Rewards credit cards take some of the sting out of spending your hard-earned money. The best rewards cards provide cash back or points for every dollar spent, and sweeten the pot with a nice sign-up bonus. Cheapism.com analyzed some of the most popular offerings to find the best rewards cards.
Methodology.Cheapism evaluated rewards credit cards based on several criteria. First, the rewards must be easy to claim, which is why there aren't any airline or hotel cards on the list; company-specific rewards can be hard to value and redeem. The credit cards listed here let cardholders redeem rewards for cash or credit on a monthly statement. Second, the cards must have no annual fee or the fee must be waived the first year. Another incentive to look for is a good sign-up bonus, which has a big impact on the overall reward value. However, sign-up bonuses have gotten a little stingier in recent years and can vary depending on when and where you apply. As always, read the fine print carefully to optimize your selection.
Barclaycard Arrival Plus
Purchases made with the Barclaycard Arrival Plus card earn points that can be used to pay for future purchases. Every dollar spent earns 2.2 percent when points are applied to travel-related transactions, making this one of the best cash-back cards on the market.
Signup Bonus: 40,000 points after spending $3,000 within 90 days.
Bonus Value: $200 in statement credit; $440 if used for travel spending.
Earnings: 2 percent back for every dollar spent, plus a 10 percent bonus on points redeemed for travel.
Fee: $89/year; first year waived.
Other Perks: No foreign transaction fees; free FICO credit score.
Capital One Venture Rewards
Cardholders earn 2 percent cash back on every purchase. However, the earnings can be used only for travel-related expenses.
Signup Bonus: 40,000 points after spending $3,000 within three months.
Bonus Value: $400 toward travel spending.
Earnings: 2 percent back for every dollar spent.
Fee: $59/year; first year waived.
Other Perks: No foreign transaction fees; free credit score tracking.
Chase Sapphire Preferred
Rewards from Chase come in the form of points redeemable for cash, prizes, gift cards, and travel. A bonus for booking travel with points nets up to 2.5 percent cash back when the card is used for dining or travel-related services. A big advantage is that points can be transferred to some travel providers' loyalty programs.
Signup Bonus: 40,000 points after spending $4,000 within three months.
Bonus Value: $400 in cash or gift cards; $500 if used for booking travel.
Earnings: 1-2.5 percent back for every dollar spent.
Fee: $95/year; first year waived.
Other Perks: 20 percent discount when using points to book travel; no foreign transaction fees; primary rental car collision damage waiver; transfer points to airline, hotel, and train rewards programs.
Each quarter, the no-fee Freedom card generates 5 percent back (as points) on select spending categories, such as department stores and grocery stores. Other categories earn 1 percent back. Customers can transfer points from the Freedom card to a Chase Sapphire Preferred or Ink Plus card for a redemption boost, earning 6.25 percent cash back when using points to book travel.
Signup Bonus: 10,000 points after spending $500 within three months.
Bonus Value: $100 in cash or gift cards.
Earnings: 1-5 percent back for every dollar spent.
Other Perks: 5 percent bonus on rotating categories.
Chase Ink Plus
This business card from Chase lets users transfer points between cards, including between personal and business accounts. Cardholders earn up to five points per dollar when paying for phone, Internet, or cable service or buying office supplies.
Signup Bonus: 60,000 points after spending $5,000 within three months.
Bonus Value: $600 in cash or gift cards; $750 if used for booking travel.
Earnings: 1-6.25 percent back for every dollar spent.
Fee: $95/year; first year may be waived if you apply at a local branch.
Other Perks: 20 percent discount when using points to book travel; no foreign transaction fees; increased purchase and return protection; transfer points to airline, hotel, and train rewards programs.
American Express Blue Cash Everyday
The American Express Blue Cash Everyday card earns 3 percent back at supermarkets, 2 percent back at gas stations and select department stores, and 1 percent everywhere else. Earnings (aside from the sign-up bonus) come in the form of American Express points that can be redeemed for account statement credit or spent at eligible merchants, including Amazon and Uber. A more rewarding Blue Cash Preferred card is also available, although it has a $75 annual fee.
Signup Bonus: $100 back after spending $1,000 within three months.
Bonus Value: $100 in statement credit.
Earnings: 1-3 percent back for every dollar spent.
Other Perks: No annual fee, even after the first year; car rental loss and damage insurance.
BankAmericard Travel Rewards
Bank of America's no-fee card offers 1.5 percent back on every purchase. It's not the most rewarding card and the points must be used for travel expenses, but it's a nice option for consumers who don't want to worry about tracking which rotating categories confer the highest rewards. The initial sign-up bonus is also attractive. Bank of America checking or savings account holders earn an extra 10 percent bonus points.
Signup Bonus: 10,000 points after spending $500 within 90 days.
Bonus Value: $100 toward travel spending.
Earnings: 1-1.65 percent back for every dollar spent.
Other Perks: No foreign transaction fees.
Citi Double Cash
Another no-fee card, the Citi Double Cash card delivers 1 percent back on every purchase, plus an additional 1 percent back when the bill is paid. There's no signup bonus, which makes this less appealing than other cards, but 2 percent back on every purchase is a strong offering for a no-fee card.
Signup Bonus: None.
Earnings: 1-2 percent back for every dollar spent.
Other Perks: No category restrictions.
Discover cards still aren't accepted everywhere, but the Discover It card has no annual fee and offers up to 5 percent cash back in different categories. Cash back can be used to offset a statement balance or make purchases on Amazon.
Signup Bonus: None.
Earnings: 1-5 percent back for every dollar spent.
Other Perks: Free FICO credit score; freeze your account through the Discover mobile app or website; no foreign transaction fees; access to Discover Deals, an cash-back online shopping portal.
Final Tips.Rewards credit cards generally have higher interest rates than other cards. If you know you're going to be spending more than you can pay by the due date, avoid using a rewards card.
If you choose a rewards card with an annual fee that is waived for the first year, set a calendar notice for 11 months after the card is activated. When the time comes, call the bank and explain that the benefits of the card aren't worth the fee. Sometimes the company will waive the fee or offer other incentives to keep the account open. If the bank won't budge (the Chase Sapphire Preferred card, for example, has a reputation for rarely waiving the fee), ask if there's a no-fee version of the same card. Often, the no-fee card comes with fewer benefits but the account remains open, which helps build credit history.