Credit Cards » Compare Credit Cards » The Best Rewards Credit Cards of November 2022
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The Best Rewards Credit Cards of December 2022

Find the right rewards credit card for you, based on your spend and needs - whather it's cash back, points or miles. Compare our best picks.
Author: Lorraine Smithills
Lorraine Smithills

Writer, Contributor

Experience

Lorraine is a freelance finance writer with years of experience in the banking sector and after a successful career in one of the largest retail and commercial financial services providers. She has a passion for helping people with less financial confidence to get control of their money through budgeting, saving, and responsible credit practices.
Review & Fact Check: Baruch Mann (Silvermann)

Baruch Mann (Silvermann)

Financial Expert, The Smart Investor CEO

Experience

Baruch Mann (Silvermann) is a financial expert and founder of The Smart Investor. Above all, he is passionate about teaching people how to manage their money and helping millions on their journey to a better financial future.
Author: Lorraine Smithills
Lorraine Smithills

Writer, Contributor

Experience

Lorraine is a freelance finance writer with years of experience in the banking sector and after a successful career in one of the largest retail and commercial financial services providers. She has a passion for helping people with less financial confidence to get control of their money through budgeting, saving, and responsible credit practices.
Review & Fact Check: Baruch Mann (Silvermann)

Baruch Mann (Silvermann)

Financial Expert, The Smart Investor CEO

Experience

Baruch Mann (Silvermann) is a financial expert and founder of The Smart Investor. Above all, he is passionate about teaching people how to manage their money and helping millions on their journey to a better financial future.

We earn a commission from our partner links on this page. It doesn't affect the integrity of our unbiased, independent editorial staff. Transparency is a core value for us, read our advertiser disclosure and how we make money.

Rewards credit cards are cards that actually pay you a predetermined percentage of the amount of every transaction you have. These cards come in two main options, either cash back or travel cards.

Trave cards give you points, or miles, for every dollar you spend. These rewards can be used to pay for flights, hotel stays, car rentals, and other travel related purchases.

Cash back cards give you a percentage of every purchase in the form of cash, hence the name cash back credit card.

These types of credit cards make up over 60 percent of all the credit card offers on the market. The cashback cards make up over 30 percent of offers and 63 percent are points or miles cards.

When you go looking for the best rewards card, you will soon find that there are a lot of options out there to choose from. This is why we have gathered together information for the best reward credit cards available.

Here are The Smart Investor Select’s picks for the top rewards credit cards:

Card
Rewards
Bonus
Annual Fee
Best For

AMEX Blue Cash Preferred Card review

1-6% 6% cash back at U.S. supermarkets (up to $6,000 per year in purchases, then 1%) and selected U.S. streaming subscriptions, 3% cash back on transit and U.S. gas stations, 1% cash back on other purchases
$250 $250 statement credit after you spend $3,000 in purchases on your new Card within the first 6 months
$95 ($0 intro for the first year)
Everyday Spending

Bank of America® travel rewards

1.5X 1.5 points for every $1 you spend on all purchases everywhere, every time and no expiration on points
25,000 points 25,000 online bonus points after you make at least $1,000 in purchases in the first 90 days of account opening – which can be redeemed for a $250 statement credit toward travel purchases
$0
No Annual Fee

capital-one-venture

2X 2X miles per dollar on every purchase, plus 5X miles on hotels and rental cars booked through Capital One Travel
75,000 miles 75,000 miles once they spend $4,000 on purchases within 3 months from account opening
$95
Travel Experience

chase_sapphire_preffered

2X – 5X 5x total points on travel purchased through Chase Ultimate Rewards, 3x points on dining and online grocery purchases and 2x on other travel purchases. Plus, earn 1 point per dollar spent on all other purchases
60,000 points 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening
$95
Value for Money

Marriott Bonvoy Boundless Card review 2019

1x – 17X up to 17X total Bonvoy points per $1 spent at over 7,000 hotels participating in Marriott Bonvoy® with the Marriott Bonvoy Boundless® Card, 3X on the first $6,000 spent in combined purchases each year on grocery stores, gas stations, and dining and 2X Bonvoy points for every $1 spent on all other purchases
5 Free Nights 5 Free Nights (each night valued up to 50,000 points) after qualifying purchases
$95
Hotel Rewards

Sam's Club® Mastercard®

1-5% 5% cash back on gas anywhere Mastercard is accepted (on the first $6,000 per year, then 1% after), 3% cash back on Sam’s Club purchases for Plus members, 3% on dining and takeout and 1% on all other purchases
None
$0
Store

Wells Fargo active cash card

2% 2% cash rewards on purchases (unlimited)
$200 $200 cash rewards bonus when you spend $1,000 in purchases in the first 3 months
$0
Flat Rate Cashback

How to Maximize Your Points Rewards?

