It used to be accepted fact that miles rewards cards came with significant annual fees. Then a few companies introduced cards without fees, but the rewards rates were pretty sub-par. Recently, that’s all changed, as several companies have come out with competing cards offering high miles rewards rates and attractive bonuses without charging any annual fees. One in particular is paying an astounding 3 miles per dollar during the entire first year.
In order to make it onto the list below, each of these cards had to offer a big-time rewards program and a hefty sign-up bonus. They were allowed to charge an annual fee, just so long as that fee equaled $0, zero, zippo or nada.
The 3 Miles Per Dollar Card
The Discover it Miles ranks at the top of our list of no fee miles rewards cards because of the incredible rewards rate you earn during the entire first year. Because you earn a base rate of 1.5 miles per dollar your spend, and because Discover will double the amount of total miles you earn during the first year, you actually earn 3 miles per dollar! This means that during the first year, the card actually pays far more miles per dollar than even the best-paying cards, even those charging big annual fees. The Discover it Miles also offers great side benefits like a free FICO score on each statement, a $30 annual wifi credit for in-flight wifi charges, and 0% intro APR on purchases during the first 12 months. You can convert all miles earned into cash back.
Most Appropriate For: Those who want to earn a high mile per dollar reward rate, but don’t know if their annual spending will be enough to justify paying an annual fee.
Least Appropriate For: Those who spend enough to justify an annual fee, since the rewards rate will come down to 1.5 miles per dollar after first year.
The Verdict: The astounding 3 miles per dollar reward rate in the first year would be impressive for any card, but is unheard of for one with $0 annual fee.
The 20,000 Bonus Points Card
The BankAmericard Travel Rewards wasn’t rated as Kiplinger’s Best Travel Credit Cards for nothing. If you use it to make $1,000 or more worth of purchases in the first 90 days, you’ll earn a new-account bonus of 20,000 points. That’s almost enough points for a free domestic flight right off the bat. It pays an ongoing 1.5 points per dollar reward rate, which is at the very high end for a no-fee travel card. If you bank with Bank of America or Merrill Lynch, then this is almost certainly your best bet, as you can get up to a 75% rewards rate accelerator, meaning you’ll be earning an insane 2.6 points per dollar with no limits or expirations date, without paying a penny in annual fees.
Most Appropriate For: Anyone who wants to earn 20,000 bonus points and a high rewards rate without paying an annual fee. Definitely for anyone who currently banks with Bank of America.
Least Appropriate For: Those who spend enough to justify an annual fee. If you spend more than $1,200 per month in your first year, the Discover it Miles bonus would be larger.
The Verdict: A great card for anyone who might spend less than $1,200 per month on their rewards card. The hands-down best $0 fee travel card for those who bank with Bank of America due to the rewards accelerator.
The 50,000 Bonus Miles Card
Ok, we sort of fudged a little; we are including one card with an annual fee, although it doesn’t charge any annual fee for the first year you have. We felt we had to push the definition of no fee in order to include this card because of how insane its rewards are right now. One caveat: it’s only a great card for those who put more than $1,500 per month on their cards. If you do though, you’ll be swimming in rewards. You’ll earn 50,000 bonus points after spending $4,500 in the first 3 months. Then you’ll earn 2 miles per dollar you spend in restaurants and on travel (planes, boats, taxis, hotels) and 1 mile per dollar on everything else. All that is truly industry leading, but it gets even better: if you redeem the miles through Chase’s travel portal, you will get a 25% bonus, so the 50,000 miles becomes a jaw-dropping $625 in travel credit right off the bat, and the restaurants and travel rewards rate becomes worth 2.5 per dollar. Pretty incredible, and if you do spend above the $1,500 threshold, you’ll most likely find yourself wanting to keep the card past the first year in order to keep earning.
Most Appropriate For: Anyone who spends more than $1,500 using their credit cards. Anyone who wants to earn a staggering $625 new account bonus.
Least Appropriate For: Those who don’t spend enough to earn the big bonus, and wouldn’t spend enough to justify keeping the card past the first year.
The Verdict: A fantastic card, albeit mostly for the big spenders, and especially for the big spenders who spend in restaurants and while traveling.
Earning rewards using your credit cards is a fantastic thing: its like constantly finding lost money in your jacket pocket. Yet there’s no reason to pay an annual fee in order to use a top-paying miles reward card when you can get either the Discover it Miles in order to earn 3x miles during your first year, or the BankAmericard Travel Rewards in order to get a 20,000 new account bonus. But if you are willing to pay an annual fee, you’ll be hard pressed to beat the $625 new account bonus offered by the Sapphire Preferred.