Credit cards with no annual fee 2023

How to compare no-annual-fee credit cards

There are so many great no-annual-fee cards out there that it can be hard to choose the right one. To help you narrow down your options, here’s what to consider:

• Rewards program. Many no-annual-fee cards come with a rewards program. You can either get a card with a high cashback rate on select categories like travel, dining, groceries or gas, or you can get a card with the same rewards rate on all purchases.
• Interest-free period. A 0% intro APR period on purchases, balance transfers or both is a common feature of no-annual-fee credit cards. You can get up to 15 months of an interest-free period with a rewards credit card or up to 20 months with a card with no rewards program.
• Signup bonus. A signup bonus can give you a burst of rewards soon after you’re approved for a card. Many no-annual-fee cards have bonuses worth between $50 and $300, and some cards even more.
• Choices depend on your credit score. Your credit score has a big effect on which cards you’ll be approved for. For rewards cards and products with intro APRs, you’ll usually want to apply with a good to excellent credit score of 670 or higher. If your score is lower than that, consider a no-annual-fee secured credit card to build your credit.

What is an annual fee?

An annual fee is a yearly cost to keep a credit card. If your card has one, the annual fee is charged automatically each year, typically during the month you opened your account.

With a no-annual-fee card, you won’t have to pay this cost, which helps you minimize the expense of owning a credit card.

Annual fees typically range from as low as $30 to as high as $550. Some providers waive the annual fee in the first year, giving cardholders 12 months to enjoy their cards at no cost. That said, a card with an annual fee typically comes with more perks and benefits that can offset the fee.

When is paying an annual fee worth it?

Typically, paying an annual fee can be justified for those who spend heavily on a particular category that offers the highest rewards. For example, the Blue Cash Everyday® Card from American Express earns 3% back at U.S. supermarkets on up to $6,000 annually and 1% after that.

On the other hand, the Blue Cash Preferred® Card from American Express earns much higher rewards in the same category but charges an annual fee. The Blue Cash Preferred® offers 6% back at US supermarkets on up to $6,000 per year, then 1%, and you can redeem rewards for a statement credit. However, the card costs $95 annually after the first year annual fee (Terms apply, see rates & fees).

Here’s how both compare:

Who should get a no-annual-fee credit card?

Whether you choose a no-annual-fee credit card depends on what you need out of your card financially. Here’s a quick rundown of whether you might apply for one.

Get a no-annual-fee credit card if you:

• Only plan on using your card occasionally. Having a card that features an annual fee but only occasionally using that card is often a needless drain on your wallet.
• Want a card to help you build credit. It’s helpful to get a card without an annual fee if you’re focused on building credit and you don’t want your card to get in the way of your finances.
• Aren’t interested in numerous perks and features. While cards with annual fees typically more than make up for their fees with their perks, you’ll be paying that fee for no reason if you don’t often use your card’s extra features.

Pick something else if:

• You plan on using your card’s perks and features. So long as you’re using those extra perks that come with your annual fee card, you’ll usually more than make up for the card’s cost.
• You have no other choice and you need to build credit. Sometimes an annual fee is the “buy-in” cost of a credit-building card when you have poor credit. In this case, it can make sense to pay the annual fee, especially if you couldn’t easily build credit otherwise.

Are there no-annual-fee credit cards with rewards?

Yes, a lot of no-annual-fee credit cards offer rewards. Depending on the card, you can earn cash back, points or travel miles. For example, the Chase Freedom Flex℠ offers 5% cash back in rotating categories on up to $1,500 in combined purchases each activated quarter (1% after reaching the cap), 5% on travel purchased through Chase, 3% on dining and drugstores and 1% on all other purchases.

How do credit cards with $0 annual fee for the first year work?

This is an introductory offer where the card’s annual fee is charged at the end of the first year. The annual fee is typically applied on the anniversary of your account opening, and every 12 months thereafter. You may see an offer that reads something like “$89 annual fee (waived first year)”.

How do I get my credit card annual fee waived beyond the promotional first-year offer?

Unfortunately, most credit card owners won’t be able to get an extension of the annual fee waiver. However, service members on active duty can get Servicemembers Civil Relief Act (SCRA) benefits, which include an annual fee waiver among the other perks.

Credit card issuers that offer SCRA benefits are:

• American Express
• Barclays
• Capital One
• Chase
• Citi

Most of these issuers may only waive the annual fee to those who were cardmembers prior to going on active duty. For additional information, contact your card issuer.

Bottom line

A no-annual-fee card can help you keep costs down. It can also offer great rewards and benefits you didn’t expect.

If you want more options, there are plenty of credit cards to compare. Check out our guide to the best credit cards of 2023.