There are a couple of ways to maximize your rewards:

It's easy to be caught up in the frenzy of earning rewards left and right. But the more cards you use, the less likely you'll be able to build up points in any of them. Concentrate your spending on the card that gives you the best value in categories where you spend the most. This is better than farming out your purchases to several cards which prevents you from accumulating enough rewards on one card to make it worth your while.

You can find cards that give bonus miles when you spend a certain amount within the first few months of opening a new account. These bonuses are great when it comes to jump-starting your point rewards earning.

If it happened that your reward points have been scattered across several cards, consolidating them will be a wise choice. There are services to help you manage your points and rewards and they often offer a place for you to trade, transfer, and purchase points between your programs.

Maximizing your points rewards credit card and earning as many miles as possible means taking advantage of each bonus opportunity that comes your way. For some cards, that may mean keeping track of your spending and using your card for every purchase that can earn you a rewards bonus.

If your card gives you points, you should calculate the dollar value of each point so you can compute for the best possible return. The formula to follow is to divide the cash reward you are trading in by the number of points it takes to trade in for it.

Blue Cash Preferred® Card from American Express

AMEX Blue Cash Preferred Card review

Rates & Fees, Terms Apply

Blue Cash Preferred® Card from American Express

Reward details

1-6% 6% cash back at U.S. supermarkets (up to $6,000 per year in purchases, then 1%) and selected U.S. streaming subscriptions, 3% cash back on transit and U.S. gas stations, 1% cash back on other purchases

Current Offer

$250 $250 statement credit after you spend $3,000 in purchases on your new Card within the first 6 months

Credit Rating

Good – Excellent

Annual Fee

$95 ($0 intro for the first year)

0% Intro

12 months on purchases and balance transfers

APR

17.74%-28.74% Variable

Rates & Fees, Terms Apply

The Blue Cash Preferred® Card from American Express considered as one of the best rewards cards, offers an outstanding 6% cash back at U.S. supermarkets (up to $6,000 per year in purchases, then 1%) and selected U.S. streaming subscriptions, 3% cash back on transit and U.S. gas stations, 1% cash back on other purchases , making it a suitable choice for commuters and a 2.70% fee on foreign transactions. Terms Apply.

However, warehouse clubs and superstores are not included. The American Blue Cash Preferred Card charges an annual fee of $95 ($0 intro for the first year), but you can justify this if you reach the higher cashback threshold in U.S. supermarkets. This makes the card suitable for individuals that buy or purchase their groceries at traditional supermarkets. New cardmembers can earn up to $250 statement credit after you spend $3,000 in purchases on your new Card within the first 6 months.

  • Rewards Plan: 6% cash back at U.S. supermarkets (up to $6,000 per year in purchases, then 1%) and selected U.S. streaming subscriptions, 3% cash back on transit and U.S. gas stations, 1% cash back on other purchases
  • APR: 17.74%-28.74% Variable
  • Annual Fee: $95 ($0 intro for the first year)
  • Balance Transfer Fee: $5 or 3%, whichever is greater
  • Foreign Transaction Fee: 2.70%
  • Welcome Bonus: $250 statement credit after you spend $3,000 in purchases on your new Card within the first 6 months
  • 0% APR Introductory Rate: 12 months on purchases and balance transfers

* Terms Apply

  • Welcome Bonus
  • Cash Back Rewards
  • 0% APR Intro
  • Redeeming Options
  • Extended Warranty on Purchases*
  • $95 Annual Fee
  • Short Introductory Rates
  • Balance Transfer Fee
  • Foreign Transaction Fee
  • Minimum Redemption Amounts

  • Is there a limit to rewards/cash back? You can get the premium cashback rate on groceries until you have annual purchases in this area of $6,000. The rate then goes to 1%.
  • Can I get car rental insurance? how? Yes, you will get this insurance if you refuse the car rental company’s insurance coverage and you pay for the entire cost of the rental with this card.
  • Does it have a cash-back/point rewards limit? You can get the premium cashback rate on groceries until you have annual purchases in this area of $6,000. The rate then goes to 1%. Otherwise, there are no restrictions.
  • Do you need a proof of income?  No transparent income requirements or proof of income requests.
  • Does the rewards points expire? They do not expire once you keep your account open and meet a few basic conditions.
  • Can I get pre-approved?  Yes, you can get pre-approval.
  • What is the initial credit limit? It will be at least $1,000 and usually greater.
  • How do I redeem cash back? The rewards will be credited to you in the form of a statement credit.

