What are rewards credit cards?
The simplest way to explain rewards credit cards are cards that bring you benefits whenever you purchase something – anything from a new barbecue, a Transformers DVD, an office desk, or all of the seasons of 24!
Reward points or cash-back are given in exchange of purchases made by the cardholder. Different cards have different reward systems but they are most often based on a percentage of your expenditure.
Credit card rewards come in two main flavors – points and cash back. Along with these you’ll find exuberant travel rewards, hotel privileges, premium membership perks, and of course airline reward cards.
You need to pick the best cards based on how you use your card, your spending patterns and preferences. Here you’ll find a breakdown of the best credit cards for rewards in 2018.
Rewards Credit Cards Categories
Travel Rewards Cards: These cards are best suited for those who travel frequently or for those who are looking to make the most out of their travel expenses and upgrade airline seats, get discounts on tickets and at hotels, earn miles, and so on.
Free checked baggage, airport exclusive lounge access, lost luggage reimbursement, airline fee credit, trip cancellation/interruption insurance, auto rental/collision damage waiver are some of the benefits offered by travel cards.
You can use the travel card effectively if you utilize the sign up bonus and ensure you actually spend as well as pay back the amount within the stipulated amount of time. You need to actually use the particular airline or hotel, otherwise getting a loyalty travel card is of little use.
Hotel Rewards Cards: These cards are also aimed at those who use hotel services frequently. The card could be a general travel rewards card or co-branded with certain airlines.
You can get incredible perks and exclusive benefits at international destinations, enjoy luxury experiences at hotels, and earn high discounts or even free stays. Annual fees on these cards may be pricier than other categories so be sure that you will actually use the card before you commit.
Cash Back Rewards Cards: Earning cash back for all your purchases becomes easy with these types of cards. Your accumulated rewards can be checked into your bank account or can be made available to you in the form of a statement of credit.
It is crucial that you always pay in time every month and in full to reap the full benefits of cash back cards. A salient tip, try and use the card for as many transactions as possible but ensure that there are no hidden transaction fees so you don’t pay extra.
Store Rewards Cards: Brands and stores offer these cards to their customers all the time. The interest rates are higher than average but the perks are undeniably attractive – free shipping, preview sales, preference discounts, and exclusive access to events and so on.
Points on select merchandise, entertainment, travel, and gift cards are also included in this category. Again, maintain your credit and pay in full and in time every month to maximize benefits on store reward cards.
How the list of best credit cards of 2018 was compiled?
We’ve put together this list evaluating aspect such as credit card fees, advantage points for signing up, bonus cards, level of difficulty for redemption as well as redemption rate, promotions, and other significant factors.
The cards that have been mentioned here have earned their position because of their flexible point’s redemption process, sparkling offers when signing up, and attractive rate of rewards on all kinds of purchases.
In the Spotlight – The Best Credit Cards for Rewards – 2018
- Capital One® Venture® Rewards Credit Card: Topping the travel category
- Blue Cash Preferred Card from American Express: Best for general purchases
- Chase Sapphire Preferred®: Leader of the food and dining category
- Discover it® Cash Back: Best for handsome rewards in the first year of use
- Citi Double Cash Card: Unbeatable flat-rate money back
- Chase Freedom: Rotating cash back leader
- Gold Delta SkyMiles Credit Card from American Express: Frequent fliers’ best reward card
- Business Gold Rewards Card from American Express OPEN: Flying the highest in the business category
- Discover it® Secured: Bad credit category champion
- Blue Cash Everyday® Card from American Express: Second to none in the retail market
Our Top Picks for Best Reward Credit Cards for 2018 – Explained
Capital One® Venture® Rewards Credit Card: Reaching the Highest Peak in the Travel Category
At a glance: Among all travel-friendly credit cards, the Capital One Venture Rewards credit card tops the list because of its flexibility. You need an excellent or good credit score to be eligible for this card. The APR varies from 14.74% to 24.74%. The annual fee is waived in the first year and $95 going forward.
Perks: You pay no annual fee for the first year and add 2 miles to your account every time you spend $1. You can fly any airline and stay at any hotel and have your points redeemed. There’s no restriction whatsoever and you can even redeem the card for a small payment of $5.
No minimum redemption limit. You also receive a bonus when registering – a hefty 50,000 miles when you spend $3,000 within the first three months of signing up. The unlimited rewards system can potentially earn you 10x miles when you pay with your Venture card.
So, spending $3,000 a year can earn you 72,000 miles every year!! The card has other perks including complimentary upgrades as well as huge discounts on resorts and spas. When renting an eligible vehicle when traveling you obtain automatic coverage for theft or damage due to a collision.
Verdict: The card is tough to beat in the travel category – it provides a wide margin of flexibility with no spending limits or fees. Every time you spend money you get add flat-rate miles and can capitalize on bookings through Hotels.com.
