Best Rewards Credit Cards of 2020

Rewards credit cards can help you make the most of your everyday expenses. If you’re able to spend responsibly and pay your balance in full each month, why not earn rewards on the purchases you’re already making?

When deciding what type of rewards credit card to apply for, you need to ask yourself two questions. First, what are your spending habits? Do you tend to spend a lot in one or two categories or does it vary? Second, what type of rewards would be most valuable to you – cash back, travel points or airline miles?

With so many options, choosing a rewards credit card can be daunting. Our team of experts analyzed 1,640 rewards credit cards to give you our top picks. Check out the best rewards credit cards from our partners below.

Rewards credit cards can help you make the most of your everyday expenses. If you’re able to spend responsibly and pay your balance in full each month, why not earn rewards on the purchases you’re already making?

When deciding what type of rewards credit card to apply for, you need to ask yourself two questions. First, what are your spending habits? Do you tend to spend a lot in one or two categories or does it vary? Second, what type of rewards would be most valuable to you – cash back, travel points or airline miles?

With so many options, choosing a rewards credit card can be daunting. Our team of experts analyzed 1,640 rewards credit cards to give you our top picks. Check out the best rewards credit cards from our partners below.

Editor: Laura Mohammad | Writer: Mariah Ackary

|

August 13, 2020

Best Rewards Credit Cards

  • Wells Fargo Propel American Express® Card: Best for no annual fee
  • Capital One® Venture® Rewards Credit Card: Best for travel rewards
  • Chase Sapphire Preferred® Card: Best for sign-up bonus
  • Capital One® Quicksilver® Cash Rewards Credit Card: Best for cash rewards
  • Discover it® Cash Back: Best for rotating category rewards
  • Capital One® SavorOne® Cash Rewards Credit Card: Best for dining and entertainment
  • Capital One® VentureOne® Rewards Credit Card: Best for flat rewards rate
  • Bank of America® Cash Rewards Credit Card: Best for customizable rewards
  • Southwest Rapid Rewards Plus Credit Card: Best for airline rewards
  • Ink Business Unlimited℠ Credit Card: Best for business cash back
  • Blue Cash Preferred® Card from American Express: Best for everyday purchases

Good to Excellent

Credit Recommended (670-850)

CreditCards.com credit ranges are a variation of FICO® Score 8, one of many types of credit scores lenders may use when considering your credit card application.
Apply Now

Rewards Rate

1.25X
Earn unlimited 1.25X miles on every purchase, every day.

At A Glance

Intro Bonus
20,000 miles

Earn a bonus of 20,000 miles once you spend $1,000 on purchases within 3 months from account opening, equal to $200 in travel

Annual Fee
$0
Regular APR
15.49% - 25.49% variable

Good to Excellent

Credit Recommended (670-850)

CreditCards.com credit ranges are a variation of FICO® Score 8, one of many types of credit scores lenders may use when considering your credit card application.
Apply Now

Rewards Rate

5%
Earn 5% cash back on grocery store purchases (not including Target® or Walmart® purchases) on up to $12,000 spent in the first year.
5%
Earn 5% cash back on up to $1,500 in combined purchases in bonus categories each quarter you activate. Enjoy new 5% categories each quarter!
5%
Earn 5% on travel purchased through Chase.
3%
Earn 3% on dining at restaurants and drugstores.
1%
Earn 1% on all other purchases.

At A Glance

Intro Bonus
$200

Earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening.

Annual Fee
$0
Regular APR
14.99% - 23.74% variable

Good to Excellent

Credit Recommended (670-850)

CreditCards.com credit ranges are a variation of FICO® Score 8, one of many types of credit scores lenders may use when considering your credit card application.
Apply Now

Rewards Rate

3%
Earn unlimited 3% cash back on dining and entertainment
2%
Earn 2% at grocery stores
1%
Earn 1% on all other purchases

At A Glance

Intro Bonus
$150

Earn a one-time $150 cash bonus after you spend $500 on purchases within the first 3 months from account opening

Annual Fee
$0
Regular APR
15.49% - 25.49% variable
See Rates & Fees, Terms Apply

Good to Excellent

Credit Recommended (670-850)

CreditCards.com credit ranges are a variation of FICO® Score 8, one of many types of credit scores lenders may use when considering your credit card application.
Apply Now

Rewards Rate

4X
Earn 4X Membership Rewards® Points on Restaurants worldwide, including takeout and delivery.
4X
Earn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1X).
3X
Earn 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.

At A Glance

Intro Bonus
35,000 points

Earn 35,000 Membership Rewards® Points after you spend $4,000 on eligible purchases with your new Card within the first 3 months.

Annual Fee
$250
Regular APR
See Pay Over Time APR

Good to Excellent

Credit Recommended (670-850)

CreditCards.com credit ranges are a variation of FICO® Score 8, one of many types of credit scores lenders may use when considering your credit card application.
Apply Now

Rewards Rate

2X
2 points per $1 spent on Southwest® purchases and Rapid Rewards® hotel and car rental partner purchases.
1X
1 point per $1 spent on all other purchases.