Bank of America® Travel Rewards credit card

Bank of America® travel rewards

On Bank Of America Website, Terms Apply

Bank of America® Travel Rewards credit card

Reward details

1.5X 1.5 points for every $1 you spend on all purchases everywhere, every time and no expiration on points

Current Offer

25,000 points 25,000 online bonus points after you make at least $1,000 in purchases in the first 90 days of account opening – which can be redeemed for a $250 statement credit toward travel purchases

Credit Rating

Good – Excellent

Annual Fee

$0

0% Intro

15 billing cycles for purchases

APR

16.24% – 26.24% variable APR on purchases and balance transfers

On Bank Of America Website, Terms Apply

The Bank of America® Travel Rewards credit card is a good option for frequent travelers looking for travel rewards, especially if you're an existing customer of Bank of America. It offers a $0 annual fee while customers can use when they travel to earn points and gain rewards. To gain access to this card, you will need a solid credit score of between 680 to 850.

The Bank of America® Travel Rewards offers a agin up bonus of 25,000 online bonus points after you make at least $1,000 in purchases in the first 90 days of account opening – which can be redeemed for a $250 statement credit toward travel purchases, and you can use for purchases and other travel expenses. You're also not limited when you want to make travel arrangements as the card grants you flexibility. 

  • APR: 16.24% - 26.24% variable APR on purchases and balance transfers
  • Annual fee: $0
  • Balance Transfer Fee: 3% or $10 (the greater)
  • Foreign Transaction Fee: 0%
  • Rewards Plan: 1.5 points for every $1 you spend on all purchases everywhere, every time and no expiration on points
  • Sign Up bonus: 25,000 online bonus points after you make at least $1,000 in purchases in the first 90 days of account opening – which can be redeemed for a $250 statement credit toward travel purchases
  • 0% APR Introductory Rate period: 15 billing cycles for purchases
  • Point Sign-Up Bonus
  • Point Rewards
  • No Annual Fee
  • No Foreign Transaction Fee
  • Preferred Rewards, No Expiration
  • Minimum Redemption
  • There are Better Rewards Cards
  • Good - Excellent Credit Needed
  • Limited Travel Protections

  • Is there a limit to rewards/cash back on the Bank of America Travel Rewards Card? There is no cap.
  • Can I get car rental insurance with Bank of America Travel Rewards Card? how? 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 requirement and you do not always have to provide proof of income.
  • Does the card offer pre approval? Yes, pre-approval is an option
  • What is the initial credit limit ? The smallest credit limit for this card iwll usually be $500.
  • How do I redeem cash back ? You are able to redeem these points as statement credit to pay for the likes of travel and dining purchases or you can redeem as cash or in the form of gift cards.
  • Should You Move to Bank of America Travel Rewards CardIf you travel frequently and will use the rewards on travel-related purchases.
  • The bank denied my request, What's now?? 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? Redeem the points for travel-related or dining purchases, maximize the signup offer, and use in conjunction with another card.
  • When you shouldn't get the Bank of America Travel Rewards Card? If you do not travel a lot.

Capital One Venture Rewards Credit Card

capital-one-venture

On Capital One Website, Terms Apply

Capital One Venture Rewards Credit Card

Reward details

2X 2X miles per dollar on every purchase, plus 5X miles on hotels and rental cars booked through Capital One Travel

Current Offer

75,000 miles 75,000 miles once they spend $4,000 on purchases within 3 months from account opening

Credit Rating

Good – Excellent

Annual Fee

$95

0% Intro

N/A

APR

18.99% – 26.99% (Variable)

On Capital One Website, Terms Apply

The Capital One Venture Rewards is a low-cost travel card that worth’s its value. It allows you to earn rewards and bonus points while traveling for business, leisure, or pleasure. However, it requires holders to have a credit score of between 680 and 850.

The rewards plan includes 2X miles per dollar on every purchase, plus 5X miles on hotels and rental cars booked through Capital One Travel . The card attracts no annual fees, and you can get a sign up bonus of 75,000 miles once they spend $4,000 on purchases within 3 months from account opening.  

