Best Credit Card Rewards Programs

There is a big difference between simply getting a rewards credit card and finding the best offer for your needs. Finding any old rewards card is easy. Hundreds of offers are available, and even people with bad credit can qualify for some of them. But with numerous rewards currencies to choose from and various restrictions to watch out for, the best rewards card isn’t always so obvious.

To help people make truly informed choices, WalletHub compared every non-cobranded consumer rewards credit card from the 20 largest issuers (62 total offers). We evaluated each card’s eligibility requirements, rewards earning and redemption policies, and expected rewards value.

You check out our findings below, along with some tips for choosing the right rewards card. Some of the cards listed on this page originate from our partners, but that did not impact our conclusions. Card information was collected on May 28th, 2021, and is likely to have changed since.

Main Findings

 

Best Overall: Capital One has the best credit card rewards program for the sixth year in a row, earning an average WalletHub score of 92%.

 

Earning Potential: The best rewards credit card can yield up to $1,285 more than the worst rewards card over the first two years.

 

 

Strategic Redemption: Redeeming credit card rewards for merchandise is the best deal, yielding 7% more value than cash back, the worst option.

 

Earning Policies: Capital One, First National Bank of Omaha and Fifth Third Bank have the best earning policies, with no limits and no loss of rewards if you miss a payment.

 

Redemption Policies: Credit card companies seem content to continue using redemption restrictions to limit the cost of rewards programs. None scored above 76% for their redemption policies.

 

Eligibility & Transparency: Navy Federal Credit Union, BECU, PNC Bank and Discover set the clearest expectations by stating rewards terms and restrictions upfront.

 

Rewards Minimums: 58% of credit cards require cardholders to earn a minimum amount of rewards before redeeming.

Conditional Rewards: 27% of rewards credit cards have earning rates that vary based on amount spent or time period.

Best Rewards Credit Card By Issuer

WalletHub crunched the numbers, calculating how much the average person would earn with each card, after fees, over the first two years of use. We used a two-year timeframe to level the playing field between cards that offer first-year promotions (i.e., an initial bonus and/or a waived annual fee) and those that don’t.

*We considered all non-cobranded consumer rewards cards offered by each issuer. Detailed scoring for other cards considered in this report can be obtained by request.
**Bank of America: Customers enrolled in Preferred Rewards can increase their bonus by 25-75 percent, based on their banking relationship.

Remember, a card’s value figures to change based on your spending habits and the latest terms. Initial bonuses may be limited-time promotions, for example.

For more great offers, check out the complete list of WalletHub’s best rewards credit cards of 2021.

Back to Top

Tips for Choosing a Rewards Card

Credit cards with rewards aren’t one-size-fits-all. Neither are credit card rewards programs. But these tips will help you find the plastic (or metal) that’s tailor-made for your wallet.

1. Read Reviews – Your assumptions and preconceived notions about a credit card rewards program may be well-founded or way off base. You need to do some research to find out the real story, especially the latest news and info because rewards program policies change often. Reading customer reviews will give you a good sense of whether there are any hidden tricks or restrictions, how helpful customer service is, etc.

2. Check Your Credit Score – Most credit card rewards programs require good credit or better to qualify for a participating card. Some even require excellent credit outright. You can check your latest credit score for free on WalletHub.

3. Determine How You’ll Use It – Do you want a rewards card for all everyday expenses? Or do you want a card just for certain types of spending, such as travel purchases? It’s important to answer these questions early on because it will tell you what terms and types of cards to focus on. For example, some rewards cards offer a consistent earning rate across all spending categories. Others give you more value when you buy certain things or redeem a certain way.So figure out what exactly you’re looking for. Once you know that, it will be easy to decide whether a given credit card has what you need.

4. Consider Both Earning & Redemption Value – It’s impossible to evaluate a rewards credit card if you don’t know how much its rewards are worth. This is obvious with cash back credit cards, but it can be tough to tell with points and miles cards. The easiest way to see how much a credit card’s points or miles are worth is to compare the number needed for a particular item (e.g., a flight) to the cost of that item if purchased independently. For example, if you need 40,000 miles for a $400 flight, the miles would be worth a penny apiece.