At A Glance

Intro Bonus
40,000 points

Earn 40,000 points after you spend $1,000 on purchases in the first 3 months your account is open.

Annual Fee
$69
Regular APR
15.99% - 22.99% variable

Excellent

Credit Recommended (740-850)

CreditCards.com credit ranges are a variation of FICO® Score 8, one of many types of credit scores lenders may use when considering your credit card application.
Apply Now

Rewards Rate

5X
Earn 5x rewards on up to $1,500 in combined purchases each quarter in popular categories such as dining, groceries, travel, and automotive
1X
Earn Points on Every Purchase! It’s simple: $1 = 1 Point

At A Glance

Intro Bonus
$150

Earn $150 Statement Credit after you spend $1,200 on purchases within the first 90 days from account opening

Annual Fee
$0
Regular APR
12.90% - 22.90% variable

Fair to Good

Credit Recommended (580-740)

CreditCards.com credit ranges are a variation of FICO® Score 8, one of many types of credit scores lenders may use when considering your credit card application.
Apply Now

Rewards Rate

5%
Get 5% cash back rewards on the first $5,000 of eligible gas, grocery, internet, cable, satellite TV, and mobile phone service purchases each year, and then 1% thereafter.
1%
1% cash back rewards on all other purchases. Terms Apply.

At A Glance

Intro Bonus
No current offer
Annual Fee
$95
Regular APR
23.99% variable

Good to Excellent

Credit Recommended (670-850)

CreditCards.com credit ranges are a variation of FICO® Score 8, one of many types of credit scores lenders may use when considering your credit card application.
Apply Now

Rewards Rate

3X
Earn 3X Bonvoy points per $1 spent at over 7,000 hotels participating in Marriott Bonvoy™.
2X
2X Bonvoy points for every $1 spent on other travel purchases (from airfare to taxis and trains).
1X
1X point for every $1 spent on all other purchases.

At A Glance

Intro Bonus
50,000 Points

Limited Time Offer! Earn 50,000 Bonus Points after you spend $1,000 on purchases in the first 3 months from account opening.

Annual Fee
$0
Regular APR
15.99% - 22.99% variable

Excellent

Credit Recommended (740-850)

CreditCards.com credit ranges are a variation of FICO® Score 8, one of many types of credit scores lenders may use when considering your credit card application.
Apply Now

Rewards Rate

4%
4% cash back on eligible gas for the first $7,000 per year and then 1% thereafter
3%
3% cash back on restaurants and eligible travel purchases
2%
2% cash back on all other purchases from Costco and Costco.com
1%
1% cash back on all other purchases

At A Glance

Intro Bonus
No current offer
Annual Fee
$0
Regular APR
15.24% (Variable)
See Rates & Fees, Terms Apply

Good to Excellent

Credit Recommended (670-850)

CreditCards.com credit ranges are a variation of FICO® Score 8, one of many types of credit scores lenders may use when considering your credit card application.

Rewards Rate

3X
Earn 3X Membership Rewards® Points on Restaurants worldwide, including takeout and delivery.
3X
Earn 3X Membership Rewards® points on all eligible travel, from subway swipes and window seats to hotel stays and city tours.

At A Glance

Intro Bonus
30,000 points

Earn 30,000 Membership Rewards® points after you spend $2,000 on purchases on your new Card in your first 3 months.

Annual Fee
$150
Regular APR
See Pay Over Time APR

Editorial disclosure: All reviews are prepared by CreditCards.com staff. Opinions expressed therein are solely those of the reviewer and have not been reviewed or approved by any advertiser. The information, including card rates and fees, presented in the review is accurate as of the date of the review. Check the data at the top of this page and the bank's website for the most current information.

All information about Capital One® Savor® Cash Rewards Credit Card, Capital One® Walmart Rewards Mastercard, Ink Business Unlimited℠ Credit Card, Chase Sapphire Preferred®, Bank of America® Cash Rewards Credit Card, Wells Fargo Propel American Express® card, Ink Business Preferred, Ink Business Cash Card and Ink Business Cash Card has been collected independently by CreditCards.com and has not been reviewed by the issuer.


Comparing Rewards Credit Card Offers

Rewards credit cards have proliferated in recent years, with the best offers delivering cardholders hundreds, even thousands of dollars in rewards. It is not surprising that rewards cards claim several spots on our list of the overall best credit cards.

Cashback, points, miles – whichever method you choose, the results can be, well, rewarding. In fact, because it is accepted that merchants up their prices to accommodate their costs due to credit card fees, consumers who use cards for their purchases actually come out ahead by $240 a year, while consumers who don’t end up behind to the tune of $50, according to the Federal Reserve of Boston.