  • APR: 18.99% - 26.99% (Variable)
  • Annual fee: $95
  • Balance Transfer Fee: N/A
  • Foreign Transaction Fee: None
  • Rewards Plan: 2X miles per dollar on every purchase, plus 5X miles on hotels and rental cars booked through Capital One Travel
  • Sign Up bonus: 75,000 miles once they spend $4,000 on purchases within 3 months from account opening
  • 0% APR Introductory Rate period: N/A
  • Flexible Rewards Redemption
  • Great Sign-Up Bonus
  • No Blackout/Expiration Dates
  • No Accumulation Limit on Miles
  • High Variable APR
  • Airline Partners Limitations
  • $95 Annual Fee
  • Redeem Points for a Statement Credit

  • What are Capital One Venture card income requirements? Capital One often required monthly income to be at least $800. Sometimes, you will need to show some proof of income.
  • Does rewards points expire? They do not expire.
  •  Can I get pre-approved on card Capital One Venture CardYes, you can get pre-approval.
  •  What is the initial credit limit ? The minimum credit limit is set at $5,000.
  •  How do I redeem cash back? You can do so in a number of ways, such as spending your accumulated miles directly on travel purchases, or redeem as cash, using at participating retailers, and so on.
  •  What purchases don't earn cash back with the Capital One Venture Card? Every purchase earns cashback.
  •  Should You Move to Capital One Venture CardIf you spent a decent amount of time and money on travel expenses.
  •  Why did Capital One Venture Card deny me? What to Do Next? 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.

Chase Sapphire Preferred® Card

chase_sapphire_preffered

On Chase Website, Terms Apply

Chase Sapphire Preferred® Card

Reward details

2X – 5X 5x total points on travel purchased through Chase Ultimate Rewards, 3x points on dining and online grocery purchases and 2x on other travel purchases. Plus, earn 1 point per dollar spent on all other purchases

Current Offer

60,000 points 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening

Credit Rating

Good – Excellent

Annual Fee

$95

0% Intro

N/A

APR

18.24% – 25.24% Variable

On Chase Website, Terms Apply

The Chase Sapphire Preferred® Card is a travel rewards card issued by Chase Bank. This is a very popular travel rewards card because it offers a large sign-up bonus and the card is built around traveling. Many travel rewards cards have higher annual fees for the same kind of rewards. The card offers a sign-up bonus of 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening.

This card is on our top spot in regards to the best traveling and dining cards as they offer you more points compared to other cards - 5x total points on travel purchased through Chase Ultimate Rewards, 3x points on dining and online grocery purchases and 2x on other travel purchases. Plus, earn 1 point per dollar spent on all other purchases .

  • Rewards Plan: 5x total points on travel purchased through Chase Ultimate Rewards, 3x points on dining and online grocery purchases and 2x on other travel purchases. Plus, earn 1 point per dollar spent on all other purchases
  • APR: 18.24% – 25.24% Variable
  • Annual fee: $95
  • Balance Transfer Fee: 5% or $5, whichever is greater
  • Foreign Transaction Fee: 0%
  • Sign Up bonus: 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening
  • 0% APR Introductory Rate: N/A
  • Point Sign-Up Bonus
  • Bonus Points
  • No Blackout Dates
  • 25% More through Ultimate Chase Rewards
  • No Foreign Transaction Fee
  • $95 Annual Fee
  • Low Merchandise Rewards
  • No Introductory 0% 
  • Balance Transfer Fee - 5% or $5, whichever is greater

  • Does the travel rewards points expire? Your points won’t expire once you keep the credit card account open.
  • Does card Chase Sapphire Preferred offer pre-approval? Yes, you are able to pre-qualify for this card.
  • What is the initial credit limit? The minimum credit limit that you can get with this card type is usually $5,000.
  • How do I redeem cash back? You can redeem your points in a variety of ways through the Chase credit card reward portal. Some of the perks you can get include cash, travel credit, statement credit, and gift cards.
  • What purchases don't earn cash back? All purchases will earn cashback through this card.
  • Should You Move to Chase Sapphire Preferred card?  If you travel frequently and do not want to pay a large annual fee.
  • Why did the Chase deny me? You might not have met one of its requirements. You will usually find out where you fell short. You might be able to rectify the issue or you might have to look elsewhere.
  •  How hard is it to get a Chase Sapphire Preferred card? If you meet all of the requirements, then it is relatively straightforward to get a Chase Sapphire Preferred card. The requirements are easier compared to Chase Sapphire Reserve card.
  • Is there a limit to rewards/cash back on the Chase Sapphire Preferred card? No limit
  • Can I get car rental insurance with a Chase Sapphire Preferred card? how? Yes, you can get car rental insurance with this card if you decline the collision cover of the rental company and pay for the entire cost of the rental car with this card.

Marriott Bonvoy Boundless® Credit Card

Marriott Bonvoy Boundless Card review 2019

On Chase Website, Terms Apply

Marriott Bonvoy Boundless® Credit Card

Reward details

1x – 17X up to 17X total Bonvoy points per $1 spent at over 7,000 hotels participating in Marriott Bonvoy® with the Marriott Bonvoy Boundless® Card, 3X on the first $6,000 spent in combined purchases each year on grocery stores, gas stations, and dining and 2X Bonvoy points for every $1 spent on all other purchases

Current Offer

5 Free Nights 5 Free Nights (each night valued up to 50,000 points) after qualifying purchases

Credit Rating

Good – Excellent

Annual Fee

$95

0% Intro

None

APR

17.99%-26.99% Variable

On Chase Website, Terms Apply

If you're using Marriot frequently or looking for a decent hotel rewards card, the Marriott Bonvoy Boundless® Credit Card may be a perfect match for your needs. 

