iQuanti: According to the Bureau of Labor Statistics, the average U.S. household spends about $3,000 per year dining out — so why not get more value out of your restaurant dollar?
While going to restaurants and trying out new dishes can be fun, what's better is getting paid to do it. Many credit card issuers offer rewards that are specifically tailored for people who dine out frequently.
If that sounds like you, then here's what you can do to find the best credit card for eating out.
What Are Your Restaurant Eating Habits?
The first thing to consider is how often you'd actually use a restaurant rewards credit card. This would be based on the dining patterns of you and your family.
For instance, do you prefer:
- More expensive sit-down restaurants?
- Casual dine-in restaurants that are more budget-friendly?
- Take-out?
- Fast food?
- Food delivery service?
Also, how many people are you feeding at a time? For example, a family of five may spend more than a couple with no kids. A different dining credit card might be the right choice for each of these cases.
What's Your Credit Score?
Your FICO Score is one of the main factors in getting a new credit card. Most issuers who give rewards points for dining out will prefer that you have anywhere from a Good to Excellent credit rating. This means a FICO Score of at least 670 or higher.
A good way to find out your FICO Score for free is to visit Experian (one of the major credit reporting bureaus). Another way is to check the online dashboard of your other credit cards — many of the major issuers now share your FICO Score as a courtesy.
Is There an Annual Fee?
Some rewards credit cards offer more points per dollar spent than others. However, these card issuers often require an annual fee. Many times there will be a promotion where the annual fee is waived for the first year, but it's important to keep in mind that it won't be waived forever.
What Type of Rewards Card Fits You the Best?
Depending on the answers above, you'll want to consider the type of rewards card that will be the best fit for your dining habits and approval potential. Here are a few of the main categories:
- Restaurant-specific cards - These are cards with rewards that have been specifically tailored for people who eat out often at restaurants.
- Revolving category cards - These are cards where specific spending categories are more heavily rewarded each quarter. Generally, dining out and food are included as one of these categories. Points are often awarded at a higher rate of up to 5 percent, although that may have a limit.
- Universal spending cards - These are cards that reward users the same amount on every purchase they make, restaurant or not. Points are often 1 to 2 percent per dollar spent.
- Premium credit cards - These are cards that award users more points on certain expenses (usually dining out and travel) but also come with annual fees.
Is a Restaurant Rewards Credit Card Worth It?
The best thing anyone can do before applying for a restaurant rewards credit card is to run the numbers. Add up how much you spend in a typical month eating out and calculate how many points you can expect to receive with a rewards calculator.
Depending on the size of the reward, you can then weigh if getting a card with an annual fee would be worth it. However, if you eat out less than you thought but use credit frequently, then maybe a universal spending card or a card with revolving categories could make a better fit.
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Original Source: How to Find the Best Credit Card for Eating Out
