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The No. 1 mistake people make with their cash-back credit cards

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Cash-back credit cards are pretty easy to use, and that's a big reason why many Americans report having at least one.

But there is one major mistake you can make with these credit cards that can end up costing you in the long run: not paying off your balance in full every month.

Nearly half, 47%, of Americans carry a monthly balance on their credit cards, according to a recent survey of 1,000 credit card users by real estate data company Clever. Of those, over 70% say their balance is more than $1,000 on average.

That can be a significant expense, especially since the average APR among credit cards that charge interest is 17.14% as of June 2019, according to the U.S. Federal Reserve.

And it can be worse if you're using a cash-back card, which is considered a "rewards" credit card because you earn a bonus on your spending. These types of credit cards tend to have higher interest rates, on average, than others.

Anyone who carries a balance, even occasionally, should prioritize their interest rate over rewards. If you're struggling to pay off debt, that may mean avoiding credit cards entirely and sticking to debit and cash.

What happens if you can't pay off your card every month

If you're not able to pay off your balance each month, the interest can far outweigh the rewards.

The worst case scenario is having a rewards card, such as a cash-back card, and only paying the minimum each month. Let's say you have $6,028 in credit card debt, which is the national average among those who carry a balance, according to Experian. If your card charges the average APR of 17.14% and you only pay the minimum each month (3%, or roughly $181 a month), you'll be in debt nearly four years and pay over $2,200 in interest.

If you're in that situation, it might be worth considering a balance transfer credit card, which allows you to pay off the credit card debt without accruing new interest for a set period of time, sometimes up to almost two years.

For example, the Amex EveryDay® Credit Card, CNBC Select's top pick for the best balance transfer card, offers 0% interest on balance transfers and purchases for 15 months (14.49% to 25.49% variable APR after that). You could save more than $1,500 in interest charges if you transferred $6,028 in debt, took full advantage of the intro period and paid $200 a month toward your balance.

What to consider when choosing a cash-back card

If you pay off your balance each month, a cash-back card can save you money. Last year, cash-back cardholders earned an average of $278 back, according to a recent report from Lightspeed Financial Service Group. And, according to our calculations, the average American could earn $656 in cash-back rewards the first year with our No. 1 pick for the best cash-back credit card, the Alliant Cashback Visa® Signature Card.

When choosing a cash-back card, it's a good idea to evaluate where you spend the most so you can maximize your rewards. Cash-back cards like the Capital One® Savor® Cash Rewards Credit Card, for example, are designed for those who dine out a lot. But if you don't spend a lot at restaurants, that type of card may not be right for you.

Before you sign up for a cash-back credit card, take a minute to figure out if you can afford to pay off your balance consistently. Rewards are a great perk, but you should never lose sight of your long-term financial goals in the name of rewards optimization.

For rates and fees of the Amex EveryDay® Credit Card, please click here.

Information about the Amex EveryDay®, Capital One® Savor® Cash Rewards and Alliant Cashback Visa® Signature, has been collected independently by CNBC and has not been reviewed or provided by the issuer of the cards prior to publication.

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the CNBC Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.