It offers up to 17X total Bonvoy points per $1 spent at over 7,000 hotels participating in Marriott Bonvoy® with the Marriott Bonvoy Boundless® Card, 3X on the first $6,000 spent in combined purchases each year on grocery stores, gas stations, and dining and 2X Bonvoy points for every $1 spent on all other purchases and a very attractive sign up bonus of 5 Free Nights (each night valued up to 50,000 points) after qualifying purchases. 

However, the card charges $95 annual fee and doesn't offer 0% intro.

  • Rewards Plan: up to 17X total Bonvoy points per $1 spent at over 7,000 hotels participating in Marriott Bonvoy® with the Marriott Bonvoy Boundless® Card, 3X on the first $6,000 spent in combined purchases each year on grocery stores, gas stations, and dining and 2X Bonvoy points for every $1 spent on all other purchases
  • APR: 17.99%-26.99% Variable
  • Annual fee: $95
  • Balance Transfer Fee: $5 or 5%
  • Foreign Transaction Fee: 0%
  • Sign Up bonus: 5 Free Nights (each night valued up to 50,000 points) after qualifying purchases
  • 0% APR Introductory Rate period: None
  • Sign-up bonus of points:
  • Sign-Up Bonus
  • Annual Reward
  • Ongoing Points Rewards
  • Transfer to Airline Points
  • Automatic Silver Status
  • Chase Restrictions
  • Confusing Rewards
  • Annual Fee
  • No 0% Intro

Sam's Club Mastercard

Sam's Club® Mastercard®

On Sam's Website, Terms Apply

Sam's Club Mastercard

Reward details

1-5% 5% cash back on gas anywhere Mastercard is accepted (on the first $6,000 per year, then 1% after), 3% cash back on Sam’s Club purchases for Plus members, 3% on dining and takeout and 1% on all other purchases

Current Offer

None

Credit Rating

Good – Excellent

Annual Fee

$0

0% Intro

None

APR

15.65% or 23.65% Variable

On Sam's Website, Terms Apply

The Sam’s Club Mastercard is a great card for Sam’s Club shoppers. It has very competitive cashback rewards and benefits in some spending categories.

Sam’s Club Mastercard offers 5% cash back on gas anywhere Mastercard is accepted (on the first $6,000 per year, then 1% after), 3% cash back on Sam’s Club purchases for Plus members, 3% on dining and takeout and 1% on all other purchases.  The rewards categories do not change and are great for those who spend a lot on gas and traveling and who are Sam’s Club members.

The card does not have a foreign transaction fee or annual fee as long as you are a Sam’s Club member (Membership starts at $45 a year). This card can be used anywhere Mastercard is accepted, not just at Sam’s Club.

  • APR: 15.65% or 23.65% Variable
  • Annual fee: $0
  • Balance Transfer Fee: N/A
  • Foreign Transaction Fee: N/A
  • Rewards Plan: 5% cash back on gas anywhere Mastercard is accepted (on the first $6,000 per year, then 1% after), 3% cash back on Sam’s Club purchases for Plus members, 3% on dining and takeout and 1% on all other purchases
  • Sign Up bonus: None
  • 0% APR Introductory Rate period: None
  • Cash Back on Gas, Restaurants and Travel & Other Spending
  • No Annual Fee
  • Higher cashback on Sam's Club purchases
  • Redemption Restrictions
  • No Sign-Up Bonus or 0% APR Introductory Rate
  • Rewards Cap

The Wells Fargo Active Cash℠ Card

Wells Fargo active cash card

On Wells Fargo Website, Terms Apply

The Wells Fargo Active Cash℠ Card

Reward details

2% 2% cash rewards on purchases (unlimited)

Current Offer

$200 $200 cash rewards bonus when you spend $1,000 in purchases in the first 3 months

Credit Rating

Good – Excellent

Annual Fee

$0

0% Intro

15 months on purchases and qualifying balance transfers

APR

17.99% – 27.99% variable

On Wells Fargo Website, Terms Apply

The Wells Fargo Active Cash Card does not charge any annual fee and stands out by it offers. You can earn 2% cash rewards on purchases (unlimited) on every purchase you make with this card, as well as a decent bonus for a card with no annual fee and an introductory 0% APR with a cash bonus.

