September 15, 2023
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The best rewards credit card depends on what type of rewards you want to earn: cash back, points or miles. Our picks for best cash back rewards cards will allow you to earn cash back on everyday spending, while the best travel rewards cards can help you take that dream vacation. And if you’re a small business owner, check out our picks for best business rewards cards.
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Rewards: 1 – 5% cash back
The Chase Freedom Flex℠ is our pick for the best rewards card because it offers a high rate of cash back in a variety of categories, has a $0 annual fee and comes with an easy-to-earn sign-up bonus. In addition to offering cash back in ongoing categories — travel, dining and drugstore purchases — the Chase Freedom Flex℠ allows you to earn cash back in rotating quarterly bonus categories.
If you want a low-maintenance rewards card, look elsewhere. While you’d be hard-pressed to find a no-annual-fee card with higher rewards rates in so many categories, you will need to activate the quarterly categories in order to earn the elevated cash back rate with the Chase Freedom Flex℠.
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Rewards: 1 – 5% cash back
If you want a low-maintenance card that rewards you for the spending you’re already doing, we recommend the Citi Custom Cash® Card. You’ll earn cash back on every purchase and even more cash back on your top eligible spending category – up to $500 per billing cycle. You don’t have to opt in – you’ll earn the higher cash back rate just by using your card. The Citi Custom Cash® Card comes with a decent sign-up bonus and an annual fee of $0.
Rewards: 2% cash back
Earn unlimited 2% cash rewards on purchases.
The Wells Fargo Active Cash® Card is best if you want unlimited rewards without having to remember bonus categories or activate quarterly promotions. It’s the ultimate low-maintenance card, allowing cardholders to earn unlimited 2% cash rewards on purchases. Rewards never expire and redeeming rewards starts at just $1. Cardholders can even redeem rewards at the ATM with their linked Wells Fargo ATM or debit card.
Rewards: 1 – 6% cash back
The Blue Cash Preferred® Card from American Express is our pick for best grocery rewards card. It has one of the highest cash back rates available at U.S. supermarkets and offers an excellent cash back rate on U.S. streaming subscriptions, transit and at U.S. gas stations. If you max out the annual $6,000 spending cap at U.S. supermarkets, you’ll earn $360 back from those purchases, which more than covers the annual fee.
To see rates & fees for Blue Cash Preferred® Card from American Express please click here.
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Rewards: 1 – 8% cash back
3% Cash Back on dining and at grocery stores (excluding superstores like Walmart® and Target®); 3% Cash Back on popular streaming services and entertainment; 8% Cash Back on Capital One Entertainment purchases; 1% Cash Back on all other purchases.
The Capital One SavorOne Cash Rewards Credit Card is our pick for best rewards card for foodies. You’ll earn a high rate of cash back for restaurant purchases – including dine-in, takeout, and delivery – and at grocery stores, except superstores like Target and Walmart. The Capital One SavorOne Cash Rewards Credit Card also offers an outstanding cash back rate on streaming services and entertainment purchases with a variety of merchants.
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Our experts rate credit cards based on several factors including card benefits, bonus offers and independent research. Credit card issuers do not influence or have a say in our card ratings. Read our credit card methodology here. Apply Now
Rewards: 1 – 2% cash back
If you’re carrying high-interest debt on a non-Citi credit card, transferring your balance to the Citi® Double Cash Card can give you a long window of time to pay off what you owe without incurring interest. Once you pay off what you’ve transferred, this card is worth keeping in your wallet for its cash back rewards. Every purchase earns the same flat rate, which means you can earn cash back without worrying about keeping track of rewards rates or spending categories.
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Rewards: 1.5 – 5% cash back
1.5% Cash Back on every purchase, every day; 5% Cash Back on hotels and rental cars booked through Capital One Travel (terms apply).
If you want to earn cash back while building your credit, the Capital One QuicksilverOne Cash Rewards Credit Card is a good option. You’ll get cash back on all purchases without having to track bonus categories or rewards rates. After demonstrating responsible card usage and building a relationship with Capital One, you can request a product change to the Capital One Quicksilver Cash Rewards Credit Card, which has a $0 annual fee.
