You have a choice to get a card with an annual fee or one with a free annual fee. You might be asking: why would you get one where you have to pay something when there’s a free one available? After all, an annual fee can range from $49 to $550 for a credit card.
The annual fee will basically provide the cardholder more valuable purchase rewards and benefits than their ‘free’ counterparts. A good rule to follow your annual fee decision is how often you plan to use the card.
If you will be paying $49 for the card, you should earn at least $49 in rewards to break even and maybe profit from the rewards. If you plan on using the card sporadically, a no-fee card is better.
Many cash back cards do not charge an annual fee. This makes them a good option as a second card or a primary card for the budget-conscious. Besides the no annual fee benefit, all of the cards below offer rewards on everyday purchases.
Here are The Smart Investor Select’s picks for the top no-annual fee credit cards:
Card | Rewards | Bonus | Annual Fee | Best For |
| 1X – 2X
2X points at U.S. supermarkets (up to $6,000 per year, then 1X), 2X points on prepaid rental cars booked through American Express Travel and 1X points on all other purchases
| 10,000 points
10,000 points after you spend $2,000 in purchases on your new card within the first 6 months
| $0 | Everyday Purchases |
|---|---|---|---|---|---|
| None | None | $0 | Balance Transfer | |
| 1X – 4X
4x points at restaurants, take-outs & deliveries, 2x points at supermarkets, gas stations & streaming servicesm and 1 point for 1 dollar on all other purchases
| 20,000 points
20,000 bonus points when you spend $1,000 in eligible purchases within the first 90 days of account opening
| $0 | Rewards | |
| 1-3%
3% cash back rewards on trips booked through SoFi Travel. After that, earn 2% unlimited cash back on purchases when redeemed toward investing, saving, or paying down an eligible loan with SoFi
| N/A
N/A
| $0 | Flat Rate Cashback | |
| 1.5% – 5%
5% cash back on travel booked through Chase Ultimate Rewards, 3% on dining (including takeout and eligible delivery), 3% on drugstore purchases, and 1.5% on all other purchases
| $250
Earn a $200 bonus after you spend $500 on purchases in the first 3 months from account opening.
| $0 | Cashback on Travel | |
| 1% – 8%
unlimited 3% cash back on dining, entertainment, popular streaming services, and grocery store purchases (excluding superstores like Walmart® and Target®). You’ll also earn 1% on all other purchases. Plus, you get 10% cash back on purchases through Uber and Uber Eats, 8% on Capital One Entertainment purchases, and 5% on hotels and rental cars booked through Capital One Travel
| $250
$250 cash bonus once you spend $500 on purchases within the first 3 months from account opening
| $0 | Dining | |
| 1-3%
3% cash back in the category of your choice: gas, online shopping, dining, travel, drug stores, or home improvement/furnishings, 2% cash back at grocery stores and wholesale clubs and 1% cash back on all other purchases. The 3% and 2% cash back available on the first $2,500 in combined choice category/grocery store/wholesale club purchases each quarter (then 1%)
| $200
$200 cash rewards bonus after making at least $1,000 in purchases in the first 90 days of your account opening
| $0 | Rotating Categories |
Blue Cash Everyday® Card from American Express
Rates & Fees, Terms Apply
Blue Cash Everyday® Card from American Express
Reward details
Current Offer
Credit Rating
Annual Fee
0% Intro
APR
Rates & Fees, Terms Apply
The Blue Cash Everyday® Card from American Express is a no-annual-fee credit card that’s perfect for everyday spending. It offers great rewards, with 3% Cash Back at U.S. supermarkets / U.S. online retail purchases/ U.S. gas stations on up to $6,000 per year in purchases, then 1%.
The card provides a $200 statement credit after you spend $2,000 in purchases on your new Card within the first 6 months.
Additionally, it features a 0% introductory APR for 15 months on purchases and balance transfers from the date of account opening , followed by a variable APR of 18.49% – 29.49% Variable.
This card pairs this introductory APR with the Pay It Plan It program, allowing users to manage their payments efficiently.
While it stands out for its unique U.S. online retail reward category, it may not be the most lucrative option for those who spend heavily outside these specified areas.
