Rewards credit cards come in two main varieties: cash-back cards and travel cards. Cash-back cards pay you back a percentage of the amount of each transaction. Travel rewards credit cards give you points or miles for each dollar you spend; you redeem those rewards for free flights, hotel stays and more. No single rewards card is right for everyone. It’s all about how you spend money and what kind of rewards you value.
Capital One Venture Rewards Credit Card
Easy-to-earn, easy-to-redeem rewards have rightly made the Capital One Venture Rewards Credit Card one of the best-loved travel credit cards on the market.
You earn 5 points per dollar spent on hotels and car rentals booked through Capital One Travel and 2 miles per dollar spent on all other purchases. Miles can be redeemed for credit on your statement against most travel expenses. You’re not restricted to any particular airline or hotel, and there’s no minimum amount required to redeem. Just book your own travel, then pay for it with rewards. The great sign-up bonus starts you off right, too.
If you’re loyal to a particular airline or hotel chain, you may get more value from one of that brand’s own cards. This card allows you to transfer miles to several airline frequent-flyer programs, but the options aren’t very strong.
Blue Cash Preferred® Card from American Express
If groceries, gas and/or commuting are among your most common expenses, the Blue Cash Preferred® Card from American Express is a winner.
This card offers industry-leading rewards at U.S. supermarkets — 6% cash back on up to $6,000 in spending per year (then 1%) — supplemented by 3% cash back at U.S. gas stations and on transit (including such things as taxis, rideshares, buses, trains, tolls and parking). You also get 6% cash back on select U.S. streaming subscriptions. All other purchases earn 1% back. A welcome offer adds to the appeal.
This card has a high annual fee, although if you spend at least $31 a week at U.S. supermarkets, the cash back will offset it. Because it’s from American Express, you might have trouble using it in some places.
Wells Fargo Active Cash℠ Card
The Wells Fargo Active Cash℠ Card offers a combination of features that few other flat-rate cards can match, starting out with a rich and unlimited 2% cash back on every purchase.
Aside from the excellent flat cash-back rewards rate, new cardholders also are eligible for a generous sign-up bonus: Earn a $200 cash rewards bonus after spending $1,000 in purchases in the first 3 months.. There’s also an intro APR period.
There’s a foreign transaction fee, common among cash-back credit cards. And you can find cards with richer rates on popular spending categories, if you’re willing to put up with their more complex reward structures.
Citi Custom Cash℠ Card
The Citi Custom Cash℠ Card offers a twist on existing 5%-back credit cards: You’ll earn 5% back automatically based on your spending habits, not based on rotating quarterly bonus calendars. Terms apply. That makes it a low-maintenance — and potentially valuable — option.
This card earns 5% cash back on up to $500 spent in your highest-spend category per billing cycle (from a list of eligible options). And those options happen to be popular spending categories like restaurants, grocery stores, streaming services, select travel expenses and more. There’s also a sign-up bonus and an intro APR period, all for an annual fee of $0.
The monthly spending cap on your 5% rate will limit the amount of cash back you can accrue. And all other spending beyond your one eligible bonus category will earn just 1% back.
Chase Freedom Unlimited®
The Chase Freedom Unlimited® was already a fine card when it offered 1.5% cash back on all purchases. Now it’s even better, with bonus rewards on travel booked through Chase, as well as at restaurants and drugstores. New cardholders get a great bonus offer, too.
This card earns 5% cash back on travel booked through Chase; 3% cash back at restaurants and drugstores; and 1.5% on other purchases. New cardholders can snag this sign-up bonus: Earn an additional 1.5% cash back on everything you buy (on up to $20,000 spent in the first year) – worth up to $300 cash back! If you’re a maximizer, you can transfer your rewards to one of Chase’s Sapphire cards to boost their value by 25% or 50%.
While you can earn big rewards on travel bookings with this card, it also charges a 3% foreign transaction fee, so it’s not a good companion abroad.