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

|

December 1, 2020

Best Rewards Credit Cards

Bank of America® Cash Rewards credit card

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 3% cash back in the category of your choice (up to $2,500 in combined choice category/grocery store/wholesale club quarterly purchases)
2%
Earn automatic 2% at grocery stores and wholesale clubs (up to $2,500 in combined choice category/grocery store/wholesale club quarterly purchases)
1%
Earn unlimited 1% on all other purchases.

At A Glance

Intro Bonus
$200

$200 online cash rewards bonus after you make at least $1,000 in purchases in the first 90 days of account opening

Annual Fee
$0
Regular APR
13.99% - 23.99% Variable APR on purchases and balance transfers
Blue Cash Everyday® Card from American Express

Best Blue Cash Everyday Offer

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

3%
3% Cash Back at U.S. supermarkets (on up to $6,000 per year in purchases, then 1%).
2%
2% Cash Back at U.S. gas stations and at select U.S. department stores.
1%
1% Cash Back on other purchases.

At A Glance

Intro Bonus
Up to $300

Earn 20% back on purchases at Amazon.com on the Card in the first 6 months, up to $200 back. Plus, earn $100 back after you spend $1,000 in purchases on your new Card within the first 6 months.

Annual Fee
$0
Regular APR
13.99% - 23.99% variable
Capital One Quicksilver Cash Rewards Credit Card

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

1.5%
Earn unlimited 1.5% cash back on every purchase, every day

At A Glance

Intro Bonus
$200

One-time $200 cash bonus after you spend $500 on purchases within 3 months from account opening

Annual Fee
$0
Regular APR
15.49% - 25.49% variable
Chase Freedom Unlimited®

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% on travel purchased through Chase.
3%
Earn 3% on dining at restaurants and drugstores
1.5
Earn unlimited 1.5% cash back 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
Capital One Venture Rewards Credit Card

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
Earn unlimited 2X miles on every purchase, every day.

At A Glance

Intro Bonus
100,000 miles

Ends December 14, 2020: Earn 100,000 bonus miles when you spend $20,000 on purchases in the first 12 months from account opening, or still earn 50,000 miles if you spend $3,000 on purchases in the first 3 months

Annual Fee
$95
Regular APR
17.24% - 24.49% variable
Alliant Visa® Platinum Rewards Credit Card

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
Earn two reward points for every dollar spent

At A Glance

Intro Bonus
No current offer
Annual Fee
$0
Regular APR
13.24% - 23.24% variable
Discover it® Cash Back

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 everyday purchases at different places each quarter like Amazon.com, grocery stores, restaurants, gas stations and when you pay using PayPal, up to the quarterly maximum when you activate.
1%
Plus, earn unlimited 1% cash back on all other purchases – automatically.

At A Glance

Intro Bonus
Cashback Match™

Intro Offer: Unlimited Cashback Match - only from Discover. Discover will automatically match all the cash back you've earned at the end of your first year! There's no minimum spending or maximum rewards. You could turn $150 cash back into $300.

Annual Fee
$0
Regular APR
11.99% - 22.99% variable
The Platinum Card® from American Express
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

10X
Earn 10x points on eligible purchases on your new Card at U.S. Gas Stations and U.S. Supermarkets, on up to $15,000 in combined purchases, during your first 6 months of Card Membership. That’s an additional 9 points on top of the 1 point you earn for these purchases.
5X
Earn 5X Membership Rewards® Points for flights booked directly with airlines or with American Express Travel. Starting January 1, 2021, earn 5X points on up to $500,000 on these purchases per calendar year.
5X
5X Membership Rewards® Points on prepaid hotels booked on amextravel.com.

At A Glance

Intro Bonus
75,000 points

Earn 75,000 Membership Rewards® Points after you spend $5,000 on purchases on your new Card in your first 6 months of Card Membership.

