MoneyRates has partnered with CardRatings for our coverage of credit card products. MoneyRates and CardRatings may receive a commission from card issuers. Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities.

Best Rewards Credit Cards of June 2020

| Money Rates Columnist
min read

closet-chef-eat-survival

Getting a rewards credit card just makes sense. It's a simple and easy way to earn money on all your purchases. However, you want to choose your rewards cards wisely.

Let's say you spend $500 a month on your card. At 1% cash back, you'll have an extra $60 in your pocket at the end of the year...

  • ... with 1.5% cash back, you'll have $90...
  • ... but if you can get 5% cash back, you'll earn $300 for the year.

That's a big difference in cash back rewards and exactly why it's so important to select your cards carefully:

To maximize earnings, you want to find the best rewards credit card for your spending habits.

Keep reading for a list of cards that are good for general use, gas, groceries or dining. They were selected based on their earning potential, low fees and bonus offers, which can award as much as additional $300 to those who begin using their cards quickly after opening an account.

Best Overall Rewards Credit Card - Wells Fargo Cash Wise Visa® card

Everyone should have a good, all-purpose rewards card in their pocket. These aren't the flashiest cards; they're the workhorses, providing a solid rewards rate on everything you buy. They're good to use whenever you can't get a higher cash back reward from one of your other cards.

Our top choices all have similar cash back rates, and none of them charge an annual fee. Plus, they have additional perks beyond cash back. However, the Wells Fargo Cash Wise Visa® card edges out the competition thanks to its lower ongoing interest rate.

Best Overall Rewards Credit Card Purchase Intro/Period Regular APR Annual Fee Credit Score Needed
Wells Fargo Cash Wise Visa® card Intro APR: 0%
Period: 15 months
13.99%-25.99% variable $0 Excellent, Good
Chase Freedom Unlimited® Intro APR: 0%
Period: 15 months
14.99 - 23.74% variable $0 Excellent, Good
American Express Cash Magnet® Card Intro APR: 0%
Period: 15 months
12.99% - 23.99% variable $0 Good, Excellent

Wells Fargo Cash Wise Visa® card

The Basics: Wells Fargo offers several solid rewards credit cards that seem to fly under the radar.

The Wells Fargo Cash Wise Visa® card is one example. It's a particularly good choice for anyone who likes to use a digital wallet. Purchases made with Apple Pay or Google Pay earn 1.8% cash back for the first 12 months after you open your account. Other purchases net you 1.5% cash back.

>> Among its more unique redemption options, you can redeem your earnings in $20 increments at Wells Fargo ATMs or apply your rewards to the principal of your Wells Fargo mortgage.

Wells Fargo Cash Wise Visa® card

Wells Fargo Cash Wise Visa® card

Rewards Rate: Earn unlimited 1.5% cash rewards on purchases. 1.8% cash rewards on qualified digital wallet purchases, like Apple Pay® or Google Pay™, during the first 12 months from account opening, 1.5% cash back on all other purchases.

Bonus: $150 cash back after spending $500 within 3 months of opening account

Intro APR: It's a 0% Intro APR.

Intro Period: The intro period is 15 months.

Regular APR: 13.99%-25.99% variable

Annual Fee: $0

Credit Needed: Excellent, Good

Chase Freedom Unlimited®

The Basics: With Chase Freedom Unlimited®, you earn unlimited 1.5% cash back on all purchases.You'll also be rewarded with a $150 cash back bonus after spending $500 within three months of account opening.

Don't forget that the card has a 0% intro APR for the first 15 months on purchases and balance transfers.

Cash back can be redeemed in multiple ways, including direct deposit and statement credits. You can also use your rewards for travel and gift cards.

Chase Freedom Unlimited®

Chase Freedom Unlimited®

Rewards Rate: Earn unlimited 1.5% cash back on all purchases.

Bonus: You can get $150 cash back after spending $500 within 3 months of opening your account.

Intro APR: There's a 0% Intro APR on Purchases.

Intro Period: The intro period is 15 months.

Regular APR: 14.99 - 23.74% variable

Annual Fee: $0

Credit Needed: Excellent, Good

American Express Cash Magnet® Card

The Basics: We like the American Express Cash Magnet® Card for the fact that the annual fee is $0 and you can get unlimited 1.5% cash back on your purchases.

While its bonus offer isn't quite as good as the cards listed above, it does come with some other added benefits. For instance, you'll get free two-day shipping through ShopRunner, access to a global assist hotline, and car rental loss and damage insurance.

Cash back can be redeemed for statement credits, gift cards and merchandise.

American Express Cash Magnet® Card

American Express Cash Magnet® Card

Rewards Rate: Receive unlimited 1.5% cash back on your purchases.

Bonus: Get $150 cash back after spending $1,000 within 3 months of opening account.

