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The Best Rewards Credit Card

  • April 12, 2018 - We've updated this review again after another close look at offers and reward rates. The U.S. Bank Cash+™ Visa Signature® Card has replaced the Blue Cash Preferred® Card from American Express as our pick for cash back. We also swapped out our old Best for Airline Rewards picks with a card that isn't airline specific, but offers better overall value.
  • January 24, 2018 - Credit card offers and rewards are frequently changing, so we’ve updated this review with more recent offers from our top picks. We also replaced our former pick for Best Airline Rewards, as the program was closed at the end of 2017; in its place, we recommend the United MileagePlus® Explorer Card.

Choosing the best rewards credit card comes down to your spending habits and reward preferences. After all, not all cards offer the same type of rewards. However, we narrowed it down to five types that will offer the best potential value for most people. We’re confident our top picks are the best available, but only you can decide what your needs and spending habits are.

The U.S. Bank Cash+™ Visa Signature® Card is our top pick for a cash-back rewards card. It’s a rotating card, meaning you earn better rewards on specific spending categories each quarter. However, the card allows you to choose from the available categories, so you can target your common expenses and maximize your rewards — unlike most rotating cards, which choose for you. For example, you earn 2% cash back for everyday expense categories such as gas or groceries. The rate increases to 5% back for additional expense categories ranging from cell phone bills to gym memberships. The good part: Reward rates are high, and customizing your spending categories can lead to greater rewards in the long run. The best part? The rewards are cash-based, which means you can use them on any expense you want. In short, this card provides the best long-term value for most people who want a rewards card.

If you spend a large amount of money on gas and groceries, we recommend the Blue Cash Preferred® Card from American Express. It offers an unlimited 3% cash back on gas and 6% back on groceries (up to $6,000 before dropping to 1%) throughout the entire year. No other rewards card we compared offered the same reward rate for these two common expenses. That said, all of your other purchases only earn you 1%, and you’ll be charged a $95 annual fee. The U.S. Bank Cash+ card provides better all-around value, but for families, commuters, or anyone who frequently spends on gas and groceries, the Blue Cash Preferred® is a great companion card and excellent investment.

For those who travel, the Capital One® Venture® Rewards Credit Card is tough to beat. You earn 2x miles per dollar on every purchase, which you can put toward travel expenses. Add to that a sign-up bonus of 50,000 points (a $500 value) for spending $3,000 in the first three months and you can book your next trip in no time. Additional perks, like 10x miles for every dollar spent on hotel bookings, ensure the card offers long-term value. You’ll have to pay the standard $95 annual fee, but it’s waived for the first year. If you don’t travel at least once a year, a cash-back card will be a better investment, but for frequent travelers the Capital One® Venture® Rewards is a smart choice.

Particularly frequent flyers will want the Chase Sapphire Preferred® Card. Cardholders can earn 2x points for dining and travel-related expenses with any travel company rather than being restricted to a specific airline. The card even offers a 25% boost to your points when redeeming through Chase Ultimate Rewards. You also have the option of transferring your points to an airline loyalty program, allowing you to choose the redemption method that offers the best deal. General travelers will still want a Capital One® Venture® Rewards, because the spending requirement for the Chase card’s 50,000-point sign-up bonus is a steep $4,000, and the high reward rates are limited to dining and travel-related expenses only. But for frequent flyers or travelers who spend significant money on plane tickets each year, this card takes the crown.

Most rewards cards don’t grant approval if you have zero credit or a low score. The Discover it® Secured Card, on the other hand, does. It’s actually designed to help cardholders build their score while earning them rewards. The card will offer 2% cash back on restaurant or gas purchases and 1% on all other expenses. But the big draw is the cashback match — Discover will match all the rewards you earn at the end of your first year. The drawback? Your spending limit or credit line will also match the security deposit you put down as collateral. You’ll need a minimum of $200, but can get approved for a deposit of up to $2,500 depending on your income and ability to pay. This puts a limit on your potential rewards, but it also protects you from carrying a balance and hurting your credit score. Simply put, this card provides one of the best paths toward building or rebuilding credit scores.

Our Top Picks for Best Rewards Card

Best for Cash Back
The U.S. Bank Cash+™ Visa Signature® Card
U.S. Bank
Customizable reward categories and strong reward rates make this card a great choice for cash rewards and long-term value.