Annual Fee
$550
Regular APR
See Pay Over Time APR
Chase Freedom Flex℠

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
Capital One SavorOne Cash Rewards Credit Card

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
$200

Earn a one-time $200 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
Citi Rewards+℠ Card

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

2X
Earn 2X ThankYou® Points at Supermarkets and Gas Stations for the first $6,000 per year and then 1X Points thereafter.
1X
Earn 1X ThankYou® Points on All Other Purchases.

At A Glance

Intro Bonus
15,000 points

Earn 15,000 bonus points after you spend $1,000 in purchases with your card within 3 months of account opening; redeemable for $150 in gift cards at thankyou.com

Annual Fee
$0
Regular APR
13.49% - 23.49% (Variable)
Capital One VentureOne Rewards Credit Card

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 $500 on purchases within 3 months from account opening, equal to $200 in travel

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

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, Chase Sapphire Preferred®, and Wells Fargo Propel American Express® 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

Blue Cash Preferred® Card from American Express

Our pick for U.S. supermarkets

This card’s 6% cash back at 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. Plus, it isn’t difficult to achieve the limited-time introductory bonus – $300 after spending $3,000 within the first 6 months (offer ends 12/10/20). If the annual fee of $95 gives you pause, know that it’s waived for the first year (offer ends 12/10/20). You can also check out its little sister card, the Blue Cash Everyday® Card from American Express. If you’re not sure which card makes the most sense for you, check out our side-by-side comparison of the Blue Cash Everyday and Blue Cash Preferred.
Read the full review.

Bank of America® Cash Rewards credit card

Our pick for flexible cash back categories

This cash back card offers something truly unique: you get to pick and change your bonus cash back category as often as once per calendar month. You can choose from gas, dining, travel, online shopping, drug stores and home improvement/furnishings. With this freedom, you’re able to maximize your rewards by selecting your categories according to the purchases that are on your horizon. In addition to 3% cash back in your category of choice, you’ll also earn 2% cash back at grocery stores and wholesale clubs (you’ll earn 3% and 2% cash back on the first $2,500 in combined choice category/grocery store/wholesale club purchases each quarter. After that it’s 1%).

Read the full review.

Blue Cash Everyday® Card from American Express

Our pick for low interest

In most cases, you should only get a rewards credit card if you know you’re able to pay off your bill in full each month. But even if you’re pretty sure that’s the case, it’s good to have a card that charges a reasonable interest rate just in case that you do end up carrying a balance. The Blue Cash Everyday offers just that, with an APR of 13.99% – 23.99% variable. There’s plenty to love about the rewards system, too. Cardholders earn 3% cash back at U.S. supermarkets (up to $6,000 per year in purchases, then 1%) and 2% cash back at U.S. gas stations and at select U.S. department stores.
Read the full review.

Capital One Quicksilver Cash Rewards Credit Card

Our pick for intro APR period on purchases

With the Quicksilver, you can get 0% intro APR for 15 months on purchases (then it’s 15.49%-25.49% variable). That means if you have a pending renovation or major appliance purchase, the Quicksilver can help you pay strategically. However, you should remember that this only applies to purchases made with the card; there is no 0% intro APR offer for balance transfers. Your first few months are made even more valuable by the welcome bonus, $200 after you spend just $500 within the first 3 months. Aside from the new cardholder benefits, the ongoing value is good, too. You’ll earn 1.5% cash back on all purchases – no need to keep track of bonus categories.
Read the full review.

Chase Freedom Unlimited®

Our pick for cash back at drugstores

If you’re looking for a card that rewards everyday expenses, you’ll see several cards that offer rewards for grocery store and gas station purchases. But the Chase Freedom Unlimited® is unique because it offers 3% cash back on drugstore purchases, a somewhat rare category. It doesn’t end there; there are ample opportunities to earn rewards. In addition to the rewards you’ll earn at drugstores, you also have the opportunity to earn 3% cash back on dining at restaurants, including takeout and eligible delivery services, and 5% cash back on all travel purchased through Chase Ultimate Rewards®. All other purchases earn 1.5% cash back. With so many rewards categories, it’s pretty amazing that there’s no annual fee.
Read the full review.