Blue Cash Preferred Card From American Express: Best for General Purchases
At a glance: This American Express card is highly beneficial for those who use their credit cards for general shopping at supermarkets and department stores in the US.
You get 6% cash back (on up to $6,000 per year, then 1%). This is valid at gas stations and select supermarkets. It has a low intro APR of 0% for the first year valid for balance transfers and purchases. The variable rate is 14.74% to 25.74%.
Perks: If you’re looking for a card with the highest reward rate to use at supermarkets and department stores then this is it.
Your 6% cash back can be extended to restaurants, retailers, or for buying gift cards. The sign up bonus of $200 after spending $1,000 in the first three months is a plus point and you may also find yourself making the cut for other offers from American Express.
You can accelerate cash back by getting additional cards for your family members and friends – increasing the reward benefits on their cards as well as yours.
You will also get additional benefits on accidental damage to your phone with Purchase Protection. Amex ShopRunner enrollment will bring you 2-day free shipping on eligible purchases at more than 140 online stores.
Verdict: The annual fee of the Blue Cash Preferred Card is high at $95 but if you are a serious spender at supermarkets then this card is a winner. You need to consider the 2.7% transaction fee overseas which may be less than ideal for using this card abroad. The travel, shopping, and entertainment benefits on this card make it valuable.
Chase Sapphire Preferred®: Leader of the Food and Dining Category
At a glance: The card by Chase is ideal for dining but you need an excellent or good credit score to be eligible for it. The reward rate will be doubled if you this card for dining and travel and it will be 1x for all other expenses. The APR is variable from 17.49%-24.49% and the annual fee is waived for the first year, $95 thereafter.
Perks: The standout feature of this card is when you redeem your points on Chase’s website. Your reward points’ value increases by 25% so you will benefit by booking travel through Chase Ultimate Rewards rather than by using your points as statement of credit.
The sign up bonus is superb – when or if you spend $4,000 within 3 months of signing up you earn 50,000 bonus points. Points can be transferred to other loyalty programs on partner airlines.
This card earns you 2x points on travel and dining and an additional 1 point on every dollar spent for other purchases. Additional benefits include 1:1 points transfer, zero foreign transaction fees, and travel/purchase coverage. All stellar benefits in one package.
Verdict: The sign-up bonus, 2x points on dining, flexibility on points transferring, and 25% benefit on bookings through Chase’s portal makes this card popular for those frequent travelers. Best suited for those looking to earn and redeem their rewards in the dining and travel category.
Discover it® Cash Back: Best For Handsome Rewards in the First Year of Use
At a glance: Reap the best out of your reward points gathered in the first year with this card. You can earn 5% cash back extending to an amount of $1,500 valid for expenditures in different categories. On all other purchases you get 1% cash back. This card has no annual fee and you can redeem your cash back any time you want and for any amount. It has no expiry date.
Perks: The rotating category cash back system enables cardholders to get 5% cash back at gas stations, retailers, online stores, and restaurants. It comes with 5% rewards for expenditures of $2,500 per quarter, 1% thereafter.
The best part is that the Discover It Cash Back credit card has no overseas transaction fee and your first late payment fee is automatically waived.
The icing on the cake is that your first year cash back rewards will be matched by Discover at the end of the year – so double the benefit on your one year anniversary of being a Discover It Cash Back card owner. There is no limit of how much cash back that can be matched by Discover. This card has a 100% US based customer service network available 24/7.
The rotating categories for 2018 are January-March: wholesale clubs, gas stations; April-June: grocery stores; July-September: restaurants; October-December: Amazon.com and wholesale clubs. As a cardholder you can check your FICO score at no additional cost anytime.
Verdict: The reward structure system might be a little complicated than other flat-rate cash back credit cards, but the generous introductory offer of doubling your rewards at the end of the first year is unbeatable. The card doesn’t charge any interest for the first 14 months and there’s no annual fee which makes this one of the best cards in its category.
Citi Double Cash Card: Unbeatable Flat-Rate Money Back
At a glance: This card is best for flat-rate cash back. It has a simple reward rate of 1% on every purchase and additional cash back of 1% on payment of your bill. The APR is variable between 15.24% and 25.24%. There is no annual fee and it doesn’t really give you any special welcome or intro offer.
Perks: Earning cash back twice is the big advantage on this card – 1% on purchase and 1% on payment. A total of 2% flat-rate cash back is among the highest rates for unlimited rewards and that itself makes this card stand out.
Some people want hassle-free credit card reward systems as they lack the patience or time to track what they are spending where, whether they match the categories and if they are within their spending caps. Redeeming cash back is easy and you can either get the amount checked or get statement credits.