But rewards credit cards can be daunting to the newcomer. Which type do you choose? Which card is the best? How do you use one? At CreditCards.com, we crunched the numbers on over 1,600 different credit card offers using the criteria outlined below to pick the best rewards cards out there. Along with our top picks, we’ve also included some takes from other experts and supplemental information to help you with your decision. Here, we look at:


best rewards credit cards of 2020

Best rewards credit cards

Capital One® Venture® Rewards Credit Card

Why it’s the best rewards credit card for travel rewards

The Venture Rewards offers a terrific flat rate of 2X miles on every purchase, beating out most travel rewards cards and allowing you to rack up miles without worrying about tracking spending categories.

Pros

The sign-up bonus is one of the best: 50,000 miles after a $3,000 spend within the first 3 months and 2X miles on all purchases. You’ll also find value in the wealth of travel partners where you can transfer your miles. The Venture Rewards Credit Card is a fine choice for both domestic and foreign travel because of its versatility. Fly any airline and stay at any hotel – there are no blackout dates.

Cons

The annual fee isn’t waived in the first year. However, this is fairly common among travel credit cards of this caliber.

Chase Sapphire Preferred® Card

Why it’s the best rewards credit card for sign-up bonus

Earn 60,000 points after a $4,000 spend within the first 3 months of card membership; it’s worth $750 when redeemed for travel through Chase Ultimate Rewards.

Pros

In preparation for your upcoming travel, take a look at this card, with its partnerships with major airlines and hotel brands and the 2X points for spending on travel and restaurants. They’ve also added new, limited-time (now through 9/30/20) bonus categories that may help consumers who aren’t spending as much on air travel right now: 3X points on Instacart delivery and pickup orders (on up to $3,000), 3X points at gas stations (on up to $1,500) and 5X points on select streaming services (on up to $1,500).

Cons

One potential setback is the $95 annual fee. However, if you use this card often and redeem your reward points, you can easily make up the cost of the annual fee.

Capital One® Quicksilver® Cash Rewards Credit Card

Why it’s the best rewards credit card for cash rewards

The Quicksilver offers 1.5% back on all purchases, making it a champion of simplicity. For those who prefer not to strategize spending based on rewards categories, this is an easy choice.

Pros

Complementing the simple and lucrative ongoing rewards, the Quicksilver’s sign-up bonus offers a nice little boost of $150 after a $500 spend within the first 3 months – not the most competitive, but beneficial and easy to achieve. Also, this card has no foreign transaction fees.

Cons

The Citi Double Cash Card may have a greater lifetime value. Although that card doesn’t have a sign-up bonus, the flat rewards rate is better.

Discover it® Cash Back

Why it’s the best rewards credit card for rotating cash back categories

Check out Discover’s 2020 cash back calendar and you’ll see that the card offers a great mix of bonus spending categories, ranging from grocery stores and gas stations to restaurants and online shopping. And not only will you earn 5% cash back in these rotating categories (upon enrollment, on your first $1,500 in combined quarterly spending, then 1%), Discover will also match all the cash back you earn at the end of your first year.

Pros

You can earn rewards while you finance a larger purchase or pay down debt thanks to the Discover it Cash Back’s 0% introductory APR on both new purchases and balance transfers for the first 14 months (11.99% - 22.99% Variable after that). The card also charges no foreign transaction fee.

Cons

In order to earn the 5% cash back (on your first $1,500 in combined quarterly spending, then 1%), you must remember to enroll each quarter when the category changes. This can be a hassle for busy consumers or those who simply prefer to set and forget. Additionally, Discover credit cards are not accepted as widely as Visa or Mastercard credit cards. This is especially worth keeping in mind if you plan to travel internationally.

Blue Cash Preferred® Card from American Express

Why it’s the best rewards credit card for everyday purchases

This card’s 6% cash back U.S. supermarkets (on up to $6,000 in purchases per year, then 1%) and 3% back at U.S. gas stations and transit will benefit nearly every consumer.

Pros

The introductory bonus – $250 after spending $1,000 within the first 3 months – is easily achievable and will kick-start your rewards earnings.

Cons

Unlike other rewards cards with an annual fee, the Blue Cash Preferred’s annual fee of $95 isn’t waived the first year. If that’s a deal breaker, you might consider the Blue Cash Everyday®, which has similar categories but with no annual fee.

Southwest Rapid Rewards Plus Credit Card

Why it’s the best rewards credit card for airline rewards

The card comes with a solid sign-up bonus of 40,000 points when you spend $1,000 in the first 3 months. You’ll also enjoy an annual bonus of 3,000 points each year after your account anniversary.

Pros

You’ll earn 2 points per dollar on purchases made with Southwest and its hotel and car rental partners, plus 1 point per dollar on all other purchases. Combine this ongoing rate with the card’s annual bonus and you should be able to make up the $69 annual fee. If you’re a heavy spender, you may even earn enough points to qualify for the coveted Companion Pass. This can be a huge money-saver for those with families or partners.

