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For many people, rewards credit cards are considered the best out there. You can get paid back a small amount for purchases you’d normally make and might also receive enticing benefits.
Compare rewards credit cards
Best rewards credit cards
Ultimately, the “best” credit card comes down to your specific needs. However, there are many options that are well above the rest.
Here are a few excellent cards to help you start your search.
Quick look: Top rewards credit cards
- Best for flat-rate cash back: Citi® Double Cash Card
- Best for everyday purchases: Blue Cash Preferred® Card from American Express
- Best hotel credit card: Marriott Bonvoy Brilliant™ American Express® Card
- Best for premium travel: The Platinum Card® from American Express
- Best for travel rewards with no annual fee: PenFed Pathfinder Rewards American Express® Card
- Best for dining: Uber Visa Card
Best for flat-rate cash back: Citi® Double Cash Card
Best for everyday purchases: Blue Cash Preferred® Card from American Express
Best hotel credit card: Marriott Bonvoy Brilliant™ American Express® Card
Best for premium travel: The Platinum Card® from American Express
Best for travel rewards with no annual fee: PenFed Pathfinder Rewards American Express® Card
Best for dining: Uber Visa Card
The Uber Visa Card ties the Capital One® Savor® Cash Rewards Credit Card for best dining rewards. It pulls ahead with no annual fee, while its competitor charges a $95 annual fee starting the second year.Both cards offer strong elevated rewards for different categories. It’s worth comparing them closely before picking one.
How we selected our top cards
We compared several features among available reward cards, including reward categories, points earned per dollar spent, the average value of points upon redemption, welcome offer value, annual fees, introductory APRs and other perks or benefits a consumer might weigh when looking for a rewards card. The cards that stood out above the rest in one or more of these categories earned a spot on our list.
What’s changed in 2019
Marriott’s unveiling of its new Bonvoy loyalty program replaced the Starwood Preferred Guest Luxury Card with the excellent Marriott Bonvoy Brilliant™ American Express® Card.
The PenFed Pathfinder Rewards American Express® Card was introduced in 2018, but it’s worth mentioning the card is still the best no-annual-fee travel option. Meanwhile, the Uber Visa Card continues to overpower the Capital One® Savor® Cash Rewards Credit Card, offering strong value for no annual fee.
With a rewards credit card, you get a percentage back of what you spend. You’ll receive your rewards in the form of cash back, points or miles, which you can typically redeem through your card provider’s rewards portal. These points and miles represent a certain value in cash which can range depending on the rewards program.
For cashback cards, rewards are usually expressed as a percentage. If a card offers 2% cash back on all purchases, for example, you’ll receive $2 back for every $100 you spend.
For other cards, rewards are usually expressed as a point or mile multiple. A card might offer 2x points on all purchases, for example, which means you’ll receive 2 points for every dollar you spend.
Types of rewards credit cards
Here are a few types of rewards credit cards that you might encounter. Remember that while a card may offer stronger elevated rewards for one category, it can also offer lesser elevated rewards for other categories.
What are elevated rewards?
- Elevated rewards are cash back, points or miles that you earn at a higher rate than the base rate. Accelerated rewards is another name for elevated rewards.
For example, a card might offer 1% cash back on all purchases as its base rewards rate. But it might offer 3% cash back for gas. This means the card offers elevated rewards for gas.Back to top
Retail cards offer benefits and rewards tied to a particular retailer. You might only be able to use your card with the affiliated company.
Here’s an example: With the Forever 21 Credit Card, you’ll earn points for your spending, which you can redeem for rewards certificates at Forever 21. You’ll also receive perks like discounts and exclusive promotions. The card is valid only at Forever 21.
You’ll receive your rewards in the form of cash back, which you can usually redeem for statement credit or a deposit into your bank account. Some providers let you redeem for travel, gift cards and merchandise.
Here’s an example: The Chase Freedom Unlimited® credit card offers 1.5% cash back on every purchase after a cashback signup bonus of 3% back for the first year on up to $20,000, then unlimited 1.5% cash back after that. You can redeem points for statement credit and bank deposits. Gift cards, travel and experiences are also available through Chase Ultimate Rewards.