Capital One Venture Rewards Credit Card

Our pick for travel rewards

There’s a reason the Venture card is revered by travel enthusiasts; with an excellent rate of 2X miles on every purchase, the Venture Rewards Card allows you to rack up miles without worrying about spending categories. Additionally, the sign-up bonus is one of the best: 100,000 miles after a $20,000 spend within the first 12 months or 50,000 miles after a $3,000 spend within the first 3 months. Lastly, but certainly not to be overlooked, is the Venture’s redemption flexibility. In addition to the wealth of transfer partners, there are no blackout dates.
Read the full review.

Discover it® Cash Back

Our pick for rotating cash back categories

This card offers a great mix of bonus spending categories, which you can find on Discover’s 2020 cash back calendar. You’ll earn 5% cash back in these rotating categories (upon enrollment, on your first $1,500 in combined quarterly spending, then 1%). While that rate is lucrative enough to stand on its own, Discover sweetens the deal by matching all the cash back you earn at the end of your first year. One potential drawback for those who prefer to set and forget: You must remember to enroll each quarter when the bonus category changes if you want to earn the boosted cash back rate.
Read the full review.

The Platinum Card® from American Express

Our pick for luxury travel benefits

The first thing you might notice about this card is the startling $550 annual fee. But for frequent travelers, especially those who like to travel in style, the long list of rewards, benefits and credits can easily make up that value. To start, flights booked directly with airlines or with American Express Travel earn 5X points. The same rate applies to hotels booked on amextravel.com. Starting January 1, 2021, earn 5X points on up to $500,000 on flights per calendar year.

Cardholders also have access to a wealth of annual credits: up to $200 in Uber credit, up to $100 Saks Fifth Avenue credit (enrollment required) and up to a $100 hotel credit. Every four years, cardholders get a $100 Global Entry or $85 TSA PreCheck® credit.

Read the full review.

Chase Freedom Flex℠

Our pick for combining rotating cash back and flat-rate spending

Indecisive? The Chase Freedom Flex gives you the best of both worlds when it comes to cash back. Earn 5% cash back on quarterly categories for up to a combined $1,500, then earn a flat rate of 5% on travel purchases made through Chase and 3% cash back at restaurants and drug stores. There are also a few first-year bonuses with this card. First, you earn 5% cash back at grocery stores (except Walmart® and Target®) up to $12,000 spent in your first year. The Freedom Flex also offers $200 to those who spend $500 within the first 3 months.
Read the full review.

Capital One SavorOne Cash Rewards Credit Card

Our pick for dining and entertainment

The SavorOne’s 3% cash back on dining and entertainment is highly competitive, especially for a no annual fee card. You’ll also earn 2% cash back at grocery stores, a nice touch of practicality to complement the dining and entertainment categories. 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 higher rewards rates with the Blue Cash Everyday.
Read the full review.

Citi Rewards+℠ Card

Our pick for everyday purchases

If you’re looking for a practical card that rewards everyday purchases, the Citi Rewards+ Card is a great choice. Cardholders enjoy 2X points at supermarkets and gas stations on the first $6,000 each year (then 1X points). This is also a good card for someone with a large purchase on the horizon or someone who wants to pay down existing debt, offering 0% intro APR for 15 months on purchases and balance transfers (then 13.49%-23.49% variable). With all of that and no annual fee, this card is certainly worth a second look.
Read the full review.

Capital One VentureOne Rewards Credit Card

Our pick for flat rewards rate

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. Plus, you’ll get the same 10+ travel partners as you would with the Capital One Venture Rewards Card. Options include Etihad Airways and Air France/KLM. The sign-up bonus and the ongoing rewards are good 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.
Read the full review.