Cons

The card’s travel perks aren’t particularly impressive: You won’t get any credits for an expedited airport security program or even a discount on in-flight purchases. Additionally, Southwest doesn’t have any airline transfer partners or much international reach, making it one of the least versatile travel rewards cards.

Wells Fargo Propel American Express® card

Why it’s the best rewards credit card for no annual fee

Few rewards cards offer such a competitive rewards rate and such comprehensive travel protections without charging an annual fee. Even better, there is no spend cap on the card’s 3X bonus categories, including dining, travel and transit, and select streaming services.

Pros

With no annual fee and no limits on rewards, this card is easy to love. There’s also the 20,000 points after a $1,000 spend within the first 3 months – that’s a $200 cash redemption value.

Cons

You’ll have to look hard for something not to like about this card. One potential drawback may be that there are no boosted rewards for groceries, one category that nearly everyone could benefit from earning rewards on.

Ink Business Unlimited℠ Credit Card

Why it’s the best rewards credit card for business cash back

It’s perfect for small-business owners who want to keep things simple. You’ll earn 1.5% cash back on every purchase, no matter where, when or what you buy. Redemption is a breeze, too: As long as your account remains open, your points never expire and you can redeem them for statement credits, direct deposits, travel rewards, gift cards and more.

Pros

Along with a sign-up bonus of $500 when you spend $3,000 in the first 3 months, you’ll enjoy a 0% introductory APR on new purchases for the first 12 months (13.24% – 19.24% variable APR after that). This could be a huge help if you need to finance a large business purchase or free up cash flow.

Cons

While 1.5% cash back is a solid rate for a card with no annual fee, other business cards can offer a higher rewards rate on general purchases or in specific, business-tailored spending categories. Even if these cards come with an annual fee, the rewards you’ll earn will usually be enough to make up for it.

Capital One® SavorOne® Cash Rewards Credit Card

Why it’s the best rewards credit card for dining and entertainment

The SavorOne’s rewards on dining and entertainment are supremely competitive, at 3% cash back for those categories.

Pros

In addition to the rewards on dining and entertainment, this card offers unlimited 2% cash back at grocery stores. Given the rewards this card offers, it’s rather remarkable that there is no annual fee.

Cons

While this is a strong no-annual-fee cash back card, it may not make sense for the ultra-frugal consumer. If you’re trying to cut back on eating out, as many people do when budgeting, you miss out on the card’s most lucrative rewards category. If you’d like to earn rewards for cooking meals at home, you can find better with the Blue Cash Everyday.

Capital One® VentureOne® Rewards Credit Card

Why it’s the best rewards credit card for flat rewards rate

With no annual fee, the VentureOne is a fine choice for the occasional traveler, in large part because you’ll earn a great flat rate of 1.25X miles on every purchase.

Pros

This card has a multitude of travel partners – more than 10 – which could allow you to transfer and stretch your miles even further. Options include Etihad Airways and Air France/KLM.

Cons

The sign-up bonus and the ongoing rewards are serviceable for an occasional traveler, but they both can be beaten by other cards, particularly ones with an annual fee. If you travel often, you’ll likely find more value in an annual fee card.

Bank of America® Cash Rewards credit card

Why it’s the best rewards credit card for customizable rewards

It’s perfect if your spending habits vary from month to month. You’ll earn 2% cash back at grocery stores and wholesale clubs, plus 3% cash back in a bonus category of your choice (on the first $2,500 you spend each quarter in 2% and 3% categories). Plus, you can switch your 3% bonus category once each calendar month – choose from gas, online shopping, dining, travel, drug stores, and home improvements and furnishings.

Pros

You’ll earn $200 in online cash rewards if you spend $1,000 in the first 90 days. Given this card’s practical everyday bonus spending categories, meeting that requirement should be no sweat. The card also comes with a 0% introductory APR for 15 billing cycles on new purchases (13.99% – 23.99% variable APR after that), making it a solid option if you need to finance a large purchase.

Cons

The 2% and 3% cash back categories are capped at $2,500 in combined spend each quarter. After that, you’ll earn just 1%.

Summary of the Best Credit Cards for Rewards

Credit Card Best For: Rewards Rate Annual Fee Creditcards.com Review
Ink Business Unlimited℠ Credit Card Business cash back 1.5% cash back on every purchase $0 3.5 / 5
Bank of America® Cash Rewards credit card Customizable rewards 3% cash back on a category of choice 2% cash back on groceries and wholesale club purchases ($2,500 combined limit on 2% and 3% categories each quarter ), 1% cash back on other purchases $0 3.4 / 5
Wells Fargo Propel American Express® card No annual fee 3X points for: Eating out, ordering in, gas stations, rideshares, transit, flights, hotels, homestays, and car rentals 1X points on other purchases $0 3.5 / 5
Capital One® SavorOne® Cash Rewards Credit Card Dining and entertainment 3% cash back on dining and entertainment $0 3.7 / 5
Southwest Rapid Rewards Plus Credit Card Airline rewards 2X points on Southwest purchases $69 3.7 / 5
Capital One® Venture® Rewards Credit Card Travel rewards 2X miles on every purchase $95 4.2 / 5
Capital One® VentureOne® Rewards Credit Card Flat rate rewards 1.25X miles on every purchase $0 3.5 / 5
Discover it® Cash Back Rotating category rewards 5% cash back in rotating categories Up to $1,500 in purchases quarterly and unlimited 1% cash back on everything else. Activation required. $0 4.5 / 5
Capital One® Quicksilver® Cash Rewards Credit Card Cash rewards 1.5% cash back on every purchase $0 3.4 / 5
Chase Sapphire Preferred® Card Sign-up bonus 2X points on travel and dining 1 point per dollar on everything else $95 3.9 / 5