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Rewards: 1 – 2% cash back
2% cash back at gas stations and restaurants on up to $1,000 in combined purchases each quarter. 1% unlimited cash back on all other purchases - automatically.
The Discover it® Secured Credit Card is our pick for best rewards card for bad credit because cardholders earn cash back with every purchase – and even more cash back on gas and restaurants – while rebuilding their credit. It charges a $0 annual fee and is accessible with a $200 minimum security deposit. Best of all, after seven months with the card, Discover begins conducting monthly account reviews to see if you’re eligible to graduate to an unsecured card and get your deposit refunded.
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Rewards: 1 – 5% cash back
5% cash back on everyday purchases at different places each quarter like Amazon.com, grocery stores, restaurants, and gas stations, up to the quarterly maximum when you activate. Plus, earn unlimited 1% cash back on all other purchases – automatically.
With a $0 annual fee, the Discover it® Student Cash Back is an excellent first credit card for college students. It can help you build credit history while earning cash back on specific bonus categories, as long as you’re willing to activate a new rewards category each quarter. You’ll also earn cash back on all other purchases. Unlike some credit cards designed for college students, the Discover it® Student Cash Back card doesn’t require a security deposit.
Rewards: 1 – 5% cash back
If you do a lot of your shopping on Amazon, you should consider the Prime Visa for its high rate of cash back on Amazon purchases. It’s worth having for everyday spending, too – you’ll earn cash back on every purchase with higher earning rates at Whole Foods, restaurants and gas stations. You can easily redeem your rewards to pay for future Amazon purchases.
The annual fee is $0, but know that you’re required to pay for an annual Prime membership ($139 or $69 for college students) in order to qualify for the higher rewards rate.
Rewards: 2x – 5x points on travel purchases
Enjoy benefits such as 5x on travel purchased through Chase Ultimate Rewards®, 3x on dining, and 2x on all other travel purchases, and $50 annual Ultimate Rewards Hotel Credit, plus more..
The Chase Sapphire Preferred® Card is our pick for best travel rewards card because it offers elevated rewards rates on travel and dining, excellent travel protections and a great sign-up bonus – all for a reasonable annual fee of $95. You can redeem Chase Ultimate Rewards® points for cash back at a value of 1 cent per point, use them to book travel through the Chase Ultimate Rewards® portal for 1.25 cents per point or transfer them at a 1:1 rate to a variety of airline and hotel partners like JetBlue, United, Marriott and Hyatt.
Rewards: 3x – 14x points
Earn 14X per $1 of eligible purchases on your card directly with a participating Hilton hotel or resort, 7X for eligible purchases: on flights booked directly with airlines or amextravel.com; on car rentals booked directly from select car rental companies; & at U.S. restaurants, and 3X for other purchases on your card.
If you’re a Hilton Honors loyalist, you can earn a generous rewards rate on participating Hilton hotel and resort stays with the Hilton Honors Aspire Card from American Express. You can redeem points for free night stays, experiences, Lyft rides, merchandise or car rentals. Plus, you’ll get up to two weekend night awards a year and complimentary Diamond elite status. Cardholders also enjoy a $250 airline fee credit every year (you must select one qualifying airline) and a complimentary Priority Pass™ Select (enrollment required), which provides access to more than 1,200 airport lounges worldwide.
Rewards: 1x – 3x miles
If you’re looking to earn airline miles – not to mention airline perks – look no further than the Delta SkyMiles® Platinum American Express Card. You’ll earn more miles when you make purchases at Delta, hotels, restaurants and U.S. supermarkets. Plus, you can easily offset the $250 annual fee with Delta perks like a free checked bag on each flight and a fee credit for Global Entry or TSA Precheck® after you apply through any Official Enrollment Provider.
To see rates & fees for Delta SkyMiles® Platinum American Express Card please click here.
Rewards: up to 5x points
If you travel frequently enough to take advantage of the benefits, you stand to squeeze a lot of value from The Platinum Card® from American Express, even with its $695 annual fee. The card offers numerous benefits and credits, including automatic Marriott Bonvoy™ Gold Elite status (enrollment required), automatic Hilton Honors Gold status (enrollment required) and premium car rental privileges. Plus, you’ll get up to a $200 annual airline fee credit, up to a $200 annual hotel credit, a Global Entry or TSA Precheck application fee credit, up to a $189 annual CLEAR® membership credit and more.