- APR: 18.49% – 29.49% Variable
- Annual fee: $0
- Balance Transfer Fee: 3% or $5, whichever is greater
- Foreign Transaction Fee: 2.7%
- Rewards Plan: 3% Cash Back at U.S. supermarkets / U.S. online retail purchases/ U.S. gas stations on up to $6,000 per year in purchases, then 1%. Terms Apply.
- Welcome Bonus: $200 statement credit after you spend $2,000 in purchases on your new Card within the first 6 months
- 0% APR Introductory Rate period: 15 months on purchases and balance transfers from the date of account opening
- Competitive Rewards And Welcome Bonus
- No Annual Fee
- 0% Intro APR
- Foreign Transaction Fee
- Spending Caps
Are there any restrictions on redeeming cash back for direct deposits or checks?
Yes, unlike some other cards, the Blue Cash Everyday card doesn't allow for direct deposit or check redemptions.
What is the Pay It Plan It program?
The Pay It Plan It program allows cardholders to manage payments effectively, offering upfront payment options for qualifying purchases.
Does the Blue Cash Everyday Card have any exclusive perks?
Yes, cardholders enjoy exclusive access to American Express Experiences, providing special ticket presale access and event invitations.
Does the card offer any travel-related benefits?
Yes, cardholders have access to the Global Assist Hotline for emergency assistance when traveling more than 100 miles from home.
How can I redeem the cash back rewards?
Cash back rewards, earned as Reward Dollars, can be redeemed for statement credits with no minimum redemption amount.
PayPal Cashback Mastercard
Reward details
Current Offer
Credit Rating
Annual Fee
0% Intro
APR
The PayPal Cashback Mastercard, issued by Synchrony Bank, is a no-annual-fee cash-back credit card that offers straightforward rewards for PayPal users.
It gives 3% cashback when you shop with PayPal, 2% cashback on all other purchases, with no category restrictions or annual earnings limits.
The card requires applicants to have a PayPal account, which is free to open, and a good to excellent credit score for approval.
While lacking a welcome bonus or introductory APR offers, its cash rewards never expire, and there's no minimum redemption threshold. The redemption process is seamless, allowing users to transfer cash rewards directly to their PayPal balance.
- Rewards Plan: 3% cashback when you shop with PayPal, 2% cashback on all other purchases
- APR: 20.24% – 32.24% Variable
- Annual fee: $0
- Balance Transfer Fee: N/A
- Foreign Transaction Fee: 3%
- Sign Up bonus: N/A
- 0% APR Introductory Rate period: N/A
- Cash Rewards Never Expire
- Simplicity and Flexibility
- Cash Rewards Integration with PayPal
- No Minimum Redemption Threshold
- Requirement of a PayPal Account
- Limited Perks
- High APR
Does the card have an introductory APR offer?
No, the card does not offer introductory APR rates for purchases or balance transfers.
How can I redeem cash rewards from the PayPal Cashback Mastercard?
Cash rewards can be redeemed by transferring them to a PayPal account, where they can be used for PayPal purchases or transferred to a linked bank account.
Can authorized users earn the same cash back rates?
No, authorized users can earn up to 2% cash back on all purchases, less than the primary cardholder.
What credit score is required to apply for the card?
The card typically requires a good to excellent credit score for approval.
Can I redeem cash rewards for statement credits or gift cards?
No, the redemption options are limited to transferring cash rewards to a PayPal account or linked bank account.
Are there category restrictions for earning cash back?
No, the card eliminates category restrictions, offering a flat 2% cash back on all other purchases.
U.S. Bank Altitude® Go Visa Signature®
Reward Details
Current Offer
Credit Rating
Annual Fee
0% Intro
APR
The U.S. Bank Altitude® Go Visa Signature® Card is extremely beneficial to both new and existing customers.
Cardholders can earn 4x points at restaurants, take-outs & deliveries, 2x points at supermarkets, gas stations & streaming servicesm and 1 point for 1 dollar on all other purchases These points have no expiration date and can be redeemed whenever the account is open.
When you reach 2,500 points, you can either redeem them as statement credits or request that they be deposited into your account.
On purchases and balance transfers, there is a 0% introductory APR for 12 billing cycles on purchases and balance transfers, followed by a variable APR ranging from 17.74% – 28.74% Variable.
Finally, there are no annual fees or charges for shopping from international merchants because both are set at zero dollars.