Discover it® Miles

Our pick for starter travel card

For starters, this card makes earning miles simple, rewarding all purchases with 1.5 miles per dollar spent. There are no blackout dates, and you can pay for all manner of travel (and more) with your card. There’s a unique twist to this and some other Discover cards – your miles earned are matched at the end of your first year. That means if you earn 35,000 miles, that becomes 70,000 miles at the end of your first year. While this is a great bonus, some people won’t like waiting until the end of the first year for the Discover Match reward. One final consideration is that Discover cards may not be the best option for overseas travel because they aren’t widely accepted abroad.
Read the full review.

Chase Sapphire Preferred® Card

Our pick for sign-up bonus

New cardholders earn an enviable 60,000 points after a $4,000 spend within the first 3 months of card membership, which is worth $750 when redeemed for travel through Chase Ultimate Rewards. In terms of ongoing value, it’s hard to beat 2X points for spending on travel and restaurants plus partnerships with major airlines and hotel brands. 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.
Read the full review.

Summary of the Best Credit Cards for Rewards

Credit CardBest For:Rewards RateAnnual FeeCreditcards.com Review
Blue Cash Preferred® Card from American ExpressEveryday purchases6% cash back at U.S. supermarkets (up to $6,000 in purchases per year, then 1%), 6% cash back on select U.S. streaming subscriptions, 3% cash back at U.S. gas stations and on transit, 1% cash back on general purchases Limited Time Offer: $0 introductory annual fee for one year, then $95. Offer Expires 12/10/20204.3 / 5
Capital One Quicksilver Cash Rewards Credit CardCash rewards1.5% cash back on every purchase$03.4 / 5
Blue Cash Everyday® Card from American ExpressEveryday purchases3% cash back at U.S. supermarkets (up to $6,000 in purchases per year, then 1%), 2% cash back on U.S. gas stations, 1% cash back on other purchases $03.3 / 5
Capital One Venture Rewards Credit CardTravel rewards2X miles on every purchase$954.2 / 5
Capital One SavorOne Cash Rewards Credit CardDining and entertainment3% cash back on dining and entertainment 2% cash back on groceries, 1% cash back on other purchases $03.7 / 5
Discover it® Cash BackRotating category rewards5% cash back in rotating categories Up to $1,500 in purchases quarterly and unlimited 1% cash back on everything else. Activation required. $04.5 / 5
Chase Freedom Unlimited®Cash back at drugstores5% cash back on travel purchased through Chase Ultimate Rewards Not including Target® or Walmart® purchases; up to $12,000 spent in the first year. $04.7 / 5
Capital One VentureOne Rewards Credit CardFlat rate rewards1.25X miles on every purchase$03.5 / 5
Chase Freedom Flex℠Rotating categories & flat-rate combo5% cash back on travel purchased through Chase Ultimate Rewards$03.9 / 5
Citi Rewards+℠ CardEveryday purchases2 ThankYou points per dollar at supermarkets and gas stations (up to $6,000 per year in purchases, then 1 point per dollar) 1 ThankYou point per dollar on all other purchases $03.0 / 5
Discover it® MilesStarter card for travel rewards1.5 miles per dollar on general purchases$04.0 / 5
Chase Sapphire Preferred® CardSign-up bonus2X points on travel and dining 1 point per dollar on everything else $953.9 / 5
Southwest Rapid Rewards® Plus Credit CardAirline rewards5X points on Southwest purchases Earn between 12/1/2020 and 3/31/2021 on up to $2,000 spent per month $693.7 / 5
Wells Fargo Propel American Express® cardNo annual fee3X points for: Eating out, ordering in, gas stations, rideshares, transit, flights, hotels, homestays, and car rentals 1X points on other purchases $03.5 / 5
Ink Business Unlimited® Credit CardBusiness cash back1.5% cash back on every purchase$03.5 / 5
Bank of America® Cash Rewards credit cardCustomizable rewards3% 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 $03.4 / 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 and how do they work?

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 were the favorite use for consumers’ most used cards, at 40%.

What determines which purchases qualify for bonus rewards?