Research methodology

We analyzed over 1,600 rewards credit cards and most heavily weighed 9 factors to identify the best cards for your lifestyle – these factors and more inform our decisions in which cards can work the hardest for you. Here’s a glimpse at how we evaluated several criteria.

Rewards rate

Of course, we made sure to choose credit cards with the highest rewards rates in the most lucrative categories. We took into account earning caps, rotating categories and other fine print that may affect total earnings potential.

Interest rate

One common feature that cuts into a rewards card’s value is a high interest rate. Though it’s always ideal to pay in full each month, we understand that sometimes it may be necessary. For this reason, we excluded rewards cards with exorbitant interest rates.

Fees

An annual fee is another feature that may undercut a card’s value. We compared each card’s fees to the rewards rate and sign-up bonus to determine whether the average consumer could earn enough rewards to justify the annual fee within the first year and years to come. For example, someone with a flat 2% cash back card would have to spend $5,000 to earn $100 in rewards cash, which is a common annual fee price. Keep in mind that a sign-up bonus may make it easier to make up for the annual fee in the first year.

Travel benefits: transfer partners, point value

For travel enthusiasts, it’s all about the points and miles. Since there are numerous travel loyalty programs, it can be difficult to know where you can find the most value. That’s where our experts come in. We’ve assessed point values and transfer partners to help you weigh your options based on your lifestyle and goals.

All criteria used: Credit needed, rates & fees, transfer partners, travel benefits, point values, redemption options and flexibility, customer service, sign-up bonus, rewards rate.

What are rewards credit cards?

A rewards credit card is a lending product that gives you points, miles or cash back for your spending. You might get rewards for specific categories, or you might get a flat rate for all expenditures.

In our April 2019 poll of what’s on consumers’ credit card wish lists, we found that consumers’ favorite card features were by far that of cash back – in fact, consumers wanted 3% back on all purchases, something that might have once been considered extremely unlikely. Sign-up bonuses, a common feature of rewards cards, were also in the top 5. In another recent study, we found that rewards are the favorite use for consumers’ most used cards, at 40%.
When you are shopping for a rewards card, you see that they vary widely in whether they have an annual fee, a sign-up bonus and what kinds of ongoing rewards they have. So, while most cash back cards have no annual fee, many travel cards do. And while you will be hard-pressed to find a cash back card with extensive travel benefits, travel cards will likely have them in abundance.

What are the different types of reward cards?

There are a number of different types of rewards credit cards, the two primary being cash back and travel cards. Both of these rewards cards, when used responsibly and correctly, can help you gain rewards through the everyday purchases you make or the flights you’re already booking. Although this sounds simple enough, it can be confusing when trying to find the right card for you because there are so many to choose from. In fact, more than 60% of credit cards issued in the U.S are tied to a rewards program, according to The Wall Street Journal. So to make it a little easier for you, we’ve gone into detail about the different types of rewards credit cards and what they can offer you:

Cash back cards

Originating in 1986, Discover developed its products as a way to give money back at the end of the year based on the amount of charges. Since then, the cash back product has expanded to cards that give cash back in statement credits, checks and deposits in bank accounts. This can be a great way to earn money for the purchases you make every day, and with the right card, the rewards won’t expire for the life of the account – so the rewards that you earn will always be yours.

There are several types of cash back credit cards:

  • Flat-rate cash back cards are the simplest type of rewards cards, offering a standard percent cash back on all purchases, usually between 1% and 2%.
  • Tiered cash back cards reward certain spending categories at a higher rate. For example, the Capital One® Savor® Cash Rewards Credit Card offers 4% cash back on dining and entertainment purchases, 2% cash back at grocery stores and 1% on all other purchases. For those who typically spend a lot in one category, a tiered cash back card can be a great way to maximize your rewards earnings.
  • Rotating category cash back cards are similar to tiered cards in that they offer boosted rewards in certain categories. However, the bonus categories change, usually each quarter, and are often seasonally relevant. For example, the Discover it® Cash Back card is offering 5% cash back on Amazon.com, Walmart.com and Target.com purchases in October – December 2020 on up to $1,500 in purchases quarterly after activating (then 1%), right on time for holiday gift purchases.