The U.S. Bank Cash+™ Visa Signature® Card is a rotating cash-back card — each quarter, spending categories that earn you boosted rewards change. But while most rotating cards pick bonus categories for you, the U.S. Bank card lets you choose. That means you can target the categories that best match your spending habits for maximum value.

Customizing your bonus categories comes in two flavors: You can choose one everyday category (e.g. gas or groceries) for 2% cash back as well as two other 5% cash back categories for other expenses. The 5% categories can include anything from cell phone bills to gym memberships. You can even switch categories at any time to match your spending needs, just as long as the new quarter is more than five days away. More importantly, the ability to mix and match categories means there is a much lower risk of being locked into a predetermined category that doesn’t match your expenses.

Of course, there are a few limits and drawbacks. For starters, you need to remember to activate your bonus categories each quarter to receive the higher reward rate — just like any other rotating cash-back card. And the 5% categories only offer the bonus rate for the first $2,000 in purchases. However, competitors like the Discover it® card and Chase Freedom® card only provide a 5% boost for $1,500 of expenses each quarter. Plus, the ability to customize your spending categories encourages you to stay on top of activation, and U.S. Bank will send you a reminder each quarter.

Other than that, the card meets the standards of an excellent cash-back card. You can receive a $150 bonus for spending $500 in the first 90 days of approval, and a $25 cash bonus the first time you redeem $100 or more in a single redemption. There’s no annual fee, which means more money and rewards in your pocket. For those who want a customizable cash-back card for long-term value, the U.S. Bank Cash+™ Visa Signature® Card is a solid choice.

  • 5% cash back on your first $2,000 in combined eligible net purchases each quarter on two categories you choose.
  • 2% cash back on your choice of one everyday category, like gas or groceries, 1% cash back on everything else
  • Earn $150 cash back after you spend $500 in eligible net purchases in the first 90 days you have the card
  • Unlimited cash back
  • No annual fee

Best for Gas and Groceries
Blue Cash Preferred® Card from American Express
American Express
No other card we compared came close to beating this card’s reward rates of 3% cash back on gas and 6% on groceries.

Most cash-back cards give you opportunities to earn boosted rewards for gas and groceries. After all, the two categories are common expenses for most people. But the Blue Cash Preferred® Card from American Express is our favorite card for gas and groceries for one reason: It offers the best rewards for both expenses.

For starters, the card earns you a solid 3% cash back on gas throughout the year. As for groceries, you earn an impressive 6% cash back on up to $6,000 in purchases per year before dropping to 1% — the rate for all other purchases. A rotating cash-back card can earn you up to 5% back on both categories but only up to $1,500 during specific quarters of the year. In other words, the Blue Cash Preferred® Card is tough to beat if gas and groceries are a large part of your expenses.

Most people spend less than $6,000 on groceries.According to the Bureau of Labor Statistics, the average household only spent around $4,000 on groceries in 2016.

The card has a few restrictions. The gas and grocery bonus doesn’t apply to purchases made at popular warehouses or superstores (Costco, Sam’s Club, Wal-Mart or Target). You’ll need to visit a dedicated grocery store or gas station in order to receive the rewards. In addition, the card is issued by American Express, which has the lowest merchant acceptance rate across the United States — you’ll want to keep a backup card on hand. That said, the customer base is growing and acceptance rates are rising, and most major gas and grocery brands accept the card.

The card has a few other imperfections. Unlike other cash-back cards, the Blue Cash Preferred® also has an annual fee of $95. As with all rewards cards, make sure your fees aren’t greater than your rewards. But the card has benefits such as an additional 3% cash back on purchases made through department stores and a $200 statement credit for spending $1,000 in the first three months, which offset those other weaknesses. For families or commuters who need a specialized card for extra rewards on gas and groceries, the Blue Cash Preferred® Card from American Express is a wise investment.

  • $200 statement credit after you spend $1,000 in purchases on your new Card within the first 3 months.
  • 6% cash back at U.S. supermarkets (on up to $6,000 per year in purchases, then 1%) – that means spending $60 a week at U.S. supermarkets could earn over $180 back per year.
  • 3% cash back at U.S. gas stations and at select U.S. department stores, 1% back on other purchases.
  • Low intro APR: 0% for 12 months on purchases and balance transfers, then a variable rate, currently 14.49% to 25.49%.
  • Expanding merchant acceptance: Over 1 million more places in the U.S. started accepting American Express® Cards in the last year.
  • $95 annual fee.
  • Cash back is received in the form of Reward Dollars that can be easily redeemed for statement credits, gift cards, and merchandise.
  • Terms Apply.
  • See Rates & Fees

Best for Travel
Capital One® Venture® Rewards Credit Card
Capital One
With 2x the miles for every purchase and a low annual fee, this card is an exceptional value for travelers.

