What are the best rewards credit cards? And how are they selected?
The best rewards credit card right now is probably the Capital One® Venture® Card
. It offers a massive 50,000-mile initial bonus, worth $500 in travel, for spending $3,000 within three months of account opening. It gives you the equivalent of 2% cash back on all purchases, when you redeem your miles for travel. And that’s the best part: You can use Venture miles to pay for any travel-related purchase made with your card, from airfare and hotel reservations to taxi rides.
But you have to understand that the best credit cards for rewards are not one-size-fits-all. A lot depends on your credit standing and spending habits. Not everyone travels enough for Venture to be worthwhile or has the good or excellent credit needed to qualify. With that in mind, WalletHub’s editors regularly compare 1,000+ offers to identify the market’s best rewards credit cards for different types of users. These cards are picked because they provide the most overall value (rewards minus fees) in the most popular usage categories.
WalletHub’s editors regularly compare 1,000+ offers to identify the market’s best rewards credit cards. These cards are picked because they provide the most overall value (rewards minus fees) in the most popular usage categories. We estimate value by calculating how much the average person
would get from each card over the first two years of use. We consider two years to level the playing field. For example, some cards offer a big initial bonus but little ongoing value, while others have an annual fee that’s waived for the first year.
This approach led us from 1,000+ offers to the eight best credit cards for rewards right now.
Here are 2018’s best rewards credit cards
The best credit card rewards come in all shapes and sizes. The offers on this page are the best overall. But you can find more great options by checking out WalletHub’s picks for the best cash back credit cards
and the best travel rewards cards
. And if you’re mainly in the market for a hefty initial rewards bonus, make sure to review our up-to-date list of the best credit card deals
What is the connection between credit standing and rewards credit cards?
Whether your credit is excellent, bad or somewhere in between, you may be able to find a rewards credit card that will approve you. But the better your credit standing is, the more options you’ll have and the more attractive their terms will be. For example, the market’s best overall rewards cards are generally available only to people with good or excellent credit.
On the flip side, the lower your credit score is, the more important low fees will become relative to rewards. You’ll be unlikely to get approved for a high spending limit, after all, making it difficult to earn enough rewards to offset any annual fee your card may charge. And rewards cards for people with fair or bad credit do tend to charge annual fees. As a result, if you don’t yet have good credit, your top priority should be finding a no annual fee credit card
that will approve you, rather than worrying about rewards.
If you don’t know where your credit currently stands, you can find out by checking your latest credit score for free on WalletHub
How do I know what kind of rewards to get?
Rewards credit cards come in all shapes and sizes. They offer different rewards currencies (i.e. points, miles or cash back) at different earning rates. And those rates often vary based on what you buy and how much you spend.
Plus, even the best credit card rewards won’t do you much good if they’re difficult to earn and redeem. For example, a particular airline credit card might offer great rewards, but if you never leave town or don’t always fly with that airline, you will neither earn very much nor be able to redeem often enough to actually enjoy any perks that you do receive. So you’ll need to consider how well each offer complements your lifestyle and personal-finance preferences.
More specifically, here’s how to proceed if you want to find the best rewards card for your needs:
- Check your latest credit score. You don’t want to waste time comparing cards you can’t get. And credit scores can change by up to 100 points over the course of just a month.
- Pinpoint your biggest monthly spending expenses (e.g. travel, gas and groceries).
- Decide whether you’re going to use the card for everyday shopping or just for earning rewards on certain types of purchases. This will help narrow down your options. A high base earning rate is best for everyday use, while bonus rewards in your biggest spending categories may be preferable if you only plan to buy certain things.
- Calculate the dollar value of each card’s rewards. This will make it easier to do an apples-to-apples comparison of each offer.
You can check old bills to estimate how much you will spend – by category, if necessary. And you can determine the value of a card’s points or miles by comparing the number needed for a particular redemption item to that item’s price when purchased without rewards.
- Ask yourself how much hassle the most rewarding offer will add to your daily life. Jumping through hoops just to earn a few extra dollars in rewards might not be worthwhile, after all.
With all of that being said, there’s also a far easier way to find the best rewards credit card for your needs. Just sign up for a free WalletHub account
, and we’ll give you a personalized recommendation based on your latest credit score and your desired features.
Can I have more than one rewards credit card?
There is no rule against having more than one rewards credit card. It’s actually one of the best ways to maximize your earnings. No credit card is perfect, after all. So you won’t find a single rewards credit card that offers the highest possible earning rate on every purchase that you’ll make. But you can assemble a perfect collection of cards, each of which excels for a certain type of transaction.
For example, you could have a gas rewards card
for filling up your tank, a cash back card
for groceries and other everyday expenses, and a travel rewards card
for airfare and hotel reservations. You could even throw in a store card
or two for purchases at your favorite retailers.
This strategy is called the Island Approach
, and it can be applied to financing as well as rewards. For instance, you could have a card offering 0% on new purchases
for big-ticket buys that will take a while to repay, in addition to a 0% balance transfer card
for reducing the cost of existing debt.
The Island Approach isn’t for everyone, though. If you don’t feel comfortable managing more than one credit card account at a time, or you’ve found yourself missing payments and making other mistakes with just a single card, you’re probably better off not adding more plastic to the mix.
What are points on a credit card?
Points on a credit card are a rewards currency, like miles and cash back. Points credit cards, many of which are affiliated with hotel chains and airlines, reward you with a certain number of points for each dollar that you spend, usually depending on the types of purchases you make. For example, you might get 1 point per $1 spent on most purchases, except for airfare or hotel reservations, which could yield at least twice as many points.
These points are then redeemable for airfare, hotel reservations, gift cards, statement credits and more. Credit card points are generally worth about a penny apiece, but the value varies from card to card.
Where can I get cash back on a credit card?
Cash back credit cards reward you for every purchase that you make. So if you have a Visa or a Mastercard, you can get cash back at any merchant that accepts Visa or Mastercard. And if you have a store credit card, you can get cash back at whichever retailer your card is affiliated with. If your card’s rewards come in the form of points or miles, you can also redeem them for cash – whether in the form of a check or a statement credit – though you might sacrifice some value by doing so.
The only other way to get cash back on a credit card is by performing a cash advance. But doing so is a bad idea, as you will have to pay a hefty fee and interest will immediately begin to accrue at a high rate.
If you’re interested in earning cash rewards, you can check out WalletHub’s editors’ picks for the best cash back credit cards, here: https://wallethub.com/best-cash-back-credit-card/
How do I find the best credit card for me?
The key to finding the best rewards credit card for your needs is to convert everything into dollar terms. Calculate how much you are likely to earn per year with each card, based on your actual spending and payment habits, and pick whichever figures to be most lucrative. Or you can just sign up for a free WalletHub account
to get a personalized recommendation based on your credit standing and financial priorities.