- APR: 17.74% – 28.74% Variable
- Annual fee: $0
- Balance Transfer Fee: 3%
- Foreign Transaction Fee: $0
- Rewards Plan: 4x points at restaurants, take-outs & deliveries, 2x points at supermarkets, gas stations & streaming servicesm and 1 point for 1 dollar on all other purchases
- Sign Up bonus: 20,000 bonus points when you spend $1,000 in eligible purchases within the first 90 days of account opening
- 0% APR Introductory Rate period: 12 billing cycles on purchases and balance transfers
- High Rewards Rate & Sign Up Bonus
- No Annual Fee
- 0% Intro
- No Points Expiration
- High Credit Needed
How much is 10,000 points worth?
Points are available on the Altitude Go, and they are typically worth 1.5 cents each. This means that depending on your redemption method, 10,000 points could be worth $150.
Is it good credit card?
Given that the card has no annual fee, it provides some decent rewards. They are worth serious consideration if you are looking for an everyday card without having to worry about hefty annual fees.
Does the altitude card offer pre approval?
Pre-approval is available at US Bank, but only for offers received via email or mail. Furthermore, if you are an existing customer, you may receive a pre-approved offer via your online account. There is no online tool for interested potential customers to use to check the status of their pre-approval. When you complete the online application form, you are submitting a complete application, which will include a hard credit pull.
What are the card income requirements?
The Altitude Go card requires excellent credit, but one of the most important factors for U.S Bank is your credit rating rather than your income status.
Do the reward points expire?
You don’t need to worry about expiry dates. U.S Bank clearly states that the points for the Altitude Go card never expire.
Chase Freedom Unlimited®
Reward details
Current Offer
Credit Rating
Annual Fee
0% Intro
APR
The Chase Freedom Unlimited® card provides an enthralling combination of lavish rewards, including a 5% cash back on travel booked through Chase Ultimate Rewards, 3% on dining (including takeout and eligible delivery), 3% on drugstore purchases, and 1.5% on all other purchases.
It offers a nice sign-up bonus of Earn a $200 bonus after you spend $500 on purchases in the first 3 months from account opening..
Another benefit worth mentioning is the long 0% intro APR – 15 months on purchases and balance transfers (19.99 – 28.74% variable after that).
Overall, Chase Freedom Unlimited is one of the best options in the market, especially for those who are looking to save the annual fee.
- APR: 19.99 – 28.74% variable
- Annual fee: $0
- Balance Transfer Fee: $5 or 5%
- Foreign Transaction Fee: 3%
- Rewards Plan: 5% cash back on travel booked through Chase Ultimate Rewards, 3% on dining (including takeout and eligible delivery), 3% on drugstore purchases, and 1.5% on all other purchases
- Sign Up bonus: Earn a $200 bonus after you spend $500 on purchases in the first 3 months from account opening.
- 0% APR Introductory Rate period: 15 months on purchases and balance transfers
- Cash Back Rewards + Sign Up Bonus
- 0% APR on Balance Transfers & Purchases
- No Annual Fee
- Protection & Free Credit Score
- Balance Transfer Fee
- Foreign Transaction Fee
- Less Relevant For Frequent Travelers
- Is there a limit to cashback rewards? There is no cap.
- Can I get car rental insurance with a Chase Freedom Unlimited card? Yes, when you rent the car and pay for all of it with this card and do not accept coverage from the rental company.
- Should You Move to Chase Freedom Unlimited card? This is a good fit for people who are looking for no annual fee card including good cashback rates that do not change.
- Why did Chase Freedom Unlimited card deny me? You might not have met one of the requirements for this card. You can talk with a member of the customer support team to see what the issue is and how you might be able to rectify it.
- How hard is it to get a Chase Freedom Unlimited card? It is not very hard to get this type of card once you meet all of the straightforward requirements.
- How to maximize rewards on the Chase Freedom Unlimited card?
- You can choose between the options as to how you utilize the rewards. To maximize rewards, you should make the most of the signup bonus and also be aware of which of your credit cards have the best cashback for a particular type of purchase.
- Top reasons NOT to get the Chase Freedom Unlimited card? If you are looking for higher flat cashback rates. You may also travel a lot and not want to pay the 3% foreign exchange transaction charge that comes with this card.
- Does Chase ask for proof of income? There is no specific income requirements and it does not usually ask for proof of income requirements.