Travel rewards credit cards

Travel credit cards reward cardholders with points or miles instead of cash. You can redeem these to book travel, and with some travel rewards cards, you’ll gain access to luxurious perks like airport lounge access. There are three main types of travel credit cards.

Types of travel rewards credit cards

  • General-purpose travel credit cards reward cardholders with points, which can be redeemed for flights or hotel stays. General-purpose cards are the most flexible type of travel credit card because they allow you to redeem with a variety of partner brands, so you’re not tied to one airline or hotel chain. Also, many general-purpose travel credit cards reward you with an extra boost in your points if you redeem through the issuer-specific portal redemption portal, rather than transferring your points to an airline or hotel loyalty program.
  • Airline credit cards reward cardholders with miles for a specific airline, like Delta or United. You earn those miles at a boosted rate through spending on flights or other categories, such as gas stations or dining. If you’re loyal to one brand, you’ll likely find your best redemption value with an airline card instead of a general-purpose card.
  • Hotel credit cards, like airline cards, are also co-branded and encourage loyalty to a single brand. As rewards stack up, you can earn free nights and become eligible for room upgrades, free breakfast, and status boosts.

Other rewards cards

  • Gas: Also called fuel cards, this product dates back to the 1920s when the primary purpose was convenience. With the advent of rewards cards that also reward you for groceries, wholesale clubs and restaurants, rewards cards have all but replaced the gas credit card. That said, gas cards can reward you generously for each gallon and sometimes only require fair credit. If you’re on the road a lot, this might be a good choice.
  • Retail: Sometimes called co-branded cards, this product is a type of loyalty card that is tied to department stores or other store brands. These cards can offer high percentages of cash back for first purchases and more.
  • Business: Many card issuers offer varying types of rewards cards, frequently with greater rewards than consumer rewards cards. You can get cash back or points for business-related spending, such as the Ink Business Unlimited℠ Credit Card. If you often spend on business items, a business card might be an option.
  • Credit-builder: Sometimes cards for fair credit and even secured cards offer rewards, typically 1% back on purchases, such as the Credit One Bank® Visa® Credit Card.

Are rewards credit cards worth it?

Credit card rewards can be a way to earn lucrative cash back bonuses and benefits. And depending on your rewards card, you can also earn cash back for things that you’re buying every day.

In order to truly maximize your rewards, you’ll need to stay on top of your points, miles, or cash back earned. While there may be a small learning curve, free flights, hotel stays and cash back in your pocket are certainly worth the time.

If you don’t have the time or desire to strategize your spending, a flat-rate rewards card is an easy and valuable option as well. One thing that can detract from or even outweigh your rewards value is carrying a balance from month to month. If you spend within your means and pay off your balance each month, a rewards card can easily be worth your while.

Here, we look at the pros and cons of rewards credit cards to help you decide if they are right for you.

Pros

  1. Accrue points, miles or cash: Earn hundreds of dollars a year in points, miles or cash back. It doesn’t get better than this.
  2. Travel and shopping perks: Rewards cards can offer extended warranties, rental car insurance and other travel and shopping benefits.
  3. Build credit: As with most credit cards, this is a great way to build your credit, provided you pay on time each month.
  4. Fees waived: In the case of the best travel credit cards, many have no foreign transaction fees and may even waive the annual fee the first year. With some cash back cards, you may not pay an annual fee at all.

Cons

  1. Higher credit score required: While there are credit-builder cards that have rewards, the cards with richer offers tend to require higher credit scores. Make sure you check the required score of a card before applying.
  2. They can cost you time: Many rewards cards can require you to spend some time maximizing points or cash. For example, if it’s a card with rotating categories, you need to sign up for categories, then make sure you maximize spend without going over budget. And some travel cards have blackout dates and limit your choice in travel partners. However, there are rewards cards with flat rates if you don’t want to invest time in your rewards.
  3. Damage credit/budget: While you can improve your score with each month of on-time payments, you can destroy it with high balances. Also, you can blow your budget if you don’t pay attention to your spending, as well as undo any earnings you’ve made through rewards.
  4. Higher interest rates: Interest rates on rewards cards tend to be higher, particularly travel cards. But if you plan to pay in full each month, that shouldn’t be a problem. In our October 2018 rewards survey, only 41% of consumers said they pay off their rewards card each month.

Are rewards cards with annual fees worth it?

As you do your research, you may start to notice that the cards with the best rewards earnings and benefits usually charge an annual fee, especially travel rewards cards. Is paying the annual fee worth it?

The answer depends on how much you’re going to spend on the card, especially within the bonus categories. For cash back cards, it can be as simple as doing a quick calculation. The Blue Cash Preferred® offers 6% cash back at U.S. supermarkets on up to $6,000 in purchases per year, then 1%. At the 6% rewards rate, you’d have to spend $1,584 on groceries for the year to earn $95 in rewards cash and make up for the annual fee. For even the most frugal shoppers, this is likely achievable. Plus, Blue Cash Preferred has other bonus categories to help you earn.