Category-specific — Gas, grocery, dining, etc.
You’ll receive elevated rewards when you use your card for a certain category. For example, you might receive 3% cash back for one category instead of 1%, which is the normal rewards rate for purchases. Some cards have spending caps for the highest rewards rates.
Here are examples of credit cards for certain categories:
- Gas: Costco Anywhere Visa® Card by Citi. You’ll earn 4% cash back on eligible gas purchases worldwide for the first $7,000 per year, then 1%.
- Groceries: Blue Cash Preferred® Card from American Express. Earn 6% cash back at US supermarkets on up to $6,000in purchases per year, then 1%.
- Dining: Capital One® Savor® Cash Rewards Credit Card. Earn 4% cash back on dining.
You’ll typically earn bonus miles when you spend on flights with a cobranded airline. Later, you can redeem miles for rewards like flights and car rentals through the airline’s rewards portal.
This card type often includes airline-specific perks like priority boarding and free checked baggage.
Here’s an example: United℠ Explorer Card
A hotel credit card offers bonus points when you spend with a certain hotel chain. You can often redeem points through the chain’s rewards portal for hotel stays, travel packages, point transfers and more. Here are a few of our favorite hotel loyalty programs on the market.
Usually, this card type also includes hotel-specific perks like loyalty-program upgrades and resort credits.
Here’s an example: Hilton Honors American Express Card. Earn 7x points at the Hilton Portfolio of hotels and resorts. Earn 5x points at US restaurants, US supermarkets and US gas stations and 3x points on all other eligible purchases.Back to topBack to top
How to choose a rewards card
- Think about what kind of rewards you want.
Do you want cash back, store points or travel rewards? Each has different redemption options as well as pros and cons. Some rewards programs are better suited for certain types of rewards than others.
- Cash back is typically easy to understand and redeem. However, it may not be as valuable as travel rewards.
- Store points can help you shop at a certain retailer. But you might find them restrictive, as they can only be redeemed with your card’s affiliated company.
- Travel rewards can be very valuable, depending on what you redeem them for. But they can take time to understand, and you want to be careful not to redeem them for less than the industry average.
- Decide if you want to pay an annual fee.
This simple step can quickly help you narrow down your options. Many cards offer decent rewards for no annual fee. If you want the most powerful rewards rates, you’ll usually need to pay an annual fee. Annual-fee cards often come with additional perks such as fee credits and access to airport lounges.
- See where you spend the most money.
To get the biggest bang for your buck, look for a card that offers elevated rewards for the categories you spend the most in. For example, if most of your budget goes toward groceries, it might not make sense to get an airline card — consider a grocery card instead. And if you’re always eating out, you might like a dining card. There are even cards that can help you earn additional rewards when you shop through services like PayPal.
What else should I consider when picking a rewards card?
Cards that offer bonus points to new customers can help you kickstart your rewards points. You’ll likely need to meet some eligibility requirements before you can claim the points. For example, you may need to spend a certain amount on your card in the first few months.
Many rewards cards limit how you can earn and redeem points. If a card has a cap on elevated rewards for certain categories, you may want to look elsewhere if you’re a big spender. Keep an eye out for expiration dates on your rewards, too.
Interest rates vary from card to card. Comparing these, along with your spending habits, will help you calculate how much you’ll have to repay over time.
Some rewards cards offer introductory interest rates — often 0% APR — on purchases, balance transfers or both. If you want to make a balance transfer, consider paying off your debt entirely before making new purchases with your card.Back to top
How to maximize your credit card rewards
Were you approved for a rewards card? That’s great news. Now here are a few steps to squeeze as many rewards from it as possible. For more tips, check out our full reward redemption guide.
Grab the signup bonus.
Your card probably has a signup bonus. This typically comes in the form of significant rewards if you reach a spending threshold within a certain time.
Check your card’s signup-bonus requirements and calculate how much you need to spend per month to meet them. You don’t have to strain your budget just to get the bonus. However, there are many hacks that can help you reach the spending threshold.
