Rewards Credit Cards

The biggest difference between cash back and points – two of the three major types of credit card rewards, along with miles – is that points have a value set by the credit card issuer. And they won’t always tell you what that is, at least not clearly. You can spend points for many different things, but cash back will always be more versatile and consistent, as there are no restrictions on what you can use it for. Cash back is real money and, as such, keeps its value.

But points can still be better for people who like to travel. That’s because a lot of points credit cards give more points for travel purchases and offer the best value when you redeem those points for travel. You can usually redeem points for not just travel, but also cash back, merchandise, or charitable donations. But you’ll typically get much less for the non-travel options.

Cash Back vs. Points: What’s the Difference?

• Options: Citi Double Cash is your best bet for a cash back card, while  Chase Sapphire Preferred is best for points.
• Rewards: You’ll probably earn 1% cash back or 1 point per $1 spent on most purchases. Credit card points are usually worth about a cent each, so they’re about even on average.
  
• Drawbacks: Points can be devalued by the credit card issuer, and they can be redeemed for fewer things. Cash back cards may hold back frequent travelers from getting as many rewards as they could with a points card.

Let’s take a look at two high-profile cards for examples of the best cash back and points rewards. Citi Double Cash tops the cash back offerings with 2% cash back on all purchases and 18 months of no interest on balance transfers. It also doesn’t charge an annual fee, and requires good credit to get.

But if you have excellent credit and you’re a frequent traveler, Chase Sapphire Preferred is a more attractive option. It gives 2 points per dollar on travel purchases and 1 on everything else. It has an initial bonus of 50,000 points when you spend $4,000 in the first 3 months. Points are worth 1 cent each normally or 1.25 cents when you redeem them for travel. There’s a $95 annual fee, which is waived the first year. It requires excellent credit.

For both cash back and points cards, you can expect to lose your rewards if your account closes for any reason. Most cards don’t let your rewards expire over time, although Citi Double Cash’s cash back expires if you don’t use your card for 12 months. And on points cards alone, your points can be devalued if the issuer decides to charge more points for its rewards, so frequent redemption is essential.

So the bottom line is frequent travelers should check out points cards. Otherwise, cash is king.

The best $500 credit card bonus offer is the Capital One Venture Rewards card, which gives 50,000 bonus miles worth $500 in travel when you spend $3,000 in the first 3 months. After that, the card keeps the rewards flowing with 2 miles per $1 on all purchases. There’s no annual fee for the first year, but the card charges $95 after that.

Chase Sapphire Preferred and Reserve are two other cards in the running for best $500+ credit card bonus. Each offers 50,000 points when you spend $4,000 in the first 3 months. That’s worth much more than $500 when used toward travel. They offer 2-3 points per $1 on travel and dining and 1 on other purchases. So while they give lots of rewards, the overall rate isn’t as high as Venture.

If you own a business, there’s a rare $500 credit card bonus available in cash from Capital One Spark Cash for Business. You’ll need to spend $4,500 in the first 3 months to get it. But that’s not too hard with business expenses.

All of the $500 credit card bonus offers require you to spend at least $3,000 in the first few months to qualify. And all of the cards require good or excellent credit to get in the first place. And you’re also far more likely to get $500 worth of miles or points than cash.

Here’s are some options for a $500 credit card bonus:

• $500 credit card bonus: Capital One Venture. 50,000 bonus miles for spending $3,000 in the first 3 months. That’s worth $500 in travel. You need good credit and the annual fee is $95, waived the first year.

• $500-$625 credit card bonus: Chase Sapphire Preferred. 50,000 bonus points for spending $4,000 in the first 3 months. That’s $500 toward most rewards or a whopping $625 toward travel. You’ll need excellent credit and have to pay a $95 annual fee, which is waived the first year.

• $500-$750 credit card bonus: Chase Sapphire Reserve. 50,000 bonus points for spending $4,000 in the first 3 months. Those points are worth $500 toward most rewards or $750 in travel. The card requires excellent credit and charges a $450 annual fee.

• $500 credit card bonus: Capital One Spark Cash for Business. $500 cash bonus for spending $4,500 in the first 3 months. This card requires good credit and has an annual fee of $95, which is waived the first year.

• $600 credit card bonus: Barclaycard Arrival Plus. 60,000 bonus miles for spending $5,000 in the first 90 days. These miles are worth $600 in travel. You need good credit to get this card and there’s an $89 annual fee.
  

• $750 credit card bonus: Barclaycard Arrival Plus. 60,000 bonus miles for spending $5,000 in the first 90 days. These miles are worth $600 in travel. You need good credit to get this card and there’s an $89 annual fee.
  