- Does the card offer pre-approval? Yes, you can get pre-approval.
- What is the initial credit limit? The initial credit limit varies, but can often be between $1,000 and $5,000.
- How do I redeem cashback? Go to the Ultimate Rewards section that Chase offers and you can choose between the options as to how you utilize the rewards.
- What purchases don't earn cashback with the Freedom Unlimited card? All purchases earn cashback with this card.
Upgrade Cash Rewards
Reward Details
Current Offer
Credit Rating
Annual Fee
0% Intro
APR
The Cash Rewards card by Upgrade offers unlimited 1.5% cash back on every purchase, providing a straightforward and rewarding experience.
Additionally, users can earn a $200 bonus by opening a Rewards Checking Plus account and completing three debit card transactions. This card boasts a lack of annual fees, offering credit lines ranging from $500 to $25,000.
The Upgrade Card combines the flexibility of a cash back rewards credit card with the predictability of a personal loan. Users can make purchases anywhere Visa is accepted, with the convenience of various payment methods, including swipe, tap, insert, or online transactions.
- APR: 14.99% – 29.99%
- Annual fee: $0
- Balance Transfer Fee: Up to 5%
- Foreign Transaction Fee: Up to 3%
- Rewards Plan: 1.5% cash back on payments
- Sign Up bonus: Earn $200 bonus after opening a Rewards Checking account and making 3 debit card transactions.
- 0% APR Introductory Rate period: N/A
- Cash Back Rewards
- Balance Transfer Alternative
- No Deposit Required
- Inflexible Payments
- No Grace Period
- Balance Transfer and Foreign Transaction Fees
Can I check if I qualify before applying?
Upgrade has a pre-approval feature on its website. You can enter some basic info to see if you qualify for Upgrade cards. It won't affect your credit, and you'll get a decision in minutes.
When can I reach Upgrade customer service?
Upgrade's customer service is available by phone on weekdays from 6 am to 6 pm and on weekends from 6 am to 5 pm (Pacific Time). You can also email them, but responses may take some time.
Is Upgrade's digital experience good?
While Upgrade offers a good product, some users find its website interface less user-friendly. It needs improvement in the digital experience for customers.
How long does approval take?
With Upgrade's pre-approval option, you can get a response in minutes, speeding up the approval process. Once approved, you can expect to receive your card within ten business days.
How soon will my credit score improve?
The time it takes for your credit score to improve depends on your situation and financial habits. Upgrade provides free credit monitoring tools, helping you track improvements in your score.
Does the card report to all credit bureaus?
Yes, Upgrade reports your activity to the credit bureaus after you open your account.
Citi Custom Cash℠ Card
Reward details
Current Offer
Credit Rating
Annual Fee
0% Intro
APR
The Citi Custom Cash® Card stands out as a versatile cash back option, offering a unique rewards program that eliminates the need for tracking categories or activation periods.
With no annual fee, it provides 5% cash back on your highest eligible spend category each billing cycle up to the first $500 spent and 1% cash back thereafter.
The card's 0% APR for 15 months on purchases and balance transfers on purchases and balance transfers, whichadds to its appeal, though rates range from 18.49% – 28.49% (Variable) after the introductory period.
However, it has limitations, such as a 5 percent bonus category spending cap, potential difficulty in tracking bonus categories, and a focus on a single category each billing cycle.
- APR: 18.49% – 28.49% (Variable)
- Annual fee: $0
- Balance Transfer Fee: $5 or 5% (the greater)
- Foreign Transaction Fee: 3%
- Rewards Plan: 5% cash back on your highest eligible spend category each billing cycle up to the first $500 spent and 1% cash back thereafter
- Sign Up bonus: $200 cash back after you spend $1,500 on purchases in the first 6 months of account opening (20,000 ThankYou® Points, which can be redeemed for $200 cash back)
- 0% APR Introductory Rate period: 15 months on purchases and balance transfers
- High Cash Back Rate
- 0% Intro APR
- Sign-Up Bonus
- No Annual Fee
- Balance Transfer Fee
- Low Cap on Higher Cashback
- Foreign Transaction Fee
Can I get car rental insurance with Citi Custom Cash Card?
Yes, it offers rental insurance for cars if you pay for the full cost with this credit card and you decline the rental company’s insurance.
Is there a cash-back rewards limit?