To see rates & fees for The Platinum Card® from American Express please click here.
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Rewards: 1.25x – 5x miles
1.25 Miles per dollar on every purchase, every day; 5 Miles per dollar on hotels and rental cars booked through Capital One Travel.
The Capital One VentureOne Rewards Credit Card is our pick for best starter travel credit card because it offers bonus earning rates on hotels and rental cars booked through Capital One Travel, a decent rewards rate on general purchases and a sign-up bonus that’s easy to earn. If you’re new to travel and want a card that doesn’t hit you with an annual fee, the Capital One VentureOne Rewards Credit Card is a solid pick.
Rewards: 1x – 3x points
If you’re a business owner who racks up miles on business trips, you’ll have a hard time finding a better rewards card than the Ink Business Preferred® Credit Card. You’ll earn rewards with every purchase, and you can take advantage of bonus earnings on travel and select business categories up to $150,000 per year.
It’s a great pick if you’re anticipating significant business expenses in the next few months, since you’ll need to spend heavily in order to earn the sign-up bonus. If you’re able to meet the spending requirement, the points you earn with the sign-up bonus may be enough to cover airfare for a future trip (or two).
Rewards: 2 – 5% cash back
2% Cash Back on every purchase; 5% Cash Back on hotels and rental cars booked through Capital One Travel.
The Capital One Spark Cash Plus is one of the most rewarding and straightforward credit cards for business owners. You’ll earn flat rate cash back on the majority of purchases, and there is no preset spending limit, so you can adapt the card to your business needs. Business owners who need to carry a balance should look elsewhere – the Capital One Spark Cash Plus charges a 2.99% monthly late fee on unpaid balances.
| Credit Cards | Our Ratings | Rewards Rate | Welcome Offer | Recommended Credit | |
|---|---|---|---|---|---|
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Chase Freedom Flex℠
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Winner
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5% cash back on up to $1,500 in combined purchases in bonus categories each quarter you activate. Enjoy new 5% categories each quarter! Plus, earn 5% cash back on travel purchased through Chase Ultimate Rewards®, 3% on dining and drugstores, and 1% on all other purchases. | Earn a $200 bonus after you spend $500 on purchases in the first 3 months from account opening. Plus, earn 5% cash back on grocery store purchases (excluding Target and Walmart) on up to $12,000 spent in the first year. | Excellent/Good | |
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Citi Custom Cash® Card
Apply Now
on Citibank's secure site Rates & Fees |
Gas
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Earn 5% cash back on purchases in your top eligible spend category each billing cycle, up to the first $500 spent, 1% cash back thereafter. Also, earn unlimited 1% cash back on all other purchases. | Earn $200 in cash back after you spend $1500 on purchases in the first 6 months of account opening. This bonus offer will be fulfilled as 20,000 ThankYou® points, which can be redeemed for $200 cash back. | Excellent/Good/Fair |
Apply Now
on Citibank's secure site Rates & Fees |
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Wells Fargo Active Cash® Card
Review Coming Soon
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2% cash back
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Earn unlimited 2% cash rewards on purchases | Earn a $200 cash rewards bonus after spending $500 in purchases in the first 3 months | Excellent/Good | Review Coming Soon |
Blue Cash Preferred® Card from American Express
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Groceries
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6% Cash Back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%), 6% Cash Back on select U.S. streaming subscriptions, 3% Cash Back at U.S. gas stations and on transit (including taxis/rideshare, parking, tolls, trains, buses and more), 1% Cash Back on other purchases. Terms apply. | Earn a $250 statement credit after you spend $3,000 in purchases on your new Card within the first 6 months. | Excellent/Good | |
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Capital One SavorOne Cash Rewards Credit Card
Apply Now
on Capital One's secure site Rates & Fees |
Dining rewards
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3% Cash Back on dining and at grocery stores (excluding superstores like Walmart® and Target®); 3% Cash Back on popular streaming services and entertainment; 8% Cash Back on Capital One Entertainment purchases; 1% Cash Back on all other purchases | $200 Cash Back after you spend $500 on purchases within 3 months from account opening | Excellent/Good |
Apply Now
on Capital One's secure site Rates & Fees |
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Citi® Double Cash Card – 18 month BT offer
Apply Now
on Citibank's secure site Rates & Fees |