• $600 credit card bonus: Southwest Airlines Rapid Rewards Premier. 40,000 bonus points for spending $1,000 in the first 3 months. Since Rapid Rewards points are worth around 1.5 cents each, that’s a $600 value. This card requires excellent credit and has a $99 annual fee.

Capital One Venture gives the best $500 credit card bonus, especially when you consider its other benefits. But several cards give bonuses worth even more. It’s good to shop around and find the card that best fits your needs.

Two of the best double miles credit cards are the Barclaycard Arrival Plus World Elite Mastercard and the Capital One Venture Card. Both cards offer double miles on all purchases, and each waives its annual fee the first year. Arrival Plus charges $89 starting the second year, and Venture charges $95. But Arrival offers a bigger initial bonus: 60,000 miles for spending $5,000 in 90 days vs Venture's 50,000 miles for spending $3,000 in three months. Venture also gives you 10x miles at hotels.com.

Of course, the best double miles card for you is a highly personal decision. Depending on how much you travel and which airline your normally use, another card could be your best bet.

Here are the best double miles credit cards:

• Capital One Venture Rewards Card: Double miles on all purchases. $95 annual fee, waived for your first year. 50,000 miles for spending $3,000 in your first three months. 10 miles per $1 at hotels.com. You need good credit to get this card.

• Barclaycard Arrival Plus World Elite Mastercard: Double miles on all purchases. $89 annual fee, waived for the first year. 60,000 miles for spending $5,000 on purchases in your first 90 days. 5% rebate whenever you redeem your miles. You need excellent credit to get this card.

• Lufthansa Mastercard: Double miles on tickets purchased directly from Lufthansa and partner airlines. $89 annual fee. 20,000 bonus miles for making your first purchase and 30,000 more for spending $5,000 in the first 90 days. 1 mile per $1 on non-airline purchases. You need good credit to get this card.
• Asiana Credit Card: Double miles on all purchases. $99 annual fee. 30,000 miles for spending $3,000 in your first 90 days. 3 miles per $1 for Asiana tickets, 1 for everything else. 10,000 bonus miles, a $100 credit for an Asiana ticket and 2 Asiana Airlines lounge vouchers every year when you renew your card. This card requires good credit.

• JetBlue Plus Card: Double miles on restaurants and groceries. $99 annual fee. 40,000 bonus points for spending $1,000 in your first 90 days. 6 points per $1 on JetBlue purchases, 1 everywhere else. 10% of your points back when you redeem them for JetBlue flights. This card requires good credit.

• Gold Delta SkyMiles Credit Card from American Express: Double miles on Delta purchases. $95 annual fee, waived the first year. Until 4/11/18, earn 50,000 miles for spending $2,000 in your first three months, along with a $50 statement credit for making a Delta purchase. If you spend another $1,000 in purchases in your first 6 months, you’ll get an extra 10,000 points. 1 mile per $1 on all non-Delta purchases. This card requires good credit.

• Citi AAdvantage Platinum Select World Elite Mastercard: Double miles on American Airlines purchases. $95 annual fee, waived for the first year. 40,000 miles for spending $2,000 within three months of opening an account, plus another 10,000 miles for spending a total of $6,000 in the first 12 months. 1 mile per $1 on all American Airlines purchases. This card requires good credit.

Keep in mind that the best double miles credit cards tend to require good or excellent credit. But if your credit isn’t quite at that level yet, you can still get double miles. The AeroMexico Secured Visa offers 2 miles per $1 on gas and groceries (1 mile per $1 everywhere else). And the annual fee is only $25.

The best rewards credit card for fair credit is the Capital One® QuicksilverOne® Cash Rewards Credit Card, thanks to its generous earning rate and the simple fact that people with fair credit can get it. The truth is that rewards credit cards for fair credit are few and far between. And while some credit cards for people with fair credit do offer rewards, rewards should not be your focus at this point in your credit career. Your main objective should be to find a credit card with no annual fee that you can get approved for.

Once you’ve narrowed down your options, you can use rewards or low interest rates as the tiebreaker for the remaining offers. Rewards are best for people who pay their monthly credit card bills in full, while a low rate will likely offer more savings to those who foresee carrying a balance from month to month.

A Visa rewards card is any credit card on the Visa network that offers cash back, miles, points for each purchase that you make. Visa rewards credit cards are issued by many different credit card companies, as card networks such as Visa and MasterCard simply dictate where a card can be used and what secondary perks (e.g. rental car insurance) it may offer. You can compare the best Visa rewards cards at: https://wallethub.com/credit-cards/rewards-visa/