Besides the cap on specific categories, there is no limit in place with this card on how many total rewards you can earn. Therefore, people who will be spending large sums on purchases can ideally take advantage of this offering.
What is the initial credit limit?
The initial credit limit will usually be $500 for this card. The exact limit that will be in place will depend on your financial situation (can be much higher).
Should You Move to Citi Custom Cash Card?
If you don't tend to spend more than $1,000 – $1,500 every month and you tend to spend them on specific categories, this card can be a perfect fit due to the high cashback on the your top category.
What purchases don't earn cash back?
All purchases earn cashback as a result of using this card. Therefore, you will be able to take a very flexible approach and know that you will always be able to earn reward no matter the type of purchase.
How to maximize rewards on Citi Custom Cash Card?
Make sure that you avail of the signup bonus and that you maximize the 5% cashback offering each cycle. This will allow you to get the best bang for your buck.
Capital One SavorOne Cash Reward
Reward Details
Current Offer
Credit Rating
Annual Fee
0% Intro
APR
The Capital One SavorOne Cash Rewards Credit Card has no annual fee and allows you to earn cash back rewards on everyday purchases.
You can earn an unlimited unlimited 3% cash back on dining, entertainment, popular streaming services, and grocery store purchases (excluding superstores like Walmart® and Target®). You’ll also earn 1% on all other purchases. Plus, you get 10% cash back on purchases through Uber and Uber Eats, 8% on Capital One Entertainment purchases, and 5% on hotels and rental cars booked through Capital One Travel.
In addition, you are eligible for 15 months on purchases and balance transfers to help you pay down an existing balance or pay off new purchases gradually, 19.74% – 29.74% (Variable) after that.
On the downside, this card requires good – excellent score and it charges a balance transfer fee of 3%.
- APR: 19.74% – 29.74% (Variable)
- Annual fee: $0
- Balance Transfer Fee: 3%
- Foreign Transaction Fee: [$0
- Rewards Plan: unlimited 3% cash back on dining, entertainment, popular streaming services, and grocery store purchases (excluding superstores like Walmart® and Target®). You’ll also earn 1% on all other purchases. Plus, you get 10% cash back on purchases through Uber and Uber Eats, 8% on Capital One Entertainment purchases, and 5% on hotels and rental cars booked through Capital One Travel
- Sign Up bonus: $250 cash bonus once you spend $500 on purchases within the first 3 months from account opening
- 0% APR Introductory Rate period: 15 months on purchases and balance transfers
- Sign Up Bonus & Cash Back Rewards
- 0% Intro APR
- No Annual Fee
- Balance Transfer Fee
- Approval Can Be Strict
- No Travel Rewards
Can I get car rental insurance with SavorOne Card?
Yes, once you refuse the insurance offered by the rental company you will automatically get coverage if you fund the entire purchase through this card. Please review the terms and conditions before to make sure you're covered.
Does SavorOne Card ask for proof of income?
No out and out request for proof of income and no transparent income requirements.
Can I get pre-approved?
Yes, pre-approval is possible.
What is the initial credit limit?
The credit limit will be at least $500, and can be higher depends on your credit score.
How do I redeem cash back?
You can get them sent to you in the form of a check, as a statement credit, or get them given to you through gift cards.
Why did SavorOne Card deny me?
You might not have met all of the requirements. You can enquire as to where your application fell short. If you cannot proceed, you can look at some of the other available options
How to Use SavorOne card Benefits?
Use this card for the premium cashback types of purchases and maximize the signup offer.
What are top Reasons NOT to get the SavorOne Card?
If you can get better cashback rates elsewhere in equally as a cost-effective manner.
Bank of America® Customized Cash Rewards credit card
Reward details
Current Offer
Credit Rating
Annual Fee
0% Intro
APR
If you are looking to have a bit more control over what categories in which you are going to be earning rewards, the Bank of America® Customized Cash Rewards could be for you. You are able to choose the category in which you get spending rewards.
You will be able to earn 3% cash back in the category of your choice: gas, online shopping, dining, travel, drug stores, or home improvement/furnishings, 2% cash back at grocery stores and wholesale clubs and 1% cash back on all other purchases. The 3% and 2% cash back available on the first $2,500 in combined choice category/grocery store/wholesale club purchases each quarter (then 1%).
