, air miles, cashback and other bonuses. You could get rewards valued at hundreds of pounds a year just by shopping normally and earning while you spend. On the other hand, you need to be organised and stay on top of your credit card balance and payments in order to get the best value from yourreward card. With all these options, which reward card is the best choice for you? And how do you go about applying for them? All the answers are here in Choose Wisely’s guide to applying for a reward card. What’s more, there is further information about different credit cards available on the Choose Wisely site.

You need a good credit score

Reward cards are generally only available to those with a good credit history, over 21 and in full-time employment, but the criteria will differ depending on the lender. You can check your credit score yourself in advance. This will help you see which credit cards you should be applying for so that you can aim for cards that accept people with your credit rating and financial circumstances. Sometimes credit cardcompanies offer a soft approval check on their websites. You can use this to see if you are likely to be accepted without leaving a mark on your credit file.

Do your calculations

These cards compete on the rewards they give you, not on their interest rates. The interest rates tend to be on the higher side, so unless you can pay off your balance in full every month, you will probably be paying more in interest and fees than you get back from the rewards. Reward cards work best when you switch existing monthly spending from your current account or othercredit cards to your new rewards card. Creating extra spending just for the rewards is unlikely to result in the most efficient savings, nor is carrying a balance on the card or getting hit with late fees and charges on monthly payments.

Check the limits on the card

The rewards sometimes have limits. For example, you may only get rewards on the first £10,000 you spend per year. Reward cards don’t work well for balance transfers as you will pay interest on the balance that will probably outweigh anything you get back in rewards. So, the upper credit limit might not matter too much to you if you plan on paying the card balance off every month.

Choose your rewards

Think practically about where you spend the most money and where the rewards would be most useful. If you are a regular user of a certain supermarket, and part of their loyalty programme, you might want to boost your points with your credit card spending. If you don’t have any particular allegiance to a certain shop then a cashback credit card might be best, alternatively, you might want to focus on earning air miles. Choose Wisely has information on both to help you make the right choice for you.

Compare reward credit cards carefully

On Choose Wisely you can compare different reward cards. You want to check any limits they have on reward earnings, the fees and the interest rate should you ever build up a balance that is not paid off each month.

Applying for your reward card

Applying is quick and easy online and often completed within minutes. You will want to be prepared for filling in the information you need, including your personal details including previous addresses and bank accounts. If you are applying for a card tied into a loyalty programme you are already part of, such as air miles or a supermarket points scheme, you might want to have that information ready. Some schemes offer you bonuses just for applying, and you don’t want to miss out.

Mark Grimley
Written by
Mark Grimley
Head of Partnerships & Take Control Author at Choose Wisely

Mark joined Choose Wisely in 2015. He continues to work in close contact with the providers, brokers and journalists operating in the world of consumer credit.