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How to use credit card rewards to earn up to $500 a year. The perks you need to know

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How credit card rewards work and the tricks people use to get the most out...

Credit cards can be a valuable tool if you use them responsibly.

You can earn roughly $400 to $500 per year in rewards, according to a recent CNBC Select analysis.

And getting money back isn't the only benefit.

When you use cash or your debit card, you get what you pay for and not much else. Credit cards, on the other hand, offer you perks such as cancellation insurance, transaction protection and, of course, ways to be rewarded for your purchases. Every dollar you spend leads to more bonuses.

Those rewards generally come in three different forms: points, miles and cash back.

The most important thing to remember is to pay your balance in full every month, because no amount of rewards will be enough to justify the average 17% interest rate for credit cards.

Watch this video to find out more about how credit card rewards are calculated and for more tips on what type of card might be right for you.

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Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.