What is the Best Rewards Credit Card?

Rewards Credit Cards

Americans spend over $1 trillion a year on rewards credit cards. Which is insane, considering it’s a form of debt that carries hefty interest rates. In this article, we’ll compare the most popular rewards credit cards on the market to help you find one that suits your needs and interests best.

What is a Rewards Credit Card?

A rewards credit card is different from a standard credit card in that the balance on the card accrues points for purchasing goods or services. A typical rewards card will have two elements to it: cash back, or percentage of what is being purchased, and additional cards which can be used for specific merchants. The Diner’s Club was the first rewards system ever created, so this type of card has been around since 1950 – before most people had charge cards.

Different Types of Rewards Credit Cards

There are three broad categories of rewards credit cards: cash, travel, and other. The first category refers to just what you do – spend money on that card for rewards. This type of card is the simplest to understand. All that matters is that each dollar charged on it yields some reward – typically points or miles which you can use for spending. The other types require more research before choosing between them because their rewards come in different forms or arrangements. Most reward providers offer better rates for spending specific types of items so this is something worth considering before signing up for a specific credit card.

Why Do People Use Cards That Offer Rewards?

Rewards cards are more than just tools for spending. People use rewards cards to make sure they can afford to live according to their desired lifestyle. They provide essential convenience, in addition to the opportunity for financial rewards in return for everyday purchases.

Best Cash Reward Cards

There are some times when credit card rewards can actually outweigh the fundamental cost of carrying a balance. This is often the case with cash back cards where any spending on these cards will yield you cash back in return. But beware, not all people will earn the same during their card’s promotions. During recent promotions, I’ve seen that some people could earn more than five dollars for every single dollar spent on the card while others could only get one or two dollars for every dollar spent on their card. With this in mind, it’s important to do your research on what types of rewards are offered before making a decision.

Wells Fargo Active Cash Card

The Wells Fargo Cash Card is a cashback rewards credit card that offers 2% cash back on purchases. It also provides a great 0% interest rate, which makes it one of the most attractive options on the market today. This card is the perfect solution for someone who wants to maximize their cash back rewards, but doesn’t necessarily want to go with a premium credit

Capital One SavorOne Cash Rewards Credit Card

The SavorOne card has one of the best rewards programs on the market. There is no annual fee and every purchase earns you 1% cash back on every dollar spent with this card. If you are a big spender, you can also earn 20,000 bonus points after spending $500 within your first three months of opening your account.

American Express Gold Card

The American Express Gold Card is the top-rated rewards credit card. It offers a range of benefits that can help maximize savings and rewards. These include: no annual fee, no foreign transaction fees, points can be cashed in for a statement credit, and a purchase return protection program.

 

Best Airline Reward Cards

If you are looking for an airline reward card, consider not necessarily getting one issued by the airline. Instead, see what banks offer the best cards. For instance, Citibank has a nice option that is quite competitive with Chase or American Airlines where regular points will be converted into miles on most airlines.

Best Points Reward Cards

Currently, the Chase Sapphire Preferred offers 50,000 points when booking your trip. Additionally, points are worth 1 cent each, which means that it could be worth up to $500 in airfare or one night at the Grand Canyon Grand Hotel.

The Benefits of a Rewards Card

A rewards credit card is a type of offer that gives a cash back or a free flight for every dollar spent. Rewards cards have an ultimate goal of bringing the customer back to use their card more. The benefits can include something as simple as a 2% interest rate (much lower than most credit cards), or something much more enticing like airline miles or cash back. Money expert Clark Howard does not recommend big-name cards like the Chase Sapphire ” because, among other things, they also make it easy to manufacture spending” Some rewards cards even give you points for making purchases with it. You can be rewarded for your spending habits by any store you choose with the card, which is an added bonus. For example, if it happens to be Starbucks, then you will earn points every time you purchase coffee beans.

Annual Fees on the Best Credit Cards

Whether you like cash back, credit miles, or other rewards, some credit cards charge some high annual fees for their benefits. These high fee cards might be right for some people; others more money-conscious will likely avoid them. If you’re considering paying membership fees for your credit card, compare the perks to other cards before you decide. If there really are benefits attached to the card, you might find the higher fee worth paying for.

Also, you should read our No Annual Fees Credit Cards article.

 

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