Conventionally, there were few tools available to households that wanted to manage their money wisely: spreadsheets, budgeting apps, research, etc.

With the advent of rewards credit cards in the US (the first travel rewards cards became available in the 1940s, but didn’t really catch on with consumers until the 1980s), selecting a payment method became more complex as well. A small subset of consumers are points optimizers, focused on manually allocating spend to the best card to maximize points, but most people only use one two payment methods.

Card rewards programs and benefits have also become more complex, with many premium and rewards cards offering large menus of benefits that most customers don't end up leveraging:

Kudos, a financial companion platform with 300,000 customers, analyzed spending patterns to evaluate the implied costs to consumers who didn't optimize their card usage. Some survey data from their users:

📌 Wrong card, wrong swipe: Using the wrong credit card for purchases costs the average user $441/year in foregone potential rewards.

📌 Perks left on the table: Unused travel credits, streaming discounts, and shopping benefits add up to an average of $624/year in missed potential value.

📌 Paying unnecessary card fees: Many credit cards aren’t worth keeping if the benefits don’t outweigh the fees.

📌 Overpaying for insurance: Users who check their auto insurance rates save an average of $800/year by switching providers.

Using the Wrong Card for Purchases Costs Users Hundreds Per Year

• Many people unknowingly use the wrong credit card for their purchases, resulting in missed rewards.
• Nearly half of all transactions are made with a suboptimal card, meaning users do not earn the highest possible rewards.
• According to Kudos data, the average user with two to three credit cards misses out on approximately $441 in extra rewards each year by not using the best card for each transaction.

Many Users Overlook Credit Card Perks and Benefits

• Credit cards often come with valuable benefits that cardholders either forget to redeem or are unaware of.
• These benefits can include free travel credits, complimentary memberships, dining and rideshare credits, and extended warranties.
• The average Kudos user leaves $624 in unused credit card benefits on the table each year.
• Some of the most commonly overlooked perks include:
  • Airline and hotel travel credits
  • Complimentary subscriptions to services like DashPass, Instacart+, and streaming platforms
  • Rideshare and dining statement credits
  • Purchase protection, extended warranties, and price matching services

Identifying Annual Fees That Are Not Worth Paying

• Many premium credit cards charge high annual fees in exchange for perks, but not all users get enough value to justify the cost.
• Some cardholders continue paying for cards that no longer align with their spending habits.

Helping Users Save on Auto Insurance

• Many people do not regularly compare auto insurance rates and end up overpaying for coverage.
• The average Kudos user saves $800 per year simply by switching to a better auto insurance provider.

To help people more intelligently leverage their card benefits and prevent overspending, Kudos recently launched a new product called Insights:

How Insights Works

• Insights integrates with a user’s credit card accounts and analyzes transaction data to provide personalized recommendations.
• It continuously updates as new transactions occur, ensuring that recommendations remain relevant.
• The platform covers nearly 3,000 credit cards, including over 95 percent of cards that are not linked to affiliate commissions.
• All recommendations are based on real data and fact-checked by a team with combined experience from Google, Affirm, Honey, and in credit cards and personal finance.

Finding Additional Ways to Earn More Rewards and Save on Interest

• Beyond optimizing everyday spending, Insights helps users take advantage of other money-saving opportunities.
• It identifies:
  • Retailers that offer higher cashback or bonus rewards with specific credit cards
  • Credit cards with lucrative sign-up bonuses that align with a user’s spending patterns
  • Balance transfer opportunities that allow users to move existing credit card debt to a lower-interest option, potentially saving thousands in interest charges
• By highlighting these additional strategies, Insights helps users make more informed financial decisions and maximize the value of their credit cards.