Formula: Net rewards value = (Bonus-category annual spend × bonus rate) + (Base-category annual spend × base rate) − annual fee.
All rates and spend figures are user-entered and editable. This calculator does not access real card terms, does not check approval eligibility, and does not represent a specific issuer's current program.
The calculator takes five monthly spending inputs — travel, dining, office supplies/software, advertising, and general/other — and two rate inputs. The first four spending categories are summed and multiplied by 12 to produce annual "bonus-category spend," on the assumption that these are the categories a business rewards card is most likely to pay an elevated rate on. The fifth category, general/other, is multiplied by 12 separately to produce annual "base-category spend," representing spending outside any bonus category. The bonus rate is applied only to bonus-category spend, and the base rate is applied only to base-category spend; the two results are added together to get gross annual rewards, and the annual fee is subtracted to produce the net figure shown as the headline result.
Inputs are collected as monthly figures because that's how most business owners naturally think about recurring costs, but the calculation itself runs on an annual basis because credit card annual fees, category caps, and most published reward benchmarks are expressed per year. Annualizing first (multiplying each monthly figure by 12) before applying a rate avoids a rounding mismatch that can occur if you calculate monthly rewards and then multiply the result by 12 instead.
This calculator does not model several things that affect a real card's value: annual or quarterly spending caps on bonus categories (once you exceed a cap, real cards typically drop to the base rate for the remainder of the period, which this tool does not simulate automatically); welcome or sign-up bonuses, which are one-time, applicant-specific, and change too frequently to build into a recurring annual formula; the actual redemption value of points or miles, since this tool assumes rewards are worth their stated percentage at face value, which is only strictly true for straightforward cash-back programs; foreign transaction fees, late fees, or interest charges, since the tool assumes the balance is paid in full and no foreign transactions occur; and any issuer-specific merchant-category-code exclusions that can cause a purchase you'd expect to be "bonus category" to actually earn the base rate instead.
The default example numbers pre-filled in the calculator are illustrative placeholders meant to demonstrate the formula, not a live snapshot of any card's current terms. Because every field is editable, the tool's accuracy for your own comparison depends entirely on entering your own real spending and the actual, current rates and fee published by the issuer you're evaluating — not on anything this site maintains centrally. We recommend re-verifying a card's current rates directly on the issuer's own page immediately before applying, since terms can change without notice.
This is an educational estimate, not a financial recommendation, and not a substitute for reading a card's full terms and conditions. It does not evaluate approval odds, credit-limit likelihood, or any personal-credit impact — see our business vs. personal credit guide for that topic separately. Where this site has any current affiliate relationship with a card issuer or network, it is disclosed on the Affiliate Disclosure page; that relationship never changes the formula above or how results are calculated or displayed.
Using the calculator's own default inputs as a reference: bonus-category spend of $500 (travel) + $300 (dining) + $800 (office/software) + $600 (advertising) = $2,200/month, annualized to $26,400. Base-category spend of $1,200/month annualizes to $14,400. At the default 3% bonus rate: $26,400 × 0.03 = $792. At the default 1% base rate: $14,400 × 0.01 = $144. Gross annual rewards: $792 + $144 = $936. Subtracting the default $95 annual fee gives a net annual value of $841. Changing any single input — a higher bonus rate, a different spending mix, or a higher annual fee — flows through this same sequence of steps to produce a new result, which is why the calculator recalculates instantly whenever a field changes.
The formula applies one flat rate to an entire category's annual total rather than modeling tiered or capped rates within a category, because doing otherwise would require assumptions about a specific card's exact cap structure that vary too much from issuer to issuer to generalize. If you know a specific card caps its bonus rate at, say, $25,000 of annual spend in a category before dropping to the base rate, you can approximate that manually: calculate the bonus-rate reward on spend up to the cap, calculate the base-rate reward on spend above the cap, and add the two figures together rather than entering the full amount at the bonus rate.
This methodology describes the calculation logic as implemented in the current version of the calculator on this page. Because the formula itself (not real-time card data) is what the tool relies on, there's no external data feed to go stale — but if the calculator's logic is ever revised, this page will be updated to match, and the "last verified" principle in our editorial approach applies: always cross-check a specific card's real, current terms directly with the issuer rather than relying solely on any example figures shown on this site.