Picking the right credit card may feel overwhelming. There are so many different options that it's hard to know which is best for you.
To relieve some of the stress, we analyzed 111 popular rewards cards using an average American's annual spending budget and digging into each card's perks and drawbacks to find the best of the best based on your consumer habits. (See our methodology for more information on how we choose the best cards.)
You don't have to be an aggressive points optimizer to enjoy the perks that come with a good rewards credit card. With the right card and good financial habits (paying your balance off on time and in full each month), you can earn $2,000 or more in rewards over five years (and that's after the annual fee). That breaks down to roughly $400 to $500 a year (a little higher the first year if you take advantage of a welcome bonus), and it's money you can use to buy more groceries, book airline travel, or splurge on a new iPad.
Many of these cards also provide additional perks, such as discounts at select retailers, travel insurance, annual statement credits and more that make using a rewards card truly worthwhile.
Here are CNBC Select's picks for the top rewards credit cards:
4X Membership Rewards® points when you dine at restaurants worldwide and shop at U.S. supermarkets (on up to $25,000 per year in purchases, then 1X), 3X points on flights booked directly with airlines or on amextravel.com, 1X points on all other purchases
35,000 Membership Rewards® points after you spend $4,000 on eligible purchases within the first 3 months from account opening
See rates and fees
See rates and fees
Who's this for? If you love food, the American Express® Gold Card could be the ideal rewards card for you. Whether you dine out or cook at home, this card earns a competitive 4X points per dollar spent at restaurants worldwide and 4X points at U.S. supermarkets (on up to $25,000 per year in purchases, then 1X). Plus, travelers can benefit from the 3X points on flights booked directly with airlines or on Amextravel.com.
The value of Membership Rewards® points varies depending on how cardholders redeem them. You can use them in a variety of ways, from paying with points at checkout at retailers like Amazon to redeeming for gift cards or a statement credit to booking travel. (See more on how the value of points is calculated.)
Cardholders also receive an annual dining credit of up to $120 ($10 a month) at Grubhub, Seamless, The Cheesecake Factory, Ruth's Chris Steak House, Boxed and participating Shake Shack locations (activation required). Travelers can take advantage of an annual $100 airline fee credit to cover the cost of in-flight food and beverages, seat upgrades and baggage fees. There are also no foreign transaction fees.
This card does have a $250 annual fee, but it can easily be offset if you take advantage of all the added card benefits. Just using the $120 dining credit and $100 airline fee credit each year effectively reduces the fee to $30. Then, the rewards you earn help further "pay" for the card.
Gold Card members can also participate in Amex Offers, where you can earn statement credits or bonus Membership Rewards® points at select retailers. For example, an offer for Wine.com states: "Spend $50 or more, get $10 back." These limited-time offers are location-based and additional terms apply.
5X miles on hotel and rental cars booked through Capital One Travel℠, 2X miles per dollar on every other purchase
50,000 bonus miles once you spend $3,000 on purchases within the first 3 months from account opening
N/A for purchases and balance transfers
17.24% to 24.49% variable on purchases and balance transfers
3% for promotional APR offers; none for balances transferred at regular APR
Who's this for? The Capital One® Venture® Rewards Credit Card offers the best rewards rate on select hotel purchases: Earn 5X miles on hotel and rental cars booked through Capital One Travel℠ , which is a great flat rate. Plus earn 2X miles per dollar on every other purchase.
While Venture does come with a $95 annual fee, it's low compared to some other rewards cards, with some annual fees up to $550.
In addition to rewards, every four years cardholders receive a credit for a Global Entry or TSA PreCheck application, up to $100. If you travel often, this is a great perk that can save you time and money.
This card has no foreign transaction fees and comes with a bunch of additional travel perks, such as travel accident insurance, 24-hour travel assistance services and an auto rental collision damage waiver.
2.5% cash back on all purchases (up to $250 in cash back rewards per billing cycle)
$99, waived the first year
12.24% to 22.24% variable
Who's this for? The Alliant Cashback Visa® Signature Credit Card, our top cash-back card with an industry-leading 2.5% cash back on all purchases (up to $250 in cash back rewards per billing cycle), is ideal for anyone looking for an easy-to-use rewards card. There are no bonus categories or activation required, so this card is a simple way to maximize cash back on everyday spending.
