Don’t automatically choose the card with the highest Velocity Points earning rate. It may not be the best one for you, because the amount you spend each year may not be enough to justify a high annual fee.
Start by working out how many Velocity Points you would earn in a year from your annual credit card spending, by checking your spending on your current credit card in the previous year. Multiply the dollars you spent by the Velocity Points earning rate per dollar on the card you are considering. Valuing each Velocity Point at a reasonably modest 1.0 cents, you’ll be able to decide if it’s worth paying the card’s annual fee.
E.g. Annual card spending $18,000 X 0.66 Velocity Points per dollar = 11,880 Velocity Points.
11,880 Velocity Points = $118.80. Annual card fee = $129. The conservative points value is slightly less than the annual fee, but recovers most of it. In fact, you should be able to extract a much greater value than 1.0 cents from each Velocity Point (depending on what type of award seat you are able to secure), easily recovering far more than the the cost of the annual fee. But avoid using your points for redemptions other than flights – you’re likely to get a value of only 0.5 cents per point, or even less.