Intro APR: The intro APR is 0% on purchases.

Intro Period: It's 15 months.

Regular APR: 12.99% - 23.99% variable

Annual Fee: $0

Credit Needed: Good, Excellent

Pro Tip: Although not a formally published policy, Chase is known for having a 5/24 rule. It means the bank typically doesn't approve card applications from those who have opened five or more personal credit cards in the previous 24 months.

So if you're planning to apply for multiple cards, start with the Chase Freedom Unlimited®. That way your other applications don't affect your ability to be approved for the card.


Best Rewards Credit Card for Groceries - Blue Cash Preferred® Card from American Express

Groceries are a major expense for U.S. households. However, you can save money by using a rewards credit card that provides extra cash back for purchases at supermarkets. Further increase your savings by combining your credit card with coupons and store loyalty program discounts.

The clear winner in this category is the Blue Cash Preferred® Card from American Express. No other card offers 6% cash back. However, Chase Freedom is right behind with its 5% cash back offer for the second quarter of 2020.

Be aware, though, that purchases at Walmart and Target do not qualify as supermarket spending for these and other card issuers.

Best Credit Card for Groceries Rewards Groceries Rewards Rate Regular APR Annual Fee Credit Score Needed
Blue Cash Preferred® Card from American Express See rewards rate below 12.99% - 23.99% variable $95 Good, Excellent
Chase Freedom® See rewards rate below 16.49% - 25.24% variable $0 Excellent, Good
Blue Cash Everyday® Card from American Express See rewards rate below 12.99% - 23.99% variable $0 Good, Excellent

Blue Cash Preferred® Card from American Express

The Basics: If you spend at least $150 a month in groceries, you can easily make back the annual fee for the Blue Cash Preferred® Card from American Express. And if you spend $6,000 annually on groceries - which would max out the 6% cash back offered in the category - you'll wind up with an extra $360 in your pocket at the end of the year.

You can also get 6% cash back on streaming services and 3% cash back on transit and gas purchases. Then it's 1% cash back on other purchases

On top of all that, you can get an extra $250 after spending $1,000 within three months of opening an account.

Blue Cash Preferred® Card from American Express

Blue Cash Preferred® Card from American Express

Rewards Rate: 6% at U.S. supermarkets (on up to $6,000 per year in purchases, then 1%) and - 6% Cash Back on select U.S. streaming subscriptions. There's also 3% cash back on transit purchases such as parking and rideshares, 3% at U.S. gas stations and 1% cash back on other purchases.

Bonus: It's $250 cash back after spending $1,000 within 3 months of opening an account.

Intro APR: 0% on purchases

Intro Period: The intro period is 12 months.

Regular APR: 12.99% - 23.99% variable

Annual Fee: $95

Credit Needed: Good, Excellent

Chase Freedom®

The Basics: While you can get 1% cash back on all purchases from Chase Freedom®, where the card really shines is in its bonus categories.

Each quarter it offers extra cash back rewards on certain categories. For the second quarter of 2020, those categories are fitness clubs, gym memberships and grocery stores, not including Walmart and Target. Cardholders can earn 5% cash back on up to $1,500 spending in those categories.

Chase Freedom®

Chase Freedom®

Rewards Rate: Earn 5% cash back on up to $1,500 in combined purchases in bonus categories every 3 months you activate. Enjoy new 5% categories every 3 months. Unlimited 1% cash back on all other purchases.

Bonus: You can get $200 cash back after spending $500 within 3 months of opening your account.

Intro APR: 0% Intro APR on Purchases

Intro Period: It's a 15 months.

Regular APR: 16.49% - 25.24% variable

Annual Fee: $0

Credit Needed: Excellent, Good

Blue Cash Everyday® Card from American Express

The Basics: The Blue Cash Everyday® Card from American Express is another card offering extra cash back for grocery purchases. You'll get 3% cash back on up to $6,000 spent each year at U.S. supermarkets. There is no annual fee, and the card offers perks such as car rental loss and damage insurance and a global assist hotline. If you need another reason to apply, check out the generous welcome bonus currently being offered.

Blue Cash Everyday® Card from American Express

Blue Cash Everyday® Card from American Express

Rewards Rate: Get 3% Cash Back at U.S. supermarkets (on up to $6,000 per year in purchases, then 1%)., 2% Cash Back at U.S. gas stations

Bonus: $150 cash back after spending $500 within 3 months of opening account

Intro APR: 0% on purchases

Intro Period: 15 months

Regular APR: 12.99% - 23.99% variable

Annual Fee: $0

Credit Needed: Good, Excellent

Pro Tip: If you spend more than $500 a month in groceries, you may want to apply for two of the above cards. Then, when you hit the spending limit of one, you can switch to the other card.


Best Credit Card for Gas Rewards - Wells Fargo Propel American Express® card

Gas is another major expense in many households, and so it makes sense to have a card that offers extra rewards in this category.