This card doesn't have many of the bells and whistles that other cards on this list have, but it does offer a competitive 12.24% to 22.24% variable APR. Compared to other rewards cards, this is in the low range, which may be helpful if you happen to carry a balance month-to-month. (We recommend you always pay on time and in full.)
While this card has a strong cash-back program, it does come with a $99 annual fee (though it's waived the first year). It's not the highest when compared to other rewards cards, but you can find a range of cash-back cards with no annual fees.
You also have to become a member of Alliant Credit Union and open an account in order to qualify for this card. The easiest way to become a member is by supporting Alliant's partner charity, Foster Care to Success. You don't need to pay the charity directly — Alliant pays $5 on your behalf when you apply to join the credit union. Membership is also open to family members of current members, employees of partner organizations or those who live or work in qualifying towns and communities near Chicago's O'Hare International airport.
Overall, the numbers indicate that it's worth it to overcome these relatively minor obstacles in order to get the card's generous cash-back rate on all your purchases. If you don't want to make that trade off, though, there are a number of other strong cash-back options that don't require you to join a credit union.
10X points on Lyft rides through March 2022, 3X points on travel worldwide (immediately after earning your $300 annual travel credit), 3X points on dining at restaurants worldwide, 1X point per $1 on all other purchases
50,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening — worth up to $750 toward travel when you redeem through Chase Ultimate Rewards®
16.99% to 23.99% variable
5%, minimum $5
Who's this for? If you're a frequent traveler looking to make your flights and hotel stays more luxurious, the Chase Sapphire Reserve® should be on your radar. This card is geared toward frequent travelers with 3X points on dining and travel worldwide and no foreign transaction fees.
The value of Chase rewards points varies depending on how you use them. If you redeem points for cash and gift cards, each point is worth $.01, which means that 100 points equals $1 in redemption value. (See more on how the value of points is calculated.)
When you use points through Chase Pay® for a statement credit to cover all or part of a purchase made at participating Chase Pay® merchants (Amazon, for instance), each point is worth $.008, which means that 100 points equals $.80 in redemption value. Redemption values for other reward options may be worth more or less than this.
The value of points increases 50% when you redeem for travel on Chase Ultimate Rewards®. For example, 50,000 points are worth $750 toward airfare, hotels, car rentals and cruise reservations when you redeem through Chase Ultimate Rewards®. This is a great way to maximize the value of your rewards and makes this card stand out from the pack.
While this card offers great rewards and benefits, it does come with a hefty $550 annual fee. However, if you take advantage of all the annual credits, you can come out well ahead of the fee. There's an annual $300 travel credit, as well as a $100 credit for Global Entry or TSA PreCheck application fees cardholders can redeem every four years. And the Priority Pass™ Select membership, which gives you access to more than 1,000 lounges in 500 cities worldwide, has a value of about $429.
6% cash back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%), 6% cash back on select U.S. streaming subscriptions, 3% cash back at U.S. gas stations, 3% cash back on transit including taxis/rideshare, parking, tolls, trains, buses and more and 1% cash back on other purchases
$250 statement credit after you spend $1,000 on eligible purchases on your new card within the first 3 months
0% for the first 12 months on purchases, N/A for balance transfers
13.99% to 23.99% variable
Who's this for? The Blue Cash Preferred® Card from American Express is a great choice for anyone who regularly spends big at grocery stores and gas stations. The rewards program is tailored to these purchases and offers some of the best cash-back rates available.
Cardholders who have cut the cord can also take advantage of high cash back on select U.S. streaming services (6%). The list of eligible streaming subscriptions is longer than most, including Audible, Kindle Unlimited, MLB.TV and more.
In addition to cash back, cardholders can earn statement credit at select businesses through Amex Offers. For example, you can spend $75 or more and get $15 back at Jane restaurant in New York City. These limited-time offers are location-based and additional terms apply.
