How many credit cards do you have in your wallet right now? Are you thinking of getting a new one?
According to the Federal Reserve Bank of Boston, 2 out of 3 Americans have at least one credit card.
Credit cards are one of the most usual ways of building credit and financing large expenditures.
Furthermore, many come with additional benefits, such as the ability to earn cash back or rewards.
If you currently hold a credit card, you are probably aware of the pros and cons of having one. But if you are yet to be part of the credit card-holding population, you may be wondering what things to consider before getting your own.
Consider Your “Why”
Whether you are a beginner wanting to get your first credit card, or a current cardholder looking to add a new card to your wallet, you should take a minute to consider your “why.”
Getting a credit card is a huge decision and knowing the reason why you are getting it is crucial, as this will serve as a basis on what type of credit card you should get. You should also consider your current ability to repay charges as this will affect your score and finances一instead of building your credit, you may end up damaging it and more debts.
One of the things that you are probably excited about getting a card is the opportunity to earn rewards. Imagine being rewarded for spending. It is incredible!
The Best Rewards Credit Cards For Different Needs
There are two types of reward credit cards: with cash back credit card (the issuer pays you back a certain percentage each purchase) and with points/miles credit card (issuer gives you a certain number of points/miles per dollar spent).
If you are currently looking for credit cards with the best rewards, we have listed five below:
Ideal for: Frequenttravelers
Rewards: Cardholders can earn 5x points on travel purchased through Chase Ultimate Rewards®, 3x points on dining including eligible delivery services, 3x points on online grocery purchases (excluding Target, Walmart, and wholesale clubs), 3x points on select streaming services, 2x points on all other travel purchase, and 1x point on other eligible purchases.
Bonus offer: 60,000 bonus points after you spend $4,000 on purchases in the first three months from account opening; 10% anniversary points bonus
Other benefits: Cardholders are covered with the built-in benefits, including:
1:1 point transfer to airline and hotel travel partners
Trip cancellation/Interruption Insurance
Baggage delay insurance
Trip delay reimbursem*nt
Auto rental damage waiver
Shopping protection and extended warranty protection
No foreign transaction fees
Annual Fee: $95
Annual Percentage Rate: 15.99%-22.99% Variable
Credit Score: Good/Excellent
Why this card: This card is a dream for frequent travelers and diners, offering a rare combination of high rewards rates and redemption flexibility – all for a fair annual fee.
Blue Cash Preferred® Card from American Express
Ideal for: Families (groceries, gas, commuting, and streaming)
Rewards: Cardholders can earn 6% cash back on purchases at U.S. supermarkets, up to $ 6,000 per year, and on select U.S. streaming subscriptions, 3% cash back on transit including taxis, rideshare, parking, tolls, trains, buses, and more, and on gas at U.S. gas stations, and 1% cash back on other purchases
Bonus offer: 20% cash back on Amazon.com purchases within the first six months of account opening, up to $200 back, earn $150 back after you spend $ 3,000 within the first six months of account opening
Other benefits:
Car rental loss and damage insurance
Cash back every time an Additional Card Member makes an eligible purchase
Return Protection
Annual Fee: 0% for the first year, then $95
Annual Percentage Rate: 0% intro APR on purchases for 12 months, then 13.99%-23.99% Variable
Credit Score: Good/Excellent
Why this card: This card offers higher rewards rates for the most common purchases–groceries, gas, and commuting.
Blue Cash Everyday® Card from American Express
Ideal for: Families (groceries and gas)
Rewards: Cardholders can earn 3% cash back on purchases at U.S. supermarkets, up to $ 6,000 per year, then 1%, 2% cash back at U.S. gas stations and select U.S. department stores, and 1% cash back on other purchases
Bonus offer: 20% cash back on Amazon.com purchases within the first six months of card membership, up to $150 back, earn $100 back after you spend $ 2,000 within the first six months of account opening
Other benefits:
Car rental loss and damage insurance
Cash back every time an Additional Card Member makes an eligible purchase
Return Protection
Annual Fee: No annual fee
Annual Percentage Rate: 0% intro APR on purchases for 15 months, then 13.99%-23.99% Variable
Credit Score: Good/Excellent
Why this card: This card offers fair rewards rates for groceries and gas purchases for a zero annual fee.
Discover it® Secured Credit Card
Ideal for: Consumers trying to build credit
Rewards: Cardholders can earn 2% at gas stations and restaurants on up to $1,000 in combined purchases each quarter and 1% on all other purchases.
Bonus offer: None
Other benefits:
Refundable deposit
Free FICO® Credit Score on monthly statements
Unlimited cash back match at the end of the first year
Annual Fee: No annual fee
Annual Percentage Rate: 22.99% standard variable for purchases, 10.99% Intro balance transfer APR for six months from date of first transfer, 24.99% Variable for cash advances
Credit Score: Poor
Why this card: For a zero annual fee, cardholders can benefit from the unlimited cash back match at the end of the first year and the free FICO® Credit Score
Delta SkyMiles® Gold American Express Card
Ideal for: Airline Credit Card
Rewards: Cardholders can earn 2X miles on dining at restaurants (including takeout and delivery), on groceries at U.S. supermarkets, on purchases made directly with Delta, and 1X miles on other purchases
Bonus offer: 70,000 bonus miles after you spend $2,000 in purchases within the first three months. Offer ends 11/10/2021. $100 Delta Flight Credit after you spend $10,000 in purchases in a year.
Other benefits:
First checked bag free on Delta flights
$100 Delta Flight Credit after Cash back every time an Additional Card Member makes an eligible purchase
Return Protection
No foreign transaction fees
20% back on in-flight purchases
Car rental loss and damage insurance
Purchase protection and extended warranty coverage
Annual Fee: 0$ for the first year, then $99
Annual Percentage Rate: 15.74% to 24.74% variable APR on purchases.
Credit Score: Good/Excellent
Why this card: For a fair annual fee, cardholders can earn miles on normal purchases.
Although this is not a comprehensive list of all rewards credit cards with low annual fees, these are our favorites and among the best on the market.
Choosing the best credit card is essential, but don’t stop there. Once you get your card, use it correctly. If you are trying to establish your credit, pay your bills in full every month and don’t max out your available credit (experts suggest using no more than 30% of your limit).
Pick one of these cards and maximize its benefitsーuse your card for everyday transactions and pay your charges in full each month.
Whether you are looking to build credit or earn rewards, the credit card you pick should help you reach your financial goals in the most cost-effective and efficient way possible, and it should be tailored to your specific needs.