Balance transfers
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Earn 2% on every purchase with unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases. | None | Excellent/Good/Fair |
Apply Now
on Citibank's secure site Rates & Fees |
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Capital One QuicksilverOne Cash Rewards Credit Card
Apply Now
on Capital One's secure site Rates & Fees |
Fair credit
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1.5% Cash Back on every purchase, every day; 5% Cash Back on hotels and rental cars booked through Capital One Travel (terms apply) | No bonus | Fair/Limited |
Apply Now
on Capital One's secure site Rates & Fees |
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Discover it® Secured Credit Card
Apply Now
on Discover's secure site Rates & Fees |
Bad credit
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2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter. 1% unlimited cash back on all other purchases - automatically | Discover will match all the cash back you’ve earned at the end of your first year. | Poor/Limited |
Apply Now
on Discover's secure site Rates & Fees |
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Discover it® Student Cash Back
Apply Now
on Discover's secure site Rates & Fees |
Students
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5% cash back on everyday purchases at different places each quarter like Amazon.com, grocery stores, restaurants, and gas stations, up to the quarterly maximum when you activate. Plus, earn unlimited 1% cash back on all other purchases – automatically | Unlimited Cashback Match – only from Discover. Discover will automatically match all the cash back you’ve earned at the end of your first year! So you could turn $50 cash back into $100. Or turn $100 into $200. There’s no minimum spending or maximum rewards. Just a dollar-for-dollar match. | Fair/Limited |
Apply Now
on Discover's secure site Rates & Fees |
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Prime Visa
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Amazon
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Earn 5% back at Amazon.com, Amazon Fresh, Whole Foods Market, and on Chase Travel purchases with an eligible Prime membership, 2% back at gas stations, restaurants, and on local transit and commuting (including rideshare), and 1% on all other purchases | Get a $100 (or more) Amazon Gift Card instantly upon approval exclusively for Prime members | Excellent/Good | |
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Chase Sapphire Preferred® Card
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Travel rewards
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Enjoy benefits such as 5x on travel purchased through Chase Ultimate Rewards®, 3x on dining, and 2x on all other travel purchases, and $50 annual Ultimate Rewards Hotel Credit, plus more. | Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $750 when you redeem through Chase Ultimate Rewards®. | Excellent | |
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Hilton Honors Aspire Card from American Express
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Hotel rewards
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Earn 14X per $1 of eligible purchases on your card directly with a participating Hilton hotel or resort, 7X for eligible purchases: on flights booked directly with airlines or amextravel.com; on car rentals booked directly from select car rental companies; & at U.S. restaurants, and 3X for other purchases on your card | Earn 150,000 Hilton Honors Bonus Points after you spend $4,000 in purchases on the Card within your first 3 months of Card Membership. | Excellent/Good | |
Delta SkyMiles® Platinum American Express Card
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Airline rewards
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Earn 3X Miles on Delta purchases and purchases made directly with hotels. Earn 2X Miles at restaurants worldwide, plus takeout and delivery in the U.S., and at U.S. supermarkets and earn 1X Miles on all other eligible purchases. | Earn 50,000 bonus miles after you spend $3,000 in purchases on your new Card in your first 6 months. | Excellent/Good | |
The Platinum Card® from American Express
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Premium travel
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5X Membership Rewards® points on flights booked directly with airlines or with American Express Travel on up to $500,000 on these purchases per calendar year and 5X Membership Rewards® points on prepaid hotels booked with American Express Travel. Terms apply. | Earn 80,000 Membership Rewards® Points after you spend $8,000 on purchases on your new Card in your first 6 months of Card Membership. | Excellent/Good | |
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Capital One VentureOne Rewards Credit Card
Apply Now
on Capital One's secure site Rates & Fees |
Starter travel
