Don't just go by an enticing rebate offer. Your spending habits should match the reward program.
"You have to calibrate how much you spend and where you spend it with cards that offer higher payouts in the categories where you're spending the most," says Greg McBride, CFA, senior financial analyst at Bankrate.com
Make sure to read the definitions and fine print to identify any catches or restrictions. For instance, the BankAmericard Cash Rewards from Bank of America and Flexperks Cash Rewards from U.S. Bank cards offer 3 percent cash back on certain purchases, but only for a limited time.
If the card offers a higher rate of return once your spending exceeds a certain threshold, figure out how long it would take you to reach it based on your monthly spending total. With Blue Cash from American Express, you don't earn the 5 percent cash back on "everyday purchases" until your spending climbs above $6,500. You'd have to charge more than $1,000 per month to reach that threshold in six months.
Then check out the ease of the redemption process. According to Shahani, many cash-back cards offer "automatic redemption" where the issuer would send or credit the rebate with no action required from the consumer. However, some credit cards require you to request the rebate -- leaving rewards unredeemed until you remember to contact the issuer.