Wells Fargo also offers built in protections against unauthorized transactions with additional security features such as Voice verification.

  • Rewards Plan: 2% cash rewards on purchases (unlimited)
  • APR: 17.99% - 27.99% variable
  • Annual fee: $0
  • Balance Transfer Fee: $5 or 5% (the greater)
  • Foreign Transaction Fee: 3%
  • Sign Up bonus: $200 cash rewards bonus when you spend $1,000 in purchases in the first 3 months
  • 0% APR Introductory Rate period: 15 months on purchases and qualifying balance transfers
  • Sign-Up Bonus
  • No Foreign Transaction Fee
  • Cashback on All Other Categories
  • No Annual Fee
  • 0% APR on Balance Transfers and Purchases
  • Minimum Redemption Amounts
  • Balance Transfer Fee
  • Lower Cashback Rate

  • Can I get car rental insurance? 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? No cap
  • Does Wells Fargo Active Cash Card 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 on card Wells Fargo Active Cash CardYes, pre-approval is a possibility.
  • What is the initial credit limit ? It will usually be at least $500.
  • How do I redeem cash back? You are able to redeem the rewards in numerous ways. This includes as statement credit, as cash, withdrawn at an ATM, or redeemed as a gift card. You can also use the rewards when paying through PayPal at an online checkout.
  • What purchases don't earn cash back? All purchases will earn you cashback
  • Why did Wells Fargo Active Cash Card deny me? What to Do Next? 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 Use Wells Fargo Active Cash Card Benefits? Use in conjunction with other cards and make the most of the signup offer.
  • Top reasons NOT to get the Wells Fargo Active Cash Card? If you want bigger cashback rates or don’t want to pay any foreign transaction charges.

Best Rewards Cards - What You Should Know?

What are Points Rewards Credit Cards?

Credit card rewards take the shape of many forms but they have one purpose: to give incentives to cardholders to push them to use the card more. Rewards would often fall into one of three categories: cash, points, or miles.

With a points rewards card, you get a certain number of points for every purchase that you make, such as 2X points per dollar amount. Now, depending on which card you are using, you can redeem the points for merchandise in the reward program’s online shopping mall. You may also choose to exchange your points for gift cards, cash, or even travel. Sometimes, you can transfer them to a partner airline or hotel loyalty program.

Which Type of Customer is the Best Fit For?

A rewards credit card is beneficial for anyone who normally charges most of their expenses through their credit card. They are the ones who can take advantage of it and accumulate points to redeem for their choice of rewards whether they be flights, cashback, items, or gift cards.

Points rewards work better for people who have more credit card experience and who are willing to exert more effort to get a good value for their points.

How to Choose a Points Rewards Card?

There are some factors you should consider when thinking about points rewards card:

Rewards & Earn Rate

A nice points rewards credit card should give out bonuses. If you use it correctly, your rewards card can help you earn money. But it depends on the card that you will get. You should apply for one that best fits your spending habits. Earn rate means the number of points you will get for every $1 that you charge to your card. The rule of thumb is the higher points per dollar, the better. However, if you get a card that gives 1 point for every dollar, that’s more than acceptable.

Your first consideration should be a points rewards card that will give you something that would make sense for you. For example, if you travel a lot, a travel rewards card may be the right thing. It can offer you bonus points for airfare purchases and hotel bookings so you can get more points for your usual purchases.

What's Your Card Goal?

But before you apply for a credit card, decide what you want to accomplish by having a card. Is it to earn free stuff or to pay for an existing card debt thru a balance transfer facility? Consider your lifestyle – then pick a card that would complement your priorities and interests.

If you want a variety of rewards, you will find that there are a lot of good cash-back credit cards that can help you meet your goals. If you’re after consistency in your rewards for your usual purchases and only look after one card, you can’t go wrong with a cashback credit card.

Fees

If you plan to settle your card bill in full every month, you need not worry about the interest rate so, it’s almost immaterial. If you can continue doing this, you can improve your credit and perhaps later ask your issuer to bring your interest rate down.

Not all cards charge the same set of fees. When you see the fine prints of the Terms and Conditions of the card, don’t be intimidated – you can find the list of main fees printed prominently in their marketing materials. Some of the fees you should look out for are:

  • Annual fee – This is the fee that you pay for the convenience of having a credit card at your disposal. You’ll find that not all points rewards credit cards charge an annual fee.

  • Balance transfer fee – This is the fee that you pay if you avail of a balance transfer facility. This is a transaction that lets you transfer your outstanding balance from one card to the new card.

Issuers charge a percentage of the balance transfer. It’s commonly placed at 3% of the transaction amount or $5, whichever is higher. So, the higher the balance you want to transfer, the higher your fee would be.