Say your credit card offers 3% cash back at restaurants. You might wonder what qualifies as a restaurant. Do breweries, food trucks and fast food chains count? Knowing exactly what kind of purchases qualify for your card’s bonus rewards will help you maximize your earnings.

The answer lies in the merchant category code. Payment networks like Visa and Mastercard assign merchants a code that categorizes the type of business it is. Because each payment network assigns an MCC, one business may have several MCC’s between the major payment networks. You can find a business’s merchant category code online with Visa’s supplier locator tool. Unfortunately, Mastercard and American Express do not offer similar tools.

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 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. 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

Cash back credit cards reward cardholders for their purchases with statement credits, checks and bank account deposits. 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%. A great option: the Citi® Double Cash Card, which essentially offers 2% cash back on all purchases excluding gift cards, (1% as you buy, 1% as you pay off your purchases).
  • Tiered cash back cards reward certain spending categories at a higher rate. A great option: the Capital One Savor Cash Rewards Credit Card, which offers 4% cash back on dining and entertainment purchases, 2% cash back at grocery stores and 1% on all other purchases.
  • 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. A great option: the Discover it® Cash Back card, which is offering 5% cash back on Amazon.com, Walmart.com and Target.com purchases from October through December 2020 on up to $1,500 in purchases quarterly after activating (then 1%), right on time for holiday gift purchases. Quarterly sign-up required.

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. A great option: the Chase Sapphire Preferred Card, which rewards cardholders with 2X points at travel and restaurants.
  • Airline credit cards reward cardholders with miles for a specific airline. 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. A great option: the Delta Skymiles® Gold American Express Card, which offers 2X miles on Delta purchases, at restaurants worldwide and at U.S. supermarkets.
  • 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. A great option: the Hilton Honors American Express Surpass® Card.

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. A great option: the Wells Fargo Propel American Express® card.
  • Retail: Sometimes called a co-branded card, 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. A great option: the Amazon Prime Rewards Visa Signature card, which offers rewards on Amazon Prime and Whole Foods purchases.
  • 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. A great option: the Ink Business Unlimited® Credit Card, which rewards cardholders with 1.5% cash back on all purchases. 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. A great option: 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. For this example, we’ll assess the value of the Blue Cash Preferred® Card from American Express for someone who spends $2,400 each year on gas and $4,800 each year on groceries.

Credit cardAnnual feeRewards rateAnnual earnings breakdownWorth it?
The Blue Cash Preferred® Card from American Express$956% cash back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%). 3% cash back at U.S. gas stations($4,800 x .06) + ($2,400 x .03) = $360Yes. After subtracting the $95 annual fee, this person’s rewards earnings would be $265.

*For a limited time, the Blue Cash Preferred is waiving the annual fee for the first year, then $95 annually. Offer ends 12/10/20.

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.

Let’s try calculating the value of a popular travel rewards card, the American Express® Gold Card. In this scenario, we’re calculating the earnings of someone who annually spends $4,800 at U.S. supermarkets, $1,500 at restaurants worldwide, and $1,000 on flights. American Express Membership Rewards points are valued at 2 cents apiece.

Credit cardAnnual feeRewards rateAnnual earnings breakdownWorth it?
American Express® Gold Card$2504X points on dining and at U.S. supermarkets (on up to $25,000 in purchases per year, then 1X). 3X points on flights booked directly with airlines or on amextravel.com.($4,800 x 4) + ($1,500 x 4) + ($1,000 x 3) = 28,200 points = $564Yes. After subtracting the $250 annual fee, this person’s rewards earnings would be $314.

 

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.

Our 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. However, beginning Jan. 1, 2021, the Platinum Card’s offer will be capped at $500,000 on these purchases per calendar year.

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).

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 CategoryTop OfferHighestAverageLowest
Welcome bonus
Points
Chase Sapphire Preferred
Chase Sapphire Preferred
60,000 points40,625 points15,000 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 Rewards2X miles1.58X points or miles1.25X 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