Some cards offer extra cash back in rotating categories that provide additional rewards for gas purchases during only part of the year. However, we selected the Wells Fargo Propel American Express® card as the best credit card for gas rewards since it has enhanced earnings for fuel purchases year-round.

Best Credit Card for Gas Rewards Gas Rewards Rate Regular APR Annual Fee Credit Score Needed
Wells Fargo Propel American Express® card 3X points on gas stations 13.99%-25.99% variable $0 Excellent, Good
U.S. Bank Cash+™ Visa Signature® Card 2% cash back on gas stations 13.99% - 23.99%* variable $0* Good,Excellent

Wells Fargo Propel American Express® card

The Basics: If you're looking for flexible rewards, the Wells Fargo Propel American Express® card is a good choice.

Rather than earning a cash back percentage, you'll get points for every purchase. Those points can be redeemed for cash, gift cards or travel through the company's Go Far Rewards portal. The 20,000 bonus points it offers to new cardholders have a $200 cash redemption value.

Another perk with this card is cell phone protection coverage, a benefit not offered by many rewards credit cards.

Wells Fargo Propel American Express® card

Wells Fargo Propel American Express® card

Rewards Rate: You can get 3X points on gas stations, transit, dining, travel and popular streaming services; 1X points on other purchases

Bonus: 20,000 bonus points after spending $1,000 within 3 months of opening account

Intro APR: 0% Intro APR

Intro Period: 12 months

Regular APR: 13.99%-25.99% variable

Annual fee: $0

Credit Needed: Excellent, Good

U.S. Bank Cash+™ Visa Signature® Card

The Basics: The U.S. Bank Cash+™ Visa Signature® Card offers a level of flexibility not found with many other cards. Each quarter, you can select two bonus categories out of 12 options and receive 5% cash back on eligible purchases.

Plus, you can select an additional bonus category for 2% cash back. Gas is one of the choices for 2% cash back, and the other options are grocery stores or restaurants.

U.S. Bank Cash+™ Visa Signature® Card

U.S. Bank Cash+™ Visa Signature® Card

Rewards Rate: Receive 5% cash back on up to $2,000 in combined purchases in two cardholder-selected categories; 2% cash back on the cardholder's choice of gas stations, grocery stores or restaurants; and 1% cash back on all other purchases

Bonus: Get $150 after spending $500 within 90 days of opening your account

Intro APR: N/A

Intro Period: N/A

Regular APR: 13.99% - 23.99%* variable

Annual Fee: $0*

Credit Needed: Good,Excellent

Pro Tip: Even if you don't want to change your bonus category, some cards require you to confirm your selection each quarter to continue receiving the higher cash back reward. Check the fine print on any card offering bonus categories to determine how they handle category selections.


Best Business Credit Card for Gas Rewards - Ink Business Cash℠ Credit Card

Business owners have different needs than other consumers. They may require additional cards for employees and often have significant spending in categories such as fuel. Business credit cards are designed with these needs in mind.

While there are a number of good rewards credit cards for businesses, we think the Ink Business Cash℠ Credit Card deserves the top spot for offering 5% cash back on office supplies and communication expenses and 2% cash back on purchases at gas stations.

Best Business Credit Card for Gas Rewards Gas Rewards Rate Regular APR Annual Fee Credit Score Needed
Ink Business Cash℠ Credit Card See rewards rate below 14.74% - 20.74% variable $0 Excellent, Good
American Express Blue Business Cash™ Card See rewards rate below 13.24% - 19.24% variable No annual fee Good, Excellent

Ink Business Cash℠ Credit Card

The Basics: The Ink Business Cash℠ Credit Card offers lucrative rewards in business categories.

For fuel purchases, cardholders can receive 2% cash back on up to $25,000 spent each calendar year. There is no annual fee for the card, and it comes with additional perks such as free employee cards.

Rewards can be redeemed for cash back, gift cards and travel through Chase Ultimate Rewards.

Ink Business Cash℠ Credit Card

Ink Business Cash℠ Credit Card

Rewards Rate: It's a tiered rewards structure: Earn 5% cash back on the first $25,000 spent in combined purchases at office supply stores and on cellular phone, landline, internet and cable TV services each account anniversary year. Earn 2% cash back on the first $25,000 spent in combined purchases at gas stations and restaurants each account anniversary year. Unlimited 1% cash back on all other card purchases with no limit to the amount you can earn.

Bonus: You can get $500 cash back after spending $3,000 within 3 months of opening account

Intro APR: 0% Intro APR on Purchases

Intro Period: 12 months

Regular APR: 14.74% - 20.74% variable

Annual Fee: $0

Credit Needed: Excellent, Good

American Express Blue Business Cash™ Card

The Basics: For simplicity, select the American Express Blue Business Cash™ Card.