While cardholders only earn 1% cash back for travel-related purchases, you can benefit from travel perks, such as car rental loss and damage insurance. However, this card isn't the best choice for traveling outside the U.S., since purchases made abroad incur a 2.7% fee.
2% cash back: 1% on all purchases and an additional 1% after you pay your credit card bill
No current offer
0% for the first 18 months on balance transfers; N/A for purchases
13.99% - 23.99% variable on purchases and balance transfers
3%, minimum $5
Who's this for? The Citi® Double Cash Card is a solid choice if you're looking to maximize your money without having to worry about rotating rewards categories or joining a credit union. Earn 1% cash back on all purchases and 1% when you pay off your bill.
There's no annual fee and an easy-to-use cash-back program with no activation required and no limit to how many points you can earn. Cardholders can redeem cash back for checks or statement credits once they've earned $25 worth of points. Plus, if you forget to pay your card, Citi will waive your first late fee. (Though we always recommend you pay off your card on time and in full each month.)
Although this card doesn't have a welcome bonus, the Citi® Double Cash Card offers cardholders a 0% APR for the first 18 months on balance transfers initiated within four months of opening an account. After the intro period ends, there's a 13.99% to 23.99% variable APR.
In addition to the cash-back rewards, there are a number of special cardmember programs, including Citi Entertainment℠, which gives cardholders first access to purchase tickets for thousands of concerts and events. The card also provides access to Citi® Identity Theft Solutions, a service that will help you if you're a victim of identity theft.
3X points on dining out and ordering in; gas, rideshares and transit; flights, hotels, homestays and car rentals; and popular streaming services. 1X points on all other purchases
20,000 bonus points when you spend $1,000 in purchases in the first 3 months
0% APR for 12 months on purchases and qualifying balance transfers
14.49% to 24.99% variable on purchases and balance transfers
Introductory fee of 3% ($5 minimum) for 120 days, then 5% ($5 minimum)
Who's this for? The Wells Fargo Propel American Express® Card has a strong rewards program for a no annual fee card: Earn unlimited 3X points on gas, dining out and ordering in; rideshares and transit; flights, hotels, homestays and car rentals; and popular streaming services; plus 1X point on all other purchases.
This card is a smart choice for all types of travelers, whether you like to fly, drive or take mass-transit. And this card not only gives you 3X points at gas stations but also on purchases at toll bridges and highways, parking lots and garages. And you earn a competitive 3X points on restaurants and take out, which is great while you're traveling. When you're ready to relax, you can enjoy 3X points on select streaming services.
Wells Fargo makes it easy to redeem points for cash, gift cards or travel. There are no black-out dates when you make reservations through Go Far Rewards, but you can't start redeeming points until you've earned 2,500.
In addition to rewards, this card offers no interest on purchases and balance transfers for a full year (then 14.49% to 24.99% variable APR). If you have large upcoming expenses or debt on a non-Amex card, the Wells Fargo Propel American Express® Card provides a way to finance new and old debt without incurring interest charges. Balance transfers are charged a 3% fee, $5 minimum.
There's also cell phone protection for damage to or theft of your phone up to $600 per claim and $1,200 per 12-month period ($25 deductible applies and you must pay your bill with your Wells Fargo Propel American Express® Card).
5% cash back at Amazon.com and Whole Foods Market; 2% back at restaurants, gas stations and drugstores; 1% back on all other purchases
$70 Amazon.com gift card upon approval
$0 (but Prime membership is required)
14.24% to 22.24% variable
5%, $5 minimum
Who's this for? Frequent shoppers on Amazon and at Whole Foods will want to look into the Amazon Prime Rewards Visa Signature Card. All purchases made by Prime members at Amazon and Whole Foods get a robust 5% cash back. The card also offers a $70 Amazon.com gift card upon approval as a one-time bonus.
In addition to the generous 5% cash back at those two retailers, the card gives users 2% back on purchases made at restaurants, gas stations and drugstores and 1% back on all other purchases.
As the name implies, you must have an eligible Prime membership to apply for this card ($119 for an annual membership and $12.99 for a monthly membership). If you don't, opt for the Amazon Rewards Visa Signature Card, which doesn't require a Prime membership and still offers 3% cash back at Amazon and Whole Foods.