The signup offer allows you to get $200 cash rewards bonus after making at least $1,000 in purchases in the first 90 days of your account opening. Another great advantage of this card is that you do not have to pay an annual fee.
- APR: 18.74% – 28.74% Variable APR on purchases and balance transfers
- Annual fee: $0
- Balance Transfer Fee: 3% or $10
- Foreign Transaction Fee: 3%
- Rewards Plan: 3% cash back in the category of your choice: gas, online shopping, dining, travel, drug stores, or home improvement/furnishings, 2% cash back at grocery stores and wholesale clubs and 1% cash back on all other purchases. The 3% and 2% cash back available on the first $2,500 in combined choice category/grocery store/wholesale club purchases each quarter (then 1%)
- Sign Up bonus: $200 cash rewards bonus after making at least $1,000 in purchases in the first 90 days of your account opening
- 0% APR Introductory Rate period: 15 billing cycles for purchases, and for any balance transfers made within the first 60 days of opening your account.
- Sign-Up Bonus
- 0% APR Intro
- No Annual Fee
- Bash Back Rewards
- Cap on Rewards
- Balance Transfer Fee
- Foreign Transaction Fee
- Is there a limit to cash back rewards? There is a quarterly limit on the 3% and 2% cashback each quarter, equalling a combined total of $2,500 worth of purchases.
- Can I get car rental insurance with Bank of America Cash Rewards Card? Yes, it offers rental insurance for cars if you pay for the full cost with this credit card and you decline the rental company’s insurance.
- Does Bank of America ask for proof of income? No out and out income requirements and normally you will not have to provide proof of income.
- Can I get pre-approved? Yes, you can get pre-approved.
- Should You Move to Bank of America Cash Rewards Credit Card? If you spend a lot on everyday purchases it can definitely be a good option.
- Why did Bank of America Cash Rewards Card deny me? Perhaps you did not meet all of the requirements. You can ask the customer service team what you need to do to get accepted or you can look at other card options.
- How to maximize rewards on Bank? Make the most of the signup offer and max out the caps on quarterly purchases at the premium rates.
- What are top reasons NOT to get the Bank of America Cash Rewards Card? If you spend a considerable amount on relevant purchases each month.
- What is the initial credit limit of? It will usually be at least $500
- What purchases don't earn cash back? All purchases are covered
No Annual Fee Cards - Basics
What Does No Annual Fee Mean?
No Annual Fee credit cards are exactly what they sound like, credit cards that don’t have an annual fee for cardholders. That means that you can have these cards without any additional charges.
Credit card providers usually use annual fees for their cards to help cover the cost of the card’s rewards system.
Fortunately, a lot of no annual fee credit cards still have great rewards systems, so you don’t have to pay for a premium card to get good benefits from your card.
About 74% of all credit cards have no annual fees.
When choosing a credit card, it’s important to consider the fee structure. According to data from creditcards.com, late payment fees are the most common, followed by cash advance fees. On the other hand, over-limit fees and annual fees are less common. This underscores the importance of making timely payments—not only does it help you avoid unnecessary fees, but it’s also essential for building a strong credit history.
No annual fee cards are still able to charge other kinds of fees, like late fees and overcharge fees. So it's not that these cards are fee-free, just that you don’t have to pay an annual charge for having them.
It’s important to pay attention to the other charges included with your no annual fees credit cards because some companies raise the cost of other fees to make up for the lack of an annual fee.
How To Compare No Annual Fees Cards?
Knowing how to compare no annual fees credit cards is critical for making sure you’re getting the right card for your needs. Here are some of the more important features you need to consider.
- Intro APR: Introductory APR (Annual Percentage Rate) is often used by financial institutions to make their credit cards more appealing for new clients. However, you should remember that low introductory rates can sometimes disguise higher rates and fees after the first 6 months to a year.
- Ongoing APR: The ongoing APR of your credit card reflects the real cost of the card. Many no annual fees credit cards have a comparatively high APR after the introductory rate has passed. So, it’s important to compare the ongoing APR of different options to find a more affordable and valuable credit card offer.
- Rewards Quality: Some no annual fees credit cards don't offer much in the way of a good rewards program, but there are a few cards that have solid rewards. Look for programs that offer high cash back, fast points accrual, or that provide a significant discount at certain stores or for specific kinds of purchases.