The regular privileges for Citi customers also prevail – you can get special access to buy tickets to exclusive events, presales, VIP packages, movie screenings (Sicario, Horrible Bosses, Transformers, Fast and Furious, Jason Bourne, Blood Diamond, and other brilliant movies of this ilk) and so on.
Verdict: The Citi Double Cash Card is a great add on if you’re already experienced in credit card rewards as it will complement your other reward cards.
If you have just started using reward cards even then this card is a good option. 1% outright and 1% on bill payment give you double the benefit for every purchase you make and that puts this card high up in the cash back rewards category.
Chase Freedom: Rotating Cash Back Leader
At a glance: This card is best for rotating cash back giving you 5% cash back up to the value of $1,500. The categories are rotated every quarter and purchases outside the category still gets you 1% cash back. The card has no joining or annual fee.
A card with profound potential of earning you high value cash back rewards, the Chase Freedom is a judicious choice. 16.49%–25.24% variable APR from the 16th month onwards, first 15 months have 0 APR.
Perks: With the Chase Freedom card you have the potential of earning $74 every quarter with the 5% reward rate on select categories.
If you maximize this opportunity you can earn at least $300 a year which, for a card with no annual fee, is an excellent thing in itself. Once you spend $500 within the first three months you receive $150 as a welcome offer bonus.
You can redeem your rewards at any time they are accessible as long as your account is open. There is no minimum amount for the cash back you can redeem. You can also shop with your points on Amazon.com or get a variety of gift cards for shopping, dining, or entertainment.
If you hold a Sapphire Preferred or Sapphire Reserve card then you have the advantage of converting your Freedom card cash into better benefit points. For July – September the category that will earn you 5% cash back is gas stations.You need to activate this by 14th September 2018.
Verdict: If you’re a person who is meticulous in keeping track of spending and categories in order to maximize your cash back rewards then this card is for you. It has some potential for anyone who uses gas stations, supermarkets, department stores, and so on – which is pretty much everyone. There are plenty of benefits without any annual fees. That’s cool!
Gold Delta SkyMiles Credit Card From American Express: Frequent Fliers’ Best Reward Card
At a glance: Delta fliers, this is one card you must apply for, if you already haven’t. For every $1 you spend on any Delta purchases you will earn 2 miles on this card.
A dollar spent on any other purchases gets you 1 mile. SkyMiles loyalty members have an added advantage of earning 7 miles for every dollar spent. The Gold Delta SkyMiles Credit Card comes with an annual fee of $95 and a variable APR of 17.49%-26.49%.
Perks: Make sure you spend $1,000 within the first three months and you’ll get 35,000 bonus miles as a part of your welcome offer.
Adding to that, you’ll get $50 statement credit after any purchase you make at Delta. Get additional travel benefits in numerous ways including priority boarding, discounted Delta Sky Club access, 20% in-flight savings, car rental loss and damage protection, and up to $50 benefit by checking in your first bag free on any round-trip Delta flight.
A salient benefit is that there is no limit to how much you can earn from travel as well as everyday purchases, and redemption can be done on Delta as well as 15 partner airlines. Shopping and entertainment benefits are part of the package too.
Verdict: All in all the Gold Delta SkyMiles Credit Card from American Express card is a Delta frequent flier’s dream come true. Never before has booking co-branded flights brought so much value for a passenger. If you’re loyal to Delta you should maximize the benefits that this card has to offer.
Business Gold Rewards Card from American Express OPEN: Topping the Business Category
At a glance: A premium card with a rather high annual fee but the features it offers, perks, and rewards more than compensate for the above average fee for most businesses. Of the five specified you can choose one category for your business and reap 3x the reward points on that category.
This Amex card has no APR and you need to make monthly payments. A Pay Over Time feature is also available but one needs to be eligible for it. The annual fee is $175 from the second year onwards, first year being free.
Perks: This card garners your business a 5% discount at Hertz and FedEx, among others. Apart from the 3x points gained in one category of your choice, you also get 2x points in the other four categories and you can gain 1x points on everything else.
You also get 2x points on the Amex travel portal. One of the advantages is the attractive welcome offer of 50,000 reward points when you spend $5,000 in the first three months of signing up.
Among the many membership benefits of this premium card are the baggage insurance plan, premium roadside assistance, car rental loss and damage protection, purchase protection, extended warranty, travel accident insurance, and various other Amex offers. Points can be transferred to select frequent traveler programs.
The Business Tools of this card are a stand out feature. Employee cards earn you more rewards and also helps you track how much they are spending.
Verdict: If your business has major expenses in a few categories such as gas, shipping, advertising, software, or airfare then the Amex Business Gold Rewards Card is a must have. The points are flexible and it gives additional discounts with certain brands. Overall, a fabulous reward card for businesses.