The competition was close between Capital One® Venture® Rewards Credit Card and the Chase Sapphire Preferred® Card, but Capital One edged out a victory with better reward rates, offering 2x miles on every purchase, not just travel-related expenses. In other words, the earning potential of the Capital One card is more flexible, which means you can earn more rewards on all of your expenses throughout the year — not just when you’re traveling.

Spending $3,000 within the first three months of approval will net you 50,000 bonus miles (a $500 value). Chase Sapphire Preferred® Card offers the same bonus, but only after you spend $4,000. Higher spending cutoffs increase the chance of carrying a balance and paying interest, which can devalue the rewards you earn.

Granted, the card still has its flaws. We were disappointed to see that the it only offers protection for travel accidents. Most competitors provide additional travel protections for lost luggage and trip cancellations, so the exclusion struck us as strange. That said, the card gives you access to unique travel perks, including an extra 10 miles per dollar for hotel bookings made through the Venture card hotel portal. Overall, though, the reward potential of the card outweighed its flaws.

A low annual fee of $95 (waived the first year) rounds out the excellent travel card. For a deeper look at travel cards and why the Capital One® Venture® Rewards Credit Card is our favorite, you can check out our detailed review of the best travel credit cards. But in simple terms, the rewards card is a solid investment if you want a balanced travel card with great value.

  • Enjoy a one-time bonus of 50,000 miles once you spend $3,000 on purchases within 3 months from account opening, equal to $500 in travel
  • Earn unlimited 2X miles per dollar on every purchase, every day
  • New! Earn 10 miles per dollar on hotels when you pay with your Venture card at hotels.com/venture; learn more at hotels.com/venture
  • Fly any airline, stay at any hotel, anytime
  • Travel when you want with no blackout dates
  • Miles won’t expire for the life of the account and there’s no limit to how many you can earn
  • No foreign transaction fees
  • $0 intro annual fee for the first year; $95 after that

Best for Airline Rewards
Chase Sapphire Preferred® Card
Chase
A reward rate of 2x points for a variety of travel expenses and flexibility when redeeming make this card a smart investment for frequent flyers.

We’ll be upfront: The Chase Sapphire Preferred® Card is a bit of an oddball pick because isn’t tied to any one specific airline. That means it won’t give you access to airline-specific perks such as waived baggage fees or priority boarding. Even so, a high reward rate and ability to boost your points for maximum value actually make it the best card for frequent flyers.

In fact, we consider the lack of a partner airline a strength. Co-branded or airline-specific cards only offer boosted reward and redemption rates for purchases made through a particular airline or its partners. With the Chase card, you earn 2x points for any travel-related expense and can redeem your rewards with any airline, hotel, or rental car company you choose. If you redeem through Chase Ultimate Rewards, you can boost your points by 25%. In other words, 50,000 points (a $500 value) would become 62,500 points (a $625 value).

The Chase card also lets you transfer points to a co-branded airline card account at a 1:1 rate. Translation? You can combine your Chase points with the rewards you earn from a loyalty program or airline card. That gives you the freedom to choose the redemption method that gives you the best value whether it’s through an airline program or Chase Ultimate Rewards. That means the Chase Sapphire Preferred® card can save frequent flyers a lot of money, and any airline-specific card or account you pair with it is icing on the cake — for recommendations on airline-specific cards, check out our in-depth review.

Of course, the card has a few shortcomings. Transferring points can be a complicated process, and the sign-up bonus requirement is steep. You need to spend $4,000 within the first three months to earn 50,000 bonus points, which is a high requirement if you don’t travel frequently (the Capital One® Venture® Rewards card will be a better bet for smaller spenders). But if you spend a substantial amount on flights or travel, the potential rewards and bonus are a great value. Add to that a low annual fee of $95 (the first year is free), and the Chase Sapphire Preferred® Card is the card to own for those who fly or travel often.