With travel cards, it may be a bit more difficult to calculate value, since rewards come in the form of points or miles, rather than cash back. You’ll want to do your research to determine how far you can stretch your points with that card’s particular loyalty program. The Points Guy’s monthly point valuations take some of the heavy lifting out of this research so that you can compare loyalty programs apples-to-apples. Sign-up bonuses can easily outweigh the cost of an annual fee, too, though only for the first year.

You’ll also want to consider other factors aside from rewards earnings. Maybe you determine that you’ll just break even between rewards earnings and the annual fee. Consider the additional perks the card offers. Maybe the benefit of airport lounge access, free checked bags or a TSA PreCheck or Global Entry credit is where you find the most value.

Whether the annual fee will be worth it depends on your spending habits, so it’s important to be honest with yourself and choose a card that matches how you already spend or plan to spend. If you aren’t sure, many issuers allow the option to upgrade a card in the future, so you can always start with the no annual fee version and trade up later.

How do you maximize credit card rewards?

To take full advantage of your points, you need to look at the rewards card from all angles, including how much you’ll spend and what you’ll buy. Here’s a quick guide on how to maximize your points:

  1. Calculate: Calculate how much you’ll spend, making sure you will at least recoup the annual fee.
  2. Take advantage of the sign-up bonus: Make sure that you will be able to spend the required amount within the required time for the sign-up bonus, but avoid the temptation of making extra purchases just for the sake of reaching the required spend. Stick to sign-up bonuses that you know are attainable from your regular or pre-planned purchases.
  3. Make it your go-to card: See if you can pay your rent, insurance and utilities with it, but make sure there are no convenience fees. Buy your groceries with it, and pull it out at restaurants.
  4. Pay in full and pay on time: If you can’t pay it off in full each month, there’s no point in acquiring it. The interest fees will overshadow any cash back or points you’ve earned. Never go over the limit or pay late; these are wasted dollars.
  5. Use shopping portals: Frequently check for deals. Just make sure you are fully rewarded for using points or miles. Some cards don’t reward you for the full amount with their shopping portals or gift cards.
  6. Take full advantage of the benefits: Make full use of the benefits, such as price protection and auto rental insurance.
  7. Consider multiple cards: Having multiple credit cards can be a great way to maximize your hard-earned rewards, especially if you have a hotel or an airline card. Since cards such as these two are used primarily for booking rooms or flights, it may be useful to have a cash back card or a luxury rewards card as well to bolster your earnings. For example, partnering the Wells Fargo Propel American Express® card with the Chase Sapphire Preferred® card could boost your earnings through expanding your rewards categories.

Creditcards.com’s analysis: How much can you earn in rewards?

In some cases, there is no cap on how many points or cash back you can earn with a rewards credit card. In other cases, you are limited to how much you can earn with specific categories.

When we looked at our 20 most popular rewards credit cards, we found that there were no caps on spending for specific categories on 9 cards, with the highest at 5X points – The Platinum Card® from American Express offers 5X points on amextravel.com and airfare purchased directly from airlines, while the Chase Sapphire Preferred currently offers 5X points with Lyft through March 2022.

When looking at unlimited categories and unlimited spending, that number went down to only 7 – 3 are travel cards and 4 are cash back cards. Of the cash back cards, Citi® Double Cash pays out 2% on all qualifying purchases – 1% cash back when you purchase and 1% cash back when you pay for the purchase.

In terms of your welcome offer, we found that rewards cards with points or miles ranged from 15,000 points (Citi Rewards+℠ Card, after a $1,000 spend within the first 3 months) to 60,000 points (Chase Sapphire Preferred, after a $4,000 spend within the first 3 months; and Platinum from Amex, after a $5,000 spend within the first 3 months).

When looking at cash back cards, we discovered that Savor was the highest, with $300 cash back after a $3,000 spend within the first 3 months.

Comparing the top rewards cards by category

Rewards Category Top Offer Highest Average Lowest
Welcome bonus
Points
Chase Sapphire Preferred
Chase Sapphire Preferred
60,000 points 40,625 points 15,000 points
Unlimited cash back
All spending categories
Citi Double Cash
Citi Double Cash
2% 1.625% 1.5%
Welcome bonus
Cash back
Capital One Savor Cash Rewards $300 $183.33 $150
Unlimited points or miles
All spending categories
Capital One Venture Rewards 2X miles 1.58X points or miles 1.25X miles

The best credit card rewards programs

Credit card rewards programs come in any number of flavors, and one of them is bound to work well for you.

There’s Chase Ultimate Rewards, with generous rewards for your loyalty. And what about American Express Membership Rewards? Then, there are popular hotel rewards plans.

Here are some popular rewards programs and how they work.