Spend more in your elevated-rewards categories.
Your card might offer elevated rewards for certain purchase categories. If that’s the case, use it for those purchases as much as you can.
For example, if your card pays 6% cash back on groceries, it’s a no-brainer to use your card at the grocery store as much as you can. Meanwhile, the card might offer just 1% cash back on all other purchases. For those purchases, you might want to use a card that offers a solid rewards rate — for example, 1.5% cash back — on everything you buy.
Redeem your rewards for high-value options.
With a cashback card, your rewards rate easily translates to your redemption value. For example, if your card pays 1.5% cash back and you spend $1,000 a month, you know you’ll earn $1,000 x 1.5% = $15 in rewards monthly.
Point- or mile-based cards can be a little trickier. Some cards make it easy with automatic rewards redemption — usually for statement credit. Other cards have many redemption options, and give you different values for your rewards.
The credit card industry generally values a point or mile at 1 cent each. If you have 10,000 points, then, they’re usually worth around $100. Try to get value from your rewards at or above this rate.
How to calculate redemption valueSee how much your points or miles are worth for certain redemption options by following these steps:
- Check the monetary value of the redemption option. For example, you might be looking at a $25 gift card.
- See how many points or miles you must trade. Let’s say you need to redeem 3,000 points to get the gift card.
- Divide the redemption’s monetary value by the number of points or miles you must redeem. With some quick math, you’d see that $25 / 3,000 = 0.008. That means your points would be worth 0.8 cents apiece if you redeemed them for this gift card. That’s less than the industry standard of 1 point = 1 cent, so it’s a mediocre deal.
Pros and cons of using a rewards credit card
- Rewards. You can choose a card that fits your lifestyle and earn rewards on purchases you would have made anyway.
- Redeeming rewards. Redemption options vary from card to card. You may be able to earn cash back, travel benefits, merchandise, gift cards and more.
- Global acceptance. Most rewards cards are affiliated with Visa or Mastercard, and you can use these cards in over 200 countries and territories worldwide. While American Express and Discover credit cards aren’t as widely accepted internationally, they can be used in many locations around the world.
- Extra perks. Many rewards cards offer extra perks, such as complimentary travel and rental car insurance. Compare your options to see which features work best with your lifestyle and spending habits.
- Cost. You may have to pay an ongoing annual fee, or your card may have a higher APR than your basic, no-frills product.
- Limitations. Your card provider might not let you earn more than a certain number of points in a calendar year, and your points may expire after a set time.
- Temptation to spend. Rewards are always enticing. But if you aren’t careful, you could find yourself in snowballing debt. If you consistently carry a balance on your card, the interest could offset any rewards you earn.
Are rewards credit cards really worth it?
If you use it wisely, your rewards card can be valuable and could pay off handsomely. Here are the rewards you might earn based on the following sample budget. We’ll use the Bank of America® Cash Rewards credit card for our example.
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With no annual fee, the card offers valuable rewards. Over a year, you’d earn cash back worth $308.
Who should use a rewards card?
Who are rewards cards best suited to?
- Frequent spenders. If you plan on using your credit card frequently, you can benefit with strong rewards.
- Loyal customers. If you do most of your shopping through a particular store, a retail card can reward you especially well versus another rewards card.
- Cardholders who make regular payments. Making timely payments is crucial if you wish to make the most of your rewards credit card. If you keep a balance on your card, you’ll accrue interest that will eat into your rewards.
Who are rewards cards not suited to?
- People in debt. If you’re in debt, consider a balance transfer card rather than a rewards card. It may be wise to avoid the temptation of earning rewards through additional spending.
- Irregular spenders. If you don’t use your credit card regularly, it may not be worth paying the fees for a rewards card. This product type is only beneficial if the monetary value of your rewards exceeds the costs of the card.
There’s no shortage of rewards credit cards to choose from. Think about what rewards you want and how you typically spend, then compare a few cards before settling on the winner.
If you’re not sure you want a rewards card yet, consider other options like 0% APR cards.Back to top
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