  • Earn 50,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That’s $625 toward travel when you redeem through Chase Ultimate Rewards®
  • Chase Sapphire Preferred® named a ‘Best Travel Credit Card’ by MONEY® Magazine, 2016-2017
  • 2X points on travel and dining at restaurants worldwide & 1 point per dollar spent on all other purchases.
  • Earn 5,000 bonus points after you add the first authorized user and make a purchase in the first 3 months from account opening
  • No foreign transaction fees
  • 1:1 point transfer to leading airline and hotel loyalty programs
  • Get 25% more value when you redeem for travel through Chase Ultimate Rewards. For example, 50,000 points are worth $625 toward travel.
  • No blackout dates or travel restrictions – as long as there’s a seat on the flight, you can book it through Chase Ultimate Rewards

Best for Low Credit
Discover it® Secured Credit Card - No Annual Fee
Discover
For easy and low-risk rewards while building your credit score, this card is tough to beat.

The Discover it® Secured Credit Card is our top pick for those who have zero credit or low scores. As a secured rewards card, it is designed to help build or rebuild your credit and reward you along the way. But the card stands out for having an impressive rewards rate and excellent first-year bonus.

The card earns you 2% cash back at restaurants or gas stations on up to $1,000 in purchases in each quarter and an unlimited 1% cash back on all other purchases. There’s also no annual fee, and Discover will match all the cash back you earn at the end of the first year — one of the best bonuses available for new cardholders. When it comes time to redeem your rewards, you can receive them in cash or Amazon credit. And with the card’s strong rewards rates and a straightforward redemption process, you can focus on building your credit rather than worrying about whether you’re getting the maximum value out of your card.

Be aware that there will be limits on your spending. The card requires a security deposit of at least $200 as collateral to open an account, and your spending limit or credit line cannot be greater than your deposit. Your maximum deposit or credit limit is also determined by income and ability to pay — it maxes out at $2,500, which is relatively low compared to standard cards. Low spending limits put a cap on your rewards, but that isn’t necessarily a bad thing; it protects you from running up a large balance that could hurt your credit score.

The best way to use the card is on common expenses that you’re confident you can pay off in full and on time every month. This will prevent you from paying the high interest rate of nearly 24.5%. At first glance, the interest seems counterintuitive for building credit. But it encourages spenders to pay their bills, and Discover waives the first late fee and won’t raise the rate if you pay late. After eight months, Discover will even start evaluating your account every month to see if you have been using your card responsibly and are eligible for an upgrade.

If you want to learn more about low credit options, we recommend checking out our detailed review on credit cards for bad credit. But the bottom line? The Discover it® Secured Card is a great choice for a clear path toward a better credit score and rewards card — such as our other top picks.

  • No Annual Fee, cash back on every purchase, and helps you build your credit with responsible use.
  • Your Secured Credit Card requires a refundable security deposit up to the amount we can approve of at least $200 which will establish your credit line. You will need to provide your bank information when submitting your security deposit.
  • We will automatically begin reviewing your account starting at 8 months to see if we can transition you to an unsecured line of credit.
  • Earn 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases each quarter, automatically. Plus, earn unlimited 1% cash back on all other purchases – automatically.
  • Get a dollar-for-dollar match of all the cash back you’ve earned at the end of your first year, automatically.
  • Receive FREE Social Security number alerts-Discover will monitor thousands of risky websites when you sign up.

A Refresher on Rewards Card Categories

Cash-back cards are usually split into two sub-categories: rotating and flat-rate cards. Rotating cards usually offer boosted reward rates of around 5% on predetermined spending categories (e.g. restaurants or gas) during specific quarters of the year — but only 1% on all other purchases. Flat rate cards offer around 1.5-2% cash back on all spending categories for the entire year. More importantly, cash-back rewards cards give you money back for your purchases. The rewards usually come in the form of statement credits, direct deposits, or even checks — no need to convert miles or points. Plus, cash is universal, so you have no restrictions on how you use rewards, unlike those you earn with travel or airline cards. That said, cash-back cards aren’t the best match for international travel — most charge foreign transaction fees, which can counteract your rewards. But if you don’t travel often or want the most versatile rewards, a cash-back card is the way to go.

Gas and grocery cards are a good match if you spend a substantial amount of money on those two expenses. Typically, the best are cash-back cards that provide high reward rates for money spent on gas and groceries. But only those two categories — you can expect around 1% cash back for all other purchases. A general cash-back card is better for most, but gas and grocery cards can be a smart investment if you feed a large family or have a long commute.