Discover it® Secured: Bad Credit Category Leader
At a glance: The Discover It Secured card is best for bad credit for more than one really good reason. A bad credit or no credit score holder is eligible for this card and the best part is that this actually helps you build up your credit as time marches on.
There are no hidden fees that one would expect with cards offered to those holding bad credit or no credit. There is no annual fee and the APR is variable at 24.74%.
Perks: One of the best things about the Discover It Secured rewards card is that your account is reviewed by them in eight months and if you are eligible you are bumped up to an unsecured rewards card system. So use it well and you’ll automatically reach a notch higher. .
If you use this card at restaurants and gas stations you get 2% cash back capping at $1,000 while all other purchases will earn you 1% cash back. What’s more, you will earn back exactly double of all your cash back at the end of the first year – this is Discover’s undeniably good welcome offer.
Some of the additional perks of this card include viewing your FICO credit score for free, free social security number alerts, and a refundable security deposit. Also note that late payment wouldn’t make a difference to your APR.
Verdict: Even though this card has a credit limit of $2,500 and requires a security deposit of $200, the benefits and perks are excellent for anyone with bad or no credit. Earning decent cash back and building some credit are the greatest advantages of this card.
The automatic periodic reviews to upgrade the cardholder to a no-security-deposit-account are also noteworthy. Use this card responsibly and build your credit history.
Blue Cash Everyday® Card from American Express: Magnificent in the Retail Market
At a glance: A card that is one of the best for everyday spending, the Blue Cash Everyday should be the top choice for families for normal spending without any annual fees. Works best for spending at retail stores, grocery stores, gas stationsk, and select US department stores.
It has a variable APR at 14.74% to 25.74% and you do need a good or excellent credit score to be eligible for it. It beats many reward cards in the same category with its high cash back rates and straightforward earning system.
Perks: The Blue Cash Everyday Card gives you 3% cash back rate at all US supermarkets. This caps at $6,000 per year and then gives cash back of 1% on all grocery purchases. At gas stations and certain department stores you will get 2% cash back while all other purchases will give you 1%.
There is no annual fee which is awesome since you can earn significantly if you are spending regularly on groceries and gas. It offers payment flexibility and you can forward your balance with interest or make a full payment every month. This is beneficial if you are juggling your finances or suddenly have to make a large purchase.
You can accelerate obtaining cash back by adding family and friends and getting them cards as well. Their points will earn you rewards and you can also benefit when paying your phone bill and so on. The Blue Cash Everyday Amex card extends to certain travel benefits as well as shopping and entertainment benefits.
Verdict: A leader in this category, the Blue Cash Everyday card is ideal for everyday use for families. It correlates with clear benefits at literally no cost at all.
Redeeming Your Credit Card Rewards
There’s no point of accumulating lots of reward points if you fail to redeem them. There are multiple ways of redeeming rewards actually based on what your particular card type offers. You can book tickets, hotels, or redeem them with a statement of credit. You may also transfer your rewards to eligible hotel loyalty programs or airline benefits.
Cash-back rewards can be deposited into your bank account or taken as a statement of credit. On the other hand you can make partial payments while booking trips or hotels. You could also redeem this credit for gift cards at retailers or use them as credit to make a purchase at a store.
Also remember, certain rewards can be transferred to another user to redeem or they can be donated to a partner charity. What you do with your points is entirely up to you. Using them smartly can help you in business, travel, leisure, and for gifting purposes.
Using Your Rewards Cards Strategically
Reward points are the carrot on a stick, an incentive for you to use your card as much as possible. But remember to spend responsibly. Earning reward points shouldn’t be the only reason for using your credit cards.
You will benefit from your card and earn points if you use them judiciously. If you spend more than you can pay back in time and in an interest-free manner or with the lowest interest possible, you might end up struggling to maintain decent credit. You can actually hurt your credit score.
So be alert and aware of all the key terms of all the credit cards you hold, make sure you comply and use them wisely for a variety of sound reasons. You don’t want to backward with these card/s, you want to go forward. You can have the best of both worlds if you have a solid plan in place.
You need to decide what type of spender you are and where do you like to spend your money. Check your credit report carefully for any errors or discrepancies that can occur. Choose the right card/s and have fun! And be responsible!
Quickly Recapping Our List of Top Credit Cards for Rewards in 2018
- Capital One® Venture® Rewards Credit Card
- Gold Delta SkyMiles Credit Card from American Express
- Chase Sapphire Preferred®
- Blue Cash Everyday® Card from American Express
- Cash Back
- Citi Double Cash Card
- Chase Freedom
- Business Gold Rewards Card from American Express OPEN
- Blue Cash Preferred Card from American Express
- Discover it® Cash Back
- Bad Credit
- Discover it® Secured: Bad credit category topper