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1.25 Miles per dollar on every purchase, every day; 5 Miles per dollar on hotels and rental cars booked through Capital One Travel | Earn a bonus of 20,000 miles once you spend $500 on purchases within 3 months from account opening, equal to $200 in travel | Excellent/Good |
Apply Now
on Capital One's secure site Rates & Fees |
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Ink Business Preferred® Credit Card
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Business travel
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Earn 3 points per $1 on the first $150,000 spent in combined purchases on travel, shipping purchases, Internet, cable and phone services, advertising purchases made with social media sites and search engines each account anniversary year. Earn 1 point per $1 on all other purchases—with no limit to the amount you can earn. | Earn 100,000 bonus points after you spend $8,000 on purchases in the first 3 months from account opening. | Excellent | |
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Capital One Spark Cash Plus
Review Coming Soon
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Business cash back
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2% Cash Back on every purchase; 5% Cash Back on hotels and rental cars booked through Capital One Travel | Earn a one-time cash bonus of $1,200 once you spend $30,000 in the first 3 months. | Excellent | Review Coming Soon |
Pick your rewards
The first step to choosing the right rewards card is to decide what kind of rewards you want. Here are the different types of rewards you can earn with a credit card:
Cash back
Cash back credit cards give you a percentage of your purchases as cash back. Cash back rewards are usually issued as statement credits (i.e. money applied toward your next credit card bill), a physical check or a deposit to your linked bank account. Some redemptions happen automatically, while others require you to initiate a request.
Travel rewards (flexible points)
General travel credit cards give you flexible points for every dollar you spend. Some credit card issuers like Capital One refer to points as “miles,” but the concept is the same. Depending on the card, you can redeem these points or miles to book travel on your credit card issuer’s travel portal, transfer the points to travel partners like airlines or hotels, or redeem the points for cash back or gift cards.
Airline rewards
Airline credit cards earn miles towards future travel with a particular airline. These cards are issued in coordination with an airline to provide airline-specific benefits for travelers, such as free checked bags, priority boarding, in-flight discounts and even complimentary upgrades.
You can use your airline card for non-travel purchases. In fact, some airline credit cards accelerate your path to elite status based on your annual spending. Having elite status with an airline means you’ll get additional travel perks when you fly.
Hotel rewards
Hotel credit cards offer perks when staying at participating hotels. Cardholders typically receive automatic elite status, bonus points when paying for their stay and an annual free night.
Business rewards
Small business owners can use business rewards credit cards to earn cash back, points or miles. Business owners who want simple, low-maintenance rewards should consider a cash back credit card that they can use to help offset the cost of future purchases. Business travel cards are perfect for those who prefer flexible rewards, travel perks and the ability to redeem rewards for airline tickets and hotel stays.
Match rewards with your spending
Find a card that rewards you for the spending you’re already doing. For instance, if you’re a regular at the grocery store, look for a card with high rewards rates for grocery shopping. This allows you to maximize the rewards earned on your regular purchases.
Some people get multiple cards that earn the same type of rewards to take advantage of each card’s bonus categories. For example, you could pair the Chase Freedom Flex℠ with the Chase Sapphire Preferred® Card credit card to take advantage of each card’s bonus categories and maximize your rewards.
Figure out what cards you can qualify for
Knowing your credit score allows you to focus on the rewards credit cards you’re most likely to get approved for. Many banks, websites and apps offer tools that show you your credit score for free.
The best rewards credit cards are for people with excellent credit, but there are also good card options for every type of credit. Even people with fair credit or those who are rebuilding their credit can qualify for cards with valuable rewards and benefits until their credit scores improve.
Don’t know your credit score?Decide how much time you’ll spend maximizing rewards
Credit card rewards don’t have to be complicated, but you can certainly spend a lot of time planning, tracking, and redeeming your rewards in order to maximize their value.
If you’re short on time and want a low-maintenance option, go for a cash back card with high rates on your most common spending categories. You can even pair this card with a cash back card that offers cash back rewards on every purchase, like the Citi® Double Cash Card .