Travel rewards cards earn you miles or points that you can put toward future travel expenses. Some offer cash back rewards as well, but you get the best value when redeeming for flights, hotels, or rental cars. For frequent travelers or those who take big annual trips, a travel card can be a smart choice. We have a few favorites, and you can see how we chose them in our review of the best travel credit cards. But if you don’t travel frequently, a cash-back card will provide rewards that are easier to use.

Airline credit cards are a type of travel card but are co-branded. That means you can only earn and redeem points with the airline that is tied to your card (or its partners such as affiliate hotels or restaurants). If you spend a substantial amount of time on a particular carrier, an airline card is worth a look. That said, redeeming points or miles for flights is a bit complicated — ticket prices, the time of year, and the airline you choose can all affect your redemption value. But if you’re loyal to an airline, you can check out our top picks for each major airline in our review.

Low-credit or secured rewards cards are designed to help you rebuild credit while still offering rewards. Most are secured cards — they require you to put down a security deposit to cover your purchases if you fail to make a payment. This protects your credit score. However, your spending limit will match your deposit, which means the potential value of rewards is lower. But a secured card is a good way to enjoy a few rewards while working toward a better option.

All that’s left is choosing the best card in the category that matches your spending habits and reward preferences. If you fall between two categories, we recommend going with the card with rewards you will be most likely to use. “The best rewards cards are the ones where you’re actually engaged in the program and realize tangible benefits rather than just racking up a lot of points or miles that you’ll rarely use,” Ulzheimer explains.

For most, a general cash-back or travel card will be the best starting point and offer the most value. To see our top pick in each category, you can jump back up to our reviews of the best rewards cards.

You Can Combine Cards to Boost Rewards

One way to maximize rewards is to combine different types of rewards credit. Although you can really combine any two (or more) rewards cards (cash-back + travel, cash-back + airline, travel + airline) you want to ensure that the combination works in your favor.

For example, if you spend a significantly large amount on groceries, you could pair the Blue Cash Preferred® card with other competitors like the Chase Freedom® Card to improve the reward capacity of grocery expenses. Simply use the Chase card when groceries are the selected category for maximum rewards points. When groceries rotate out of the Chase rewards category, use the American Express card to get more rewards points, for boosted rewards on up to $7,500 in total purchases rather than $6,000.

That said, not all cards will pair well with others, and finding the right combination takes experience and patience. It also requires a lot of math that takes into account your spending habits and total annual fees. We encourage mixing and matching, but we focused on finding the best cards in each category that provide great value on their own.

Keep an Eye on Fees

No matter what card or combination of cards you choose, you will want to make sure that you’ll be able to pay any fees or balances without cutting into your rewards. In some cases, a high annual fee is worth it. Three of our top picks have annual fees, but as John Ulzheimer, formerly of FICO, explained “Most higher-end rewards cards are going to have annual fees, and that’s just a nature of their business. Annual fees shouldn’t be deal breakers, especially if you’re getting benefits that outweigh the fees.” We stuck to cards with $95 fees, which is pretty standard among the industry.

No Interest

We recommend avoiding interest altogether by paying off your balance in full and on time each month. But we realize that isn’t always possible, so if you plan on carrying a balance, just make sure any interest you pay doesn’t counteract the bulk of your rewards. Dan Crimmins, financial coach with Crimmins Wealth Management and author of award-winning financial blog Roots of Wealth, advised us to look at the fine print: “Before exploring the rewards that some cards offer, you should look at the annual fee, the introductory APR, and the ongoing APR. Be aware of ‘teaser’ rates offered if you will be carrying a balance beyond the introductory time period.”

In the case of our top picks, we’ve gone over the fine print to make sure there aren’t any surprise “gotchas,” but this is often where other types of rewards cards — especially retail rewards cards — get people in trouble. “Yes,” the sales clerks say, “you can save 15% on your purchase if you sign up for a credit card right now, and you’ll earn two points on every dollar you spend at our store.” What they don’t tell you is that your new credit card may charge 25% interest.

Some cards have set interest or Annual Percentage Rates (APR) while others rely on your credit score to determine your APR — the higher your score, the lower the rate. Rewards cards generally have high rates of around 16-25%, which is the price you pay for their benefits. But again, paying off your balance on time removes the expense.

Our Rewards Credit Card Review: Summed Up