#036: 5 Steps to Choose the Right Credit Card for Your Lifestyle

By: Ryan Greiser, CFP®

Read Time: 4 Minutes

When it comes to credit cards, one size does not fit all.

Selecting the right credit card is not just about who offers the biggest rewards—it's about finding the perfect match for your unique spending habits and lifestyle needs. In this guide, we'll walk through how to choose a credit card that maximizes your benefits, tailored just for you.

Let’s dive in.

Assess Your Spending Habits

Look closely at where you're spending your money. For my family, it’s primarily on groceries—about $2,000 per month—and we have a substantial travel budget of about $10,000 annually.

With this kind of spending pattern, it makes sense to target cards that offer substantial rewards on both groceries and travel.

By focusing on where we spend the most, I can pinpoint which cards offer the best returns in those specific categories, making every dollar work harder.

Take a moment to review your bank statements. Note your major spending areas to start shaping your credit card strategy. Here's the Google Worksheet I use ↓

Explore Cards That Match Your Spending and Needs

Once you know where your money goes, match it to a card that rewards those expenditures. As my children have grown—now ages 6, 4, and 2—we travel more, which shifted our credit card needs.

Our lifestyle change made me evaluate which cards would enhance our travel experiences without excessive costs.

This shift in lifestyle prompted me to look beyond basic no-fee cards to those offering more travel-specific benefits.

Consider how your lifestyle has evolved or will change in the future. Use tools like NerdWallet or The Points Guy to filter credit cards that meet your current needs and future aspirations.

Calculate Potential Rewards

Use reward calculators to see what you could be earning with different cards based on your spending.

This will help you understand whether paying an annual fee is worth the extra rewards you'll gain.

After some analysis, I realized switching from the no-fee Apple Cash Back Card to the AMEX Gold Card would net an additional $1,250 in rewards annually, even after the $250 fee.

Plug your spending into a rewards calculator like The Point Calculator to compare what you’re earning now against other card options.

Conduct a Lifestyle Fit Test

Make sure the perks of a card don't just sound good on paper—they should fit into how you actually live.

While the AMEX Platinum Card offered enticing benefits, the reality was the $695 fee and perks like extensive lounge access and entertainment credits didn’t align with my family’s actual usage.

Assessing these benefits critically, I decided the AMEX Gold was a better fit, avoiding unnecessary fees for perks we wouldn't use.

Write down the perks of your current or considered cards. Cross out those you won’t use and evaluate if the remaining benefits justify the cost.

Make a Switch If Necessary

Always be ready to reassess your card choices as your lifestyle and spending patterns evolve.

The no-fee Apple Cash Back Card served us well for years. However, changes in our spending habits and the benefits we sought prompted a switch to the AMEX Gold Card, which proved more beneficial given our current expenses.

Regularly review your credit card’s performance. If your spending habits or lifestyle change significantly, re-evaluate your card choices to ensure you’re still getting the best deal.

Conclusion

Choosing the right credit card is a dynamic process that aligns with your financial behavior and lifestyle needs.

By taking a proactive approach to evaluate and adapt your credit card choices, you can ensure you're always maximizing the benefits without falling into the trap of overpaying for unused perks.

Start optimizing your credit strategy today to make your financial tools work smarter for you.

I'll see you next week,