If you’re willing to invest some time into getting value out of your rewards, consider pairing a travel credit card with a cash back card that rewards you for your everyday spending. You can even get a few rewards cards – just make sure that the benefits and rewards of each card outweigh its annual fee.
Do the math to decide which card is best for you
After narrowing down your choices, compare how much you will likely earn from each card you’re considering in the first year. Factor in the welcome bonus, rewards earned from spending and annual credits. Then subtract the annual fee to determine your net benefit from each rewards card.
Let’s take the following cash back and flat-rate cards as an example:
| Feature | Card A (points worth $0.01 each) - Winner | Card B (cash back card) | Card C (no-annual-fee cash back card) |
|---|---|---|---|
| Sign-up bonus | 50,000 points | $250 | $200 |
| Earning rate | 2X points on every purchase | 6% cash back on groceries, 3% cash back on gas, 1% cash back on everything else | 2% cash back on every purchase |
| Rewards earned on $6,000 in groceries | 12,000 points worth $120 | $360 | $120 |
| Rewards earned on $3,000 in gas | 6,000 points worth $60 | $90 | $60 |
| Rewards earned on $11,000 in other spend | 22,000 points worth $220 | $110 | $110 |
| Annual fee | $95 | $95 | $0 |
| First year value (rewards minus annual fee) | $805 | $715 | $490 |
After taking into account the card’s welcome offer, earning rate and annual fee, Card A offers the most value during the first year of card membership. However, the comparison may look different in the second year when there isn’t a welcome offer.
Assuming you’ll still spend about the same amount on groceries, gas and other purchases, here’s what you’ll earn in the second year (and all years going forward, assuming the same spending):
| Feature | Card A (points worth $0.01 each) | Card B (cash back card) - Winner | Card C (no-annual-fee cash back card) |
|---|---|---|---|
| Earning rate | 2X points on every purchase | 6% cash back on groceries, 3% cash back on gas, 1% cash back on everything else | 2% cash back on every purchase |
| Rewards earned on $6,000 in groceries | 12,000 points worth $120 | $360 | $120 |
| Rewards earned on $3,000 in gas | 6,000 points worth $60 | $90 | $60 |
| Rewards earned on $11,000 in other spend | 22,000 points worth $220 | $110 | $110 |
| Annual fee | $95 | $95 | $0 |
| Rewards minus annual fee | $305 | $465 | $290 |
This calculation helps you decide if you should keep the card going forward or switch to a different one. Card B is the clear winner here in terms of ongoing value.
You should also know that some people assign a cash value to other card benefits, like free checked bags, as part of the comparison. Only include these benefits if they actually earn or save you additional money. For example, travelers who only carry on their luggage won’t actually save money with the free checked bags benefits.
Different cash back cards have different rewards structures. To help you decide which card is best for you, we’ve explained the three most common types of cash back rewards below.
Flat rate cash back credit cards
Flat rate cash back cards give the same percentage of cash back on every purchase, regardless of category. The benefit of these cards is that you won’t have to track bonus categories. The Wells Fargo Active Cash® Card, which allows you to earn unlimited 2% cash rewards on purchases, is one popular flat rate cash back card.
Tiered cash back credit cards
Tiered cash back credit cards offer higher cash back rewards rates for purchases in specific categories. These cards are best for people who want to maximize rewards by getting high rates of cash back on the categories they spend the most in each month.
The Blue Cash Preferred® Card from American Express is a popular tiered cash back card. It offers a higher percentage of cash back at U.S. supermarkets and on select U.S. streaming subscriptions, a middle rate of cash back at U.S. gas stations, and a lower percentage of cash back on all other purchases.
Rotating cash back credit cards
Rotating cash back cards offer high cash back rates on specific categories for a short amount of time, usually quarterly. These cards are best for people who love to get a good deal and who are willing to put in the effort necessary to track bonus categories. Some rotating cash back cards may require that you opt in to receive the higher rewards rate.
Our top rewards card pick, the Chase Freedom Flex℠, is one of the most popular rotating cash back cards. It offers a high cash back rate on rotating quarterly bonus categories along with ongoing tiered cash back on travel purchased through Chase Ultimate Rewards, dining, and drugstore purchases.