  • Cash advance fee – The issuer will collect a cash advance fee when you avail of a cash advance or a similar transaction. Take note that overdraft protection and credit card convenience checks will also qualify as a cash advance transaction.

  • Foreign transaction fee – When you use your card to make a purchase in any foreign currency, your issuer might charge you a foreign transaction fee. Your issuer might compel you to pay this fee regardless of your physical location when you made the transaction as long as the currency is other than U.S. dollars.

When choosing a credit card, one of the things you need to consider is the free structure. In this chart compiled with creditcards.com data, we can see that late payment fees are the most common type of fee. This is followed by cash advance fees. At the other end of the scale, we can now see that over limit fees and annual fees are far less common. This highlights the importance of making payments on time, which can not only save on fees but help you to establish a solid credit history.

 

APR

APR stands for the annual percentage rate of the interest rate that you’ll pay every year as represented by the formula monthly rate X 12. But there’s more to it than meets the eye.

You’ll encounter things like introductory rates, variable rates that change depending on the balance that you retain on your card, and layers of rates that apply in different ways as you use your card. A good rule to follow when shopping for a credit card is to find one with the lowest APR because it could give you the lowest interest to pay.

But remember that comparing interest rates isn’t a simple matter. Many issuers offer different rates based on your credit score. So, unless you have stellar credit, it would be better to go for a card that offers a single, fixed rate.

Credit Limit

An ideal card should provide you with an adequate credit limit to purchase your normal requirements with convenience but not so much credit that you might bury yourself in debt. If you're a college student who is just learning to use a credit card, a low-limit card is a safe option for you.

But once you graduate, you may need to ask for a higher credit limit to keep up with your rising monthly expenses. And having a higher limit might be helpful to your credit over time as long as you don't max out your card. It will work well for your credit score if you have a higher limit but spend way below your total limit.

You're the best person who can judge yourself. If you know that you have not been very responsible in the use of your credit in the past, it's better not to take on more credit because it may just lead you to debt problems.

This chart created with Experian data, highlights the significant increase in the average credit card limits in the last decade. Credit card limits have consistently increased with an overall increase in the recent 10 years.

 

Special Perks

In addition to point rewards, many credit cards offer additional benefits that can be useful if you want to get a rental car insurance, pay off debt, get tickets to concerts, or get extra protection. Many credit cards also provide the following additional benefits:

  • 0% intro APR
  • Premium seats in flights
  • Extended Warranty
  • Travel accident insurance
  • Baggage insurance
  • Welcome bonus
  • Rental car insurance
  • Dining credit
  • Concierge service
  • Exclusive access to ticket presales
  • Liability & fraud protection
  • Vouchers for sport & culture events
  • $0 food delivery fee
  • Travel assistance services
  • Shopping portals

Benefits

Point rewards card provide a couple of great benefits for cardholders:

Perhaps this is the most noteworthy benefit of points rewards cards. It gives you the flexibility to use your rewards for a number of things. For example, you can use the cash rewards to bring down your outstanding balance.

Or get travel rewards to treat your family to a free vacation. You can use your points to buy gifts for your loved ones for their birthdays or during holidays. If you want, you can invest the rewards that you accumulate.

Most rewards credit cards offer sign-up bonuses, which provide you with additional benefits when you first apply for the card.

However, they frequently require that you spend a certain amount of money within a certain time frame in order to receive the bonus points. However, it's a simple way to get a head start on your point balance. Just make sure the spending requirement does not interfere with your budget.

Points rewards cards sometimes attract new cardholders by offering sign-up deals that give thousands of bonus points. Although the catch is for you to spend a set amount within a defined period, it's a good way to build a cluster of points to start your rewards journey. 

But be mindful of your spending so that you don't go over your budget just to get the bonus points.

Point rewards credit cards often give you additional benefits that add value to the account. You can choo Not all rewards credit cards are the same. It's not a matter of looking for the right card for you but rather, looking for the best card for your situation. It should be one that would give you the highest reward value compared to other options.

Once you have all this information on hand, you can make an intelligent decision on which point rewards credit card to get.se from features like Price match guarantees, Purchase protection insurance, Complimentary travel insurance, or free access to airport lounges.

Drawbacks

On the other hand, there are no free meals. While there are a lot of perks, cardholders should take into account the drawbacks of rewards cards:

Moast of the points rewards cards charge an annual fee. This doesn't really matter if you spend so much on the card each year that you can offset the fee.

When evaluating the annual fee, take into consideration any benefit that translates into a dollar value that can pay for the annual fee such as an annual credit or a higher points rewards conversion.