Rewards credit cards come in all shapes and sizes, so it's important to take some time to choose the best card for your needs. You should decide if you're willing to pay an annual fee for a card, since this can help narrow down choices. Rewards cards can have annual fees up to $550, which can be worthwhile, but not for everyone. Make sure you do the math to see if an annual fee is within your budget and if it can be outweighed by the card's benefits.
Don't want to pay your credit card's annual fee? Here's how to ask for a retention offer
Next you should figure out what type of rewards you want to earn and if you want a simple rewards program or one that may require some work. If you want a straightforward card, there are generic rewards cards that offer the same amount of rewards on all purchases, which require little planning. But if you want to maximize rewards in common spending categories, such as travel, dining and gas, consider bonus rewards cards that offer over 5% back on purchases and may require activation.
Rewards credit cards typically provide one of three reward structures: cash back, points or miles. The way you earn and redeem rewards varies based on the type of credit card you open.
In addition to the value of cash back, points and miles varying, redemption options also fluctuate. You may be able to redeem for a statement credit, travel, gift card, merchandise or more, depending on the card you have.
In order to make the most of your rewards card, you should familiarize yourself with the benefits and fees. Take note of any annual fees and the APR associated with your account, as well as the rewards rates and added perks, such as annual statement credits.
Once you're familiar with the terms of your card, you can start to take full advantage of them. That may include setting reminders to use the $100 annual airline fee credit provided by the American Express® Gold Card or submitting a Global Entry application with the Capital One® Venture® Rewards Credit Card to receive a $100 credit.
If you have multiple credit cards, consider the rewards offered by each card before deciding which to use. Let's say you have the Citi® Double Cash Card and Chase Sapphire Reserve®. Use the Chase Sapphire Reserve® for all your travel and dining expenses to earn 3X points, then use the Citi® Double Cash Card for everything else to earn an effective 2% cash back.
If you pay for purchases with cash or debit, you're leaving extra money on the table. Using one of the rewards credit cards mentioned above can earn you more than $2,000 in rewards over five years. This is a large amount of money that can help offset the cost of past purchases or fund upcoming expenses.
To determine which credit cards offer the best value, CNBC Select analyzed 111 of the most popular credit cards available in the U.S. that offer rewards programs, from cash back to points and miles. We compared each card on a range of features, including rewards, welcome bonus, introductory and standard APR, balance transfer fees and foreign transaction fees, as well as factors such as required credit score and customer reviews when available. We also considered additional perks, the application process and how easy it is for the consumer to redeem points.
CNBC Select teamed up with location intelligence firm Esri. The company's data development team provided the most up-to-date and comprehensive consumer spending data based on the 2019 Consumer Expenditure Surveys from the Bureau of Labor Statistics. You can read more about their methodology here.
Esri's data team created a sample annual budget of approximately $22,126 in retail spending. The budget includes six main categories: groceries ($5,174), gas ($2,218), dining out ($3,675), travel ($2,244), utilities ($4,862) and general purchases ($3,953). General purchases include items such as housekeeping supplies, clothing, personal care products, prescription drugs and vitamins, and other vehicle expenses.
CNBC Select used this budget to estimate how much the average consumer would save over the course of a year, two years and five years, assuming they would attempt to maximize their rewards potential by earning all welcome bonuses offered and using the card for all applicable purchases. All rewards total estimations are net the annual fee.
It's important to note the value of a point or mile varies from card to card and based on how you redeem them. When we calculated the estimated returns, we assumed that cardholders are redeeming points/miles for a typical maximum value of 1 cent per point or mile. (Extreme optimizers might be able to achieve more value.)
Our final picks are weighted heavily toward the highest five-year returns, since it's generally wise to hold onto a credit card for years. This method also avoids giving an unfair advantage to cards with large welcome bonuses.
While the five-year estimates we've included are derived from a budget similar to the average American's spending, you may earn a higher or lower return depending on your shopping habits.
For rates and fees of the American Express® Gold Card, please click here.
For rates and fees of the Blue Cash Preferred® Card from American Express, please click here.