Earning cash back rewards is simple – you use your cash back card to make purchases. If you have multiple cash back cards, consider which card has the highest rewards rate when making a particular purchase.
For instance, if you have the Prime Visa and the Citi® Double Cash Card , you should use the Prime Visa to book travel on the Chase travel portal and to make all of your Amazon and Whole Foods purchases because of the higher cash back rates. You can use either card for purchases at gas stations, restaurants and on local travel and commuting, since their cash back rates are the same in those two categories. You should use the Citi® Double Cash Card on all of your other purchases, since its cash back rate on general purchases is higher.
Different cards have different redemption options for cash back rewards. Common redemption options include: statement credits (i.e. applying your cash back rewards toward your next credit card bill), checks and even deposits to a connected bank account.
Earning travel rewards can be as simple as using your travel credit card to make purchases. Just be aware that some travel cards require you to use the credit card’s travel portal to earn the highest rewards rate on travel purchases.
If you have multiple credit cards that earn the same flexible points, most programs allow you to pool your rewards to reach your goals faster. Popular travel rewards currencies include Chase Ultimate Rewards points, Capital One Rewards Miles and American Express Membership Rewards® points.
Banks offer cardholders numerous ways to redeem points, but some choices offer much higher value than others. Credit card rewards generally have the highest value when redeeming them for travel or transferring points to airline and hotel partners. And you’ll generally receive the lowest value for your points when redeeming them for merchandise, using them for online shopping or buying gift cards.
Each rewards program is different, so the value that you receive with these options will vary. In some cases, you may get a higher value when you have a specific card. For example, your points are worth 50% more when booking travel through Ultimate Rewards if you have the Chase Sapphire Reserve.
Not all points are created equal. Understanding the value of your points allows you to compare the value of different redemption options (e.g. travel bookings, statement credits), and to compare the value of points across different credit card issuers.
To calculate how much a point is worth for a particular reward redemption, first, determine how much it would cost if you paid cash. Subtract any taxes or fees that you still have to pay. Then, divide that total by the number of points you’re redeeming. The result is the value per point for that redemption.
Point value = Cost in cash (minus taxes/fees that you still have to pay) ÷ Number of pointsLet’s say you want to buy a $1,500 laptop. In your state, you’ll pay $124 in taxes. When you sign in to your credit card’s shopping portal, you see that you need 190,000 points to buy the laptop. Here’s how to calculate the point value for this reward redemption:
Example: ($1,500 laptop computer – $124 in taxes) ÷ 190,000 points = $0.007 point value (less than 1 cent/point)
Let’s say you know that your points are worth $0.0125 (1.25 cents) each when you redeem your points through your credit card’s travel portal. That means you can use those same 190,000 points to book $2,375 worth of travel (plus tax). In this case, you might decide to use your rewards points to book future trips.
Rewards credit cards are worth it as long as you’re able to pay off your balance on time and in full each month. These cards offer value in the form of cash back, miles or points that can add up quickly. That said, if your rewards card charges an annual fee, make sure the card benefits outweigh what you’re paying.
If you have credit card debt or a tendency to overspend, a rewards card may not be right for you. Rewards credit cards typically come with high interest rates, so carrying a balance on a rewards card will likely mean paying more in interest than you would on a low-interest credit card. Many people with rewards cards also spend more than they normally would to chase additional rewards, which can lead to credit card debt and other financial concerns. No rewards are worth the interest that a bank charges for carrying a balance.
Most rewards credit cards let you earn rewards when you make eligible purchases using your card and when you spend enough to earn the card’s sign-up or welcome offer. Rewards cards may also offer annual bonuses each year on your account anniversary, a referral bonus when you refer a friend to the card and the friend is approved, or when you add an authorized user to your credit card account. You cannot earn rewards on cash advances, balance transfers or illegal transactions.
The amount of rewards points you can earn depends on the card. Some cards offer an unlimited flat rewards rate on every purchase. Others may offer 1 point or mile (or 1% back for cash back cards) per dollar spent on general purchases, and extra points, miles or cash back in bonus spending categories, like gas, dining or airfare. While you may be limited on the amount of extra rewards you can earn from bonus categories, rewards cards typically allow you to earn unlimited rewards on general purchases.