Reward cards usually have higher interest rates than other credit cards. This means that it's best that you don't carry a balance on the card to avoid interest charges.

Points rewards programs are often a little complicated. For example, at first glance, a card may offer to reward you 7%. But there might be a small print that tells you to first spend $5,000 on your card for the year in order to qualify.

You can also find there are restriction caps or minimum redemption amounts that make it difficult to redeem rewards. Issuers sometimes change their reward program terms without warning so make sure that you read every marketing material that comes with your monthly billing statement.

Take note that you might lose your points by expiration if you don't use them within a certain amount of time. The best reward programs keep your points always fresh but most cards will forfeit your points if you fall behind on your credit card payments.

Does The Annual Fee Worth it?

Well, it depends. In case your card charges an annual fee, you should make sure your spending habits aligned with the rewards the card offers, and that you can cover the annual fee with the rewards you get.

For many consumers, a lack of an annual fee is an attractive feature of any credit card. Lenders have recognized this trend, and today, most cards do not have an annual fee. However, savvy consumers want more from their credit cards. In this chart created with US news data, you can see the percentage of no-annual fee cards by card type.

 

How Do You Redeem Your Points?

If you are thinking of how you can get a discount on your next purchase or how to save some money during the holidays, the solution may be in your rewards card. Some credit cards add a perk for their cardholders allowing them to shop online at select retailers and use their points to pay for their purchases in full or in part. Or, you can go by way of Gift Cards.

It is a popular way to redeem your credit card rewards because they are convenient and it's easy to determine the point-to-dollar value. Another popular use is to use your points to redeem airline tickets. And whether your points are about to expire or you're switching credit cards, think about donating your points to a charitable cause rather than spending them on things you don't need.

Points Rewards Card Requirements

The bad news is, most point rewards credit cards require applicants to have good or excellent credit. And the best reward credit card programs are often exclusive to consumers with the best credit scores.

If you don't fall into these categories, you may not qualify for any reward credit cards. Some issuers reserve their best point rewards credit cards to those with “prime” credit score of at least 630 points. And of course, you shouldn't apply for any credit card if your credit score is very bad and you won't be able to pay your bills on time.

Mistakes To Avoid When Choosing a Points Rewards Card

Here are some of the main mistakes you should be aware of, especially if you want to avoid to spend more than you planned:

Card companies are experts when it comes to selling their points program and making you spend more using your card to get more points. And they put expiry dates on your points to move you into trying to build up more points by spending more.

Card issuers partner with retailers and other businesses to provide wider choices for your rewards. You can also earn bonus points when you buy from partner stores.

Most rewards cards will let you redeem your reward points in exchange for merchandise. You can get housewares or home electronic appliances for your points. However, when you make some computations, you'll be able to see that the redemption values for these types of rewards purchases are disproportionate. In fact, they often pale when you compare them with travel rewards which have a higher value option.

A credit card debt is probably the most common debt that the average person has. And this is on top of other debts that he might have. Point rewards can push you to spend more, and this is exactly what card companies want. They will make a lot of money off the interest that you will pay when you accumulate card debt. 

But take note that points rewards credit cards have higher interest rates compared to your average card. The longer time it takes you to pay off your card debt, the more interest you will build up offer time.

What's The Average Credit Card Debt By Age?

In this chart using data from Urban Institute, you can see that the age group 43 to 47 carries the highest average credit card debt. This age group has almost double the credit card debt of their under 32 year old counterparts or seniors aged 68+.

 

If you max out your credit card limit, you're exposing yourself to many financial risks. The more you charge, the more it becomes difficult to pay off the entire balance. If you exhaust your card limit, you won't have enough stand-by means in case you have an emergency.

Another thing is, maxing out your card increases your credit utilization ratio. Your credit utilization ratio shows the speed by which you amass credit card debt. A high ratio is detrimental to your credit score. Lenders do not like a borrower's ratio to be above 30%. So, if you max out your card, chances are, you will go over the 30% threshold.

Bottom Line

Not all rewards credit cards are the same. It's not a matter of looking for the right card for you but rather, looking for the best card for your situation. It should be one that would give you the highest reward value compared to other options. Once you have all this information on hand, you can make an intelligent decision on which point rewards credit card to get.

* Eligibility and Benefit level varies by Card. Terms, Conditions, and Limitations Apply. Please visit americanexpress.com/benefitsguide for more details. Underwritten by Amex Assurance Company. 

Lorraine Smithills

Lorraine Smithills

Lorraine is a freelance finance writer with years of experience in the banking sector and after a successful career in one of the largest retail and commercial financial services providers. She has a passion for helping people with less financial confidence to get control of their money through budgeting, saving, and responsible credit practices.