- Sign Up Bonus: Not every credit card will offer a sign-up bonus, so it’s not a requirement to find a credit card that has a good one. Sign-up bonuses are great when they don’t hide unfavorable terms and conditions, but an overly generous signing bonus should make you look carefully at the other details of the card.
- Fees: Almost all credit cards have some fees associated with them, but you don’t want to get stuck with a card that will nickel and dime you for using it. Look for cards with low fees, especially low-interest rates, low overcharge fees, and low late payment fees.
- Does the Card Accept Balance Transfers? Balance transfers can be an important part of money management, especially if you already have credit card debt. You might not always need this feature, but it’s important to know whether it’s an option before you sign up.
- Source of the Credit Card: Most people get a lot of credit card offers, but those cards usually aren’t the best offer you’re eligible for. Pay attention to the bank or financial institution making the offer.
Drawbacks of No Annual Fees Cards
Of course, there are some drawbacks to the no annual fees credit card model. Financial institutions exist to make a profit, so even though they also want to offer high-quality products that help their customers.
- High APR
The main drawback of no annual fees cards is that they tend to have higher interest rates than other kinds of credit cards. The interest rate is where the financial institution makes most of its profit.
Higher interest rates aren’t the only drawback of no annual fees credit cards though.
- Fees
No annual fees credit cards also usually come with higher fees, which is why it’s so important to know what fees your credit card can charge and how to avoid them.
It’s also common for no annual fees cards to charge more fees than other kinds of credit cards. That means that it will be harder for you to avoid your credit card fees entirely.
Similarly, no annual fees credit cards tend to have smaller sign-up bonuses and less valuable introductory rewards.
That means that there is less incentive to sign up for these cards and can mean that they are less attractive options for balance transfers.
- Lower Rewards
It’s also worth noting that most no annual fees credit cards have less generous reward systems than credit cards with annual fees.
When To Consider a No Annual Fees Card?
No Annual Fees credit cards are almost certainly the cheapest option for consumers, at least at first. They are a good option for people who are looking for an affordable credit card that doesn’t cost a lot to use.
- You need to build credit
No annual fees credit cards are also usually a good option for people who are looking to build their credit scores.
This isn’t the same as trying to recover bad credit. Consumers with bad credit scores likely aren’t eligible for no annual fees credit cards with other good features and terms of use.
But first-time credit card users and people with moderate credit scores usually quality for reasonable no annual fees credit cards.
- Your spend doesn't cover the annual fee
It’s also important to think about how much you’re likely to use your credit card. Consumers who are going to use their credit card a lot, especially with high balances, may be better off with a card that has annual fees compared to a no annual fee credit card.
That’s because high-use consumers will generally make back the cost of the annual fee in higher rewards returns. However, if you need a credit card for small purchases, minimal use, or to carry as an emergency-only credit card, a no annual fees credit card is likely a good option.
- Your don't need travel rewards
No annual fee credit cards are usually best for people who aren’t likely to travel very often since cards with annual fees almost always offer better travel bonuses and mileage rewards.
Travel cards are designed for users who are jetsetters and spend a lot of time traveling from place to place. They tend to make traveling cheaper and have travel-related rewards and discounts to help minimize your costs.
How We Picked The Best No Annual Fee Cards: Methodology
To identify top credit cards offering no annual fee credit cards, our team researched hundreds of cards, issued by major banks, credit unions, and fintech companies. Independently, our experts meticulously analyzed data to generate ratings and ranking based on four categories tailored for no annual fee cards:
Card Rewards (40%): We assess the rewards structure, including cash back percentage on purchases, bonus categories, and redemption options. Cards with higher rewards rates, flexible redemption choices, and enticing sign-up bonuses score higher.
Card Features (30%): This category evaluates features such as 0% intro APR offers, absence of foreign transaction fees, and additional perks like travel insurance or purchase protection. Cards offering valuable benefits without annual fees and competitive introductory rates earn higher scores.
Cardholder Experience (20%): We examine application ease, customer service quality, and online account management tools. Cards with responsive customer support, user-friendly mobile apps, and streamlined application processes receive higher ratings.
Issuer Reputation (10%): Each issuer's reputation is scrutinized, considering customer feedback, financial stability, and regulatory standing. Issuers with positive customer reviews and a history of responsible practices receive higher ratings.