Chase Ultimate Rewards

Chase Ultimate Rewards is a travel portal that can pack points into your account if used correctly. There are 2 types of Ultimate Reward cards, a total of 6 cards:

  • Cards with annual fees – Chase Sapphire Preferred and Reserve and Ink Business Preferred boost your Ultimate Rewards redemption value by 25% or 50%, depending on the card, when you use the points toward travel in the portal.
  • Cards without annual fees – You can use the Chase Freedom Flex, the Freedom Unlimited and the Ink Business Cash to collect points to be used on the Ultimate Reward portal. One benefit: You can transfer the points on these cards to the cards with annual fees and enjoy the boosted bonus of the superior card.

Earn points through worldwide travel and dining, business categories, rotating categories such as gas and groceries, and more. With the Ultimate Rewards portal, you can book all types of travel with partner brands, including air travel and cruises, or enjoy redemptions for such items as gift cards and merchandise.

American Express Membership Rewards

Myriad Amex cards use the Membership Rewards program, including the American Express® Gold Card and the Blue Business Plus.

You can earn Membership Rewards through eligible airfare, hotel stays, car rentals, retail purchases and more. There are also opportunities with eligible business purchases in the U.S., such as office supplies, wireless service, shipping, advertising and computer hardware/software/cloud computing. Membership Rewards points can be used toward a shopping portal for such brands as Amazon.com and Staples. You can also use your points to cover card charges or for gift cards. One of the most popular uses is as a travel portal. You can enjoy more value when you transfer the Membership Rewards points to miles and redeem them for international flights in business or first class. You can also experience bonus points for transfers with American Express’ airline partners.

Hilton Honors

With the Hilton portfolio, which includes such brands as Waldorf Astoria, Homewood Suites and Curio, you have access to 5,000 hotels and resorts around the world. Add to that, you can experience the benefits of the Hilton Honors program, which gives you access to these properties through the points you have collected with purchases.

In addition to earning points at member properties, earn points through partners for car rentals, cruises, even mobile roaming while abroad. You can use the points as a gift by purchasing gift cards at Hilton locations or treat yourself with a weekend at a favorite spot. Also enjoy using the points toward flights and rail travel, vehicle upgrades and more.

Citi ThankYou Points

The Citi ThankYou program, Citi’s points earning and redemption program, is offered through a handful of Citi cards, with options to redeem through merchandise, travel, gift cards, electronics and more, depending on the card.

Depending on the product, you might earn 1.25X points for booking travel in the same way that some Chase cards are structured. The program includes about 15 airline partners, which compares well to the Chase and American Express partnerships.

Wells Fargo Go Far Rewards

There are basically 2 ways to earn Go Far Rewards – by spending on your Wells Fargo credit card or by shopping on the Earn More Mall site.

Unlike Chase and American Express, Go Far Rewards can’t be transferred to an airline partner. However, redemptions can come in a number of ways, such as cash back, statement credits, travel, gift cards, merchandise, digital downloads and even as a gift. There’s a Go Far Rewards online auction that you can use to bid on merchandise using your points.

Bank of America Preferred Rewards

The Bank of America Preferred Rewards program works a little differently from the other bank card issuer programs in that it rewards you for how much you keep in your Bank of America bank accounts. This includes funds in Merrill.

The card rewards benefits can be considerable – if you keep at least $20,000 in your accounts, you’ll earn a 25% bonus on qualified card rewards, and that goes up to 75% when you have at least $100,000 in your accounts. There are other bank-related benefits as well, such as money market savings interest rate boosters and auto loan interest rate discounts.

How to redeem your credit card rewards

Whether you are earning points, miles or cash back, card issuers offer numerous ways to redeem those rewards. You can redeem through statement credits, gift cards, even checks. Here are some ways:

  • A portal for travel purchases. With some cards such as the Chase Sapphire Preferred and Reserve, a travel portal can be used to make purchases using points, with additional rewards for using the portal.
  • A portal for redemption. With general-purpose travel cards, you can redeem your miles for all manner of travel through a portal that monitors your rewards and travel spending.
  • Redeeming for specific brands. With hotel- and airline-branded cards, you can redeem for those specific brands and sometimes their partners.
  • Online shopping. Redeem your points through a shopping portal for such items as clothing, health and beauty aids, gift cards, and more.
  • Get a check. A few card issuers will issue a check for your cash rewards.
  • Deposit into bank account. This is a great option for Bank of America Preferred Rewards clients.
  • Statement credit. A favorite among cashback cards, you can earn your redemption through a credit that is placed on your card statement.

Rewards card ownership statistics

How many “active” credit cards do you currently hold?…

  • 1 card
  • 17%
  • 2 cards
  • 15%
  • 3 or more cards
  • 33%
  • I don’t hold this type of card
  • 26%
  • Source: CreditCards.com 2018 rewards card survey

Consumers with at least 1 rewards card that has…

  • No annual fee
  • 72%
  • An annual fee of up to $75
  • 25%
  • An annual fee between $76-$150
  • 15%
  • An annual fee of at least $151
  • 10%
  • Unsure
  • 15%
  • Source: CreditCards.com 2018 rewards card survey