Cashback Rewards Calculator
Find the real value of a cashback card — yearly rewards on your spending, net of the annual fee, and the spend needed to break even.
How it works
Gross cashback = annual spend × rate · Net = gross − annual fee · Break-even spend = fee ÷ rate
Cashback is only worth what remains after the card’s annual fee. A high headline rate on a fee card can be worse than a lower-rate no-fee card if your spending is modest, because the fee is fixed while the rewards scale with spending. The break-even spend — annual fee divided by the cashback rate — is the amount you must charge just to earn back the fee; below it, the card costs you money.
Worked example
Spending $2,000 a month at 2% back earns $24,000 × 2% = $480 a year. After a $95 annual fee, net rewards are $385. The break-even is $95 ÷ 2% = $4,750 of annual spend — well below the $24,000 charged, so the fee is easily justified here.
Frequently asked questions
Is a cashback card worth the annual fee?
Only if your rewards exceed the fee. Compare your net (rewards minus fee) against a no-fee card at a lower rate — sometimes the no-fee card wins for lower spenders.
What is break-even spend?
The annual spending at which cashback exactly equals the fee (fee ÷ rate). Spend more than that and the card pays; spend less and it costs you.
Does carrying a balance change the math?
Yes, dramatically. Interest charges on a revolving balance dwarf any cashback rate, so rewards only make sense if you pay the statement in full each month.
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Educational estimate, not financial advice.