5. Avoid Unnecessary Hassle – If you’re the forgetful type, stay away from cards with rotating bonus rewards categories. Such cards require you to sign-up for new bonus categories each quarter. And if you don’t, you’re unlikely to earn more than the market average that quarter.

6. When In Doubt, Think Cash Back – You’ll never have to wonder about the rate at which you’re earning rewards with a cash back credit card. You’ll never have to worry about rewards devaluation, either. After all, you’ll be earning rewards in terms of dollars and cents.It’s a different story with points and miles cards, however. It’s hard to tell how much they’re worth. And that’s partly because credit card execs can jack up the number needed for a free flight, hotel room, statement credit, etc., whenever they please.

7. Don’t Rule Out Annual Fees – Often times, cards with annual fees offer better initial bonuses and higher earning rates than free cards. So don’t discount a card simply because it charges a fee, especially if it’s low. Just make sure the extra rewards you’ll earn are worth more than the fixed costs you have to pay.

If you’re still not sure, you can also try WalletHub’s free CardAdvisor tool to get personalized recommendations.

Back to Top

Detailed Credit Card Rewards Program Policies

 

Back to Top

Methodology

This report analyzed the rewards credit cards offered by the 20 largest credit card issuers, by outstanding balances. Information about each issuer’s non-cobranded consumer rewards cards was collected from the issuers’ websites. Once data collection was complete, we scored each card using the rubric listed below, which is comprised of four main categories:

1. Eligibility & Transparency – Max 20 points
2. Earning Policies – Max 30 points
3. Redemption Policies – Max 20 points
4. Rewards Value Per $1 Spent – Max 30 points

We averaged the individual scores for each issuer’s cards to arrive at overall issuer scores, which we then converted to percentages. Finally, we reached out to the public relations department for each issuer to confirm our findings. Two issuers – namely, U.S. Bank and Fifth Third Bank – either did not meet our deadline for input or did not provide any feedback. BB&T partially confirmed our findings. Card information was collected on May 28th, 2021, and is likely to have changed since.

*Exception for cash back cards or cards marketed as "cash back" when the undisclosed redemption rates are lower than the advertised cash back redemption.

**Rewards Value Explanation:

We identified the best card from each issuer by calculating the two-year monetary value of each offer’s rewards (including initial bonuses), minus any annual fees.

When calculating the card’s rewards value, we picked the best redemption option – travel, gift cards, cash back or merchandise – and used the average value for that redemption option to convert rewards currency into dollar terms.

We used the following spending data from the U.S. Bureau of Labor Statistics, which you can find below, to calculate each card’s monetary value. Exact values were used whenever possible, but in certain cases – such as “Travel” – we combined categories such as “Airlines,” “Hotels,” “Other Lodging” and “Public and Other Transportation” to create a more digestible list. We assumed that half of one’s utility expenses would be charged to a credit card, as certain types – electric bills, for example – typically aren’t plastic plastic-eligible. “Other” spending represents the sum of small household spending categories: healthcare, apparel and housekeeping supplies, for instance.

Annual Consumer Spending By Category

Sources: U.S. Bureau of Labor Statistics (Consumer Expenditures in 2018 Report).

Ask the Experts

In search of more information to help consumers understand credit card rewards programs a bit better and ultimately pick the right programs for their needs, we posed the following questions to a panel of experts. You can check out their bios and advice below.

1. Why do you think 28% of Americans now say that COVID-19 changed the way they view credit card rewards?
2. Does it make sense to you that low-income households are 3x more likely to think that credit card rewards are not worth the hassle?
3. Are you surprised that 76% of people think cash back is the best kind of credit card reward?
4. The majority of people say they would never apply for a credit card with annual fees; are they making a mistake?
5. What advice do you have for the 1 in 4 people who think that credit card rewards programs are hard to use?

Audio for News Use:

 

• Audio Q&A