Rewards for most credit cards don’t expire as long as your account remains open and in good standing. However, some cards withdraw your rewards if you don’t make a charge on your card or redeem rewards within a given time period.
You probably can carry a balance on your rewards card, but you shouldn’t. Rewards cards tend to have higher interest rates (APRs) than non-rewards cards, so carrying a balance from month to month can get expensive, as those interest charges are added to your balance. Interest rates are almost always higher than rewards rates, so you’ll be paying more in interest than you earn in rewards. If you need to carry a balance, look for a card with low interest rates.
There are many rewards credit cards that offer a high level of rewards in different categories. For example, the Capital One Venture X Rewards Credit Card offers 10X miles on hotels and rental cars booked through its travel portal. The goal is to find cards that offer high rewards rates in categories that match your spending.
Cash back credit card rewards are considered a refund on the amount you spend. Because of this, the IRS does not require consumers to pay taxes on credit card rewards earned by spending money. That said, if the reward doesn’t require that you spend a certain amount to earn it, the IRS may not consider it a refund, and it might be taxable.
Ultimately, the best rewards credit card for you depends on how you plan to use the card. For example, if you eat out frequently, a dining rewards card may be ideal. But if you’d prefer a simple approach to earning rewards, a flat-rate cash back card may be a better fit.
The best travel rewards credit card depends on whether you want to earn airline miles, hotel points or flexible points, your spending patterns and your willingness to pay an annual fee. Our choice for the best credit card for travel rewards is the Chase Sapphire Preferred® Card. You’ll earn up to 5X points on purchases and receive travel and purchase protections. Its flexible points transfer to 14 hotel and airline partners and are worth 25% more when booking travel through Ultimate Rewards.
The ability to combine rewards earned on two credit cards depends on the type of rewards. If the rewards are of the same type (e.g. American Airlines AAdvantage miles), then combining them is likely possible. However, if the rewards are of different types, then generally they cannot be combined. Flexible points can be transferred to multiple loyalty programs, and may be combined with rewards earned within those partner programs.
Responsible use of rewards cards can build a positive credit history, but rewards cards in themselves won’t help you build credit faster. In order to build credit, you should pay your balance in full and on time every month. Keep your balance low – ideally, less than 30% of your credit limit.
In general, you’ll need good to excellent credit – a FICO score of 670+ – to be approved for a rewards credit card. The better your credit, the more options you’ll have. That said, there are rewards cards designed for students, people with fair credit, and people with bad credit. Most of these cards offer clear guidelines for upgrading to cards with better terms and rewards once you’ve established a history of paying off your card on time and in full.
To select the best rewards credit card for each of these categories, our experts compared credit cards that offer rewards programs on LendingTree.com and on major issuer sites. This included cash back credit cards, 0% intro APR cards, balance transfer credit cards, secured cards, student cards and more.
We then chose our top picks based on a variety of factors, such as:
Type of rewards offered
Value of the card’s sign-up bonus
Rewards redemption options
Annual fee
Interest rates
Other factors that came into play when making our selection include the benefits offered by the card, such as purchase and extended warranty protections.
To see rates & fees for Blue Cash Preferred® Card from American Express please click here.
To see rates & fees for Delta SkyMiles® Platinum American Express Card please click here.
To see rates & fees for The Platinum Card® from American Express please click here.
The information related to the Chase Freedom Flex℠, Wells Fargo Active Cash® Card, Prime Visa, Chase Sapphire Preferred® Card, Hilton Honors Aspire Card from American Express, Ink Business Preferred® Credit Card, and Capital One Spark Cash Plus has been collected by LendingTree and has not been reviewed or provided by the issuer of this card prior to publication. Terms apply.
For Capital One products listed on this page, some of the above benefits are provided by Visa® or Mastercard® and may vary by product. See the respective Guide to Benefits for details, as terms and exclusions apply
The above offers and/or promotions may have since changed, expired, or is no longer available. Check the Issuers’ website for more details.
