Calculating cash back credit card rewards
Advertising Disclosure
Credit-Land.com is an independent, advertising-supported web site. Credit-Land.com receives compensation from many credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. Credit-Land.com has not reviewed all available credit card offers in the marketplace.
Credit Card Applications » Research » Guides » Travel with Credit Cards » Calculating cash back credit card rewards

Calculating cash back credit card rewards


Updated: December 26, 2012

By
Add to Favorites:

One of the many benefits of using credit cards is the different rewards that can be availed through them. The rewards are associated with the purchase of items and they benefit both the customers as well as the credit card companies. On one hand the customers get to enjoy the different types of rewards and on the other the credit card company can remain assured that the use of their card will remain a steady source of interest earning for the company.

Need to calculate cash back credit card reward points

The reward points offered by different companies stand to be a major factor when customers choose a card for their use since various companies have different types of rewards for credit card users. It can either be in the form of cash back, airline free miles or discounts at gas stations or other eateries etc. Of all the reward types, cash back is the most popular among customers.

Many credit card companies do not declare openly the percentage of cash back that a customer is eligible for when he scores a certain amount of reward points. Before making a deal with a credit card company it is therefore pertinent that you understand the calculation parameters followed by the company when calculating the reward points. This would help the customer remain aware of his dues and also calculate his cash back amount.

Method of calculation

Follow a simple method to calculate to know your cash back reward points.

  1. The first step is to understand from the company representative the rate at which a customer earns points on every usage of credit card. More simply, understand the amount of reward points earned for every dollar used on the card.
  2. The credit statement will show you how many points have been earned by you. Calculate the money spent in earning the reward points by dividing the reward points with the rate prescribed. This will give you the amount of money spent in earning this reward point.
  3. This amount can be tallied when compared to the transaction statement issued by the credit card company.
  4. To get the percentage of cash back that is being rewarded for spending of a single dollar, divide the reward points with the results of step two. Move the decimal two places to the right to get the actual cash back percentage.

These calculations will help the customer to choose a card on the basis of the reward points offered. This knowledge will also help them stay aware of their dues and file for any discrepancy if found on the part of the credit card company.

Add to Favorites:
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.

Other Travel with Credit Cards Research:

Related Research:

How to Get Free Wi-Fi in the Air

By Herbert Moore, Posted: August 9, 2016

Sometimes in-flight Wi-Fi is the bare necessity when you travel abroad or within the country. However not all airlines offer free in-flight Wi-Fi. There is only a couple of airlines that will allow you to use Wi-Fi ... Continue reading

Amazon Credit Cards Review

By Allison Martin, Posted: May 30, 2016

When Amazon.com was launched 20 years ago, few could have envisioned how far the company would come. What was once an online specialty bookstore is now an Internet juggernaut that sells nearly anything and has made major inroads into ... Continue reading

How Much Do Shell Cards Really Save on Gas?

By Allison Martin, Posted: April 20, 2016

There is an endless amount of gas cards on the market, and practically every major gas station, including Shell, has options to choose from. In fact, Shell offers two options for gas cards for consumers. Continue reading