It lets you earn 2% cash back on all eligible purchases on up to $50,000 per calendar year, then 1%.

The card gives eligible business owners expanded buying power to spend beyond their credit limit if needed, and there is an intro APR of 0% on purchases for the first 12 months from date of account opening. The major drawback for this card is that it doesn't have a welcome bonus offer.

American Express Blue Business Cash™ Card

American Express Blue Business Cash™ Card

Rewards Rate: Earn 2% cash back on all eligible purchases on up to $50,000 per calendar year, then 1%.

Bonus: None currently

Intro APR: 0% on purchases

Intro Period: 12 months from date of account opening

Regular APR: 13.24% - 19.24% variable

Annual Fee: No annual fee

Credit Needed: Good, Excellent

Pro Tip: If you're self-employed or work in the gig economy, you may be eligible to open a business credit card.


The Key to Understanding How Rewards Cards Work

To make the most of your rewards credit cards you need to understand all the following:

  • The type of card you have
  • Rates and fees charged by the card
  • Earning opportunities and limits
  • Redemption rules

Let's take a closer look at each one…

Types of Rewards Credit Cards

Rewards credit cards typically fall into one of two broad categories:

  • Cash back credit cards

    These cards may offer a flat percentage of cash back for every purchase or have tiers in which some purchases earn a higher level of cash back than others.

    Some cards also have bonus categories that either rotate quarterly or allow cardholders to decide which purchases earn a higher cash back reward.

  • Travel credit cards

    Travel credit cards may be general purpose and earn points or miles for a program such as Chase Ultimate Rewards or American Express Membership Rewards.

    These programs allow cardholders great flexibility in redeeming for travel. Other hotel and airline cards earn rewards for a specific company's loyalty program, such as Hilton Honors or Delta SkyMiles.

Most of the cards on this list are cash back cards. That's because cash back cards typically offer the most flexibility both in earning and redemption. After all, cash can be used for anything. However, if you travel frequently, you may get greater value from a general-purpose, airline or hotel travel card.

Rewards Credit Card Rates and Fees

The rewards you earn with a credit card can be quickly wiped out by the fees you pay. Check for the following before applying:

  • Annual fees
  • Balance transfer fees
  • Foreign transaction fees

You should also check the interest rate. While some cards, such as the Chase Freedom Unlimited®, have introductory 0% APRs, it is more common for rewards credit cards to charge higher interest rates than those found on non-reward cards.

Earning Opportunities and Limits

Next, you need to consider how you can earn rewards with a card and if there are any limits on what you can receive. Cards make it easy to see how much cash back, points or miles you can earn. Limitations can be a little trickier to find.

Scan the fine print for the following restrictions:

  • Caps on how much you can earn
  • Minimum requirements for redemptions
  • Expiration dates for rewards

Rewards Credit Card Redemptions

Finally, you want to make sure you are able to access your rewards in a way that makes sense for you. Some cards only redeem cash back as statement credits, but most offer several of the following options:

  • Statement credit
  • Automatic deposit to bank account
  • Withdrawal from ATM
  • Paper check
  • Gift cards
  • Travel
  • Merchandise
  • Redemption on shopping sites such as Amazon

>> Most cash back cards redeem your rewards on a dollar-for-dollar basis. Points and miles may have a more variable value.


Strategy: The Fastest Route to Rewards

Once you know the ins and outs of how cards are structured, it's time to select your cards and start earning rewards. Use the following steps to quickly maximize your cash back, miles or points.

1. Plan to use more than one card

To earn the most rewards possible, you'll need several credit cards.

Everyone should have a good all-purpose card such as the Chase Freedom Unlimited® or the Wells Fargo Cash Wise Visa® card.

Then look for cards that match your major spending categories. For instance, if you have a business, you might also want the Ink Business Cash℠ Credit Card.

2. Maximize welcome offers

You get the most bang for your buck, so to speak, with welcome offers.

These sign-on bonuses provide hundreds of dollars or tens of thousands of points or miles to new customers. The catch is that you need to spend a certain amount of money within a specified period, often three months.

For instance, the Chase Freedom® gives $150 cash back to cardholders who spend $500 within three months of opening an account. Meanwhile, the Capital One® Spark® Miles for Business will award 50,000 bonus miles to those who spend $4,500 within three months of account opening.

To maximize a welcome offer, be sure you can comfortably meet the spending requirement on a card before applying. If you can't, move on to another card or see if you have any big expenses coming up that could help you meet the requirement in the future.

3. Label each card

An easy way to be sure you're using the best card for each purchase is to label them in advance. Affix a sticker or write on the card to indicate how you plan to use it. For instance, you may write "groceries" on your Blue Cash Preferred® Card from American Express and "gas" on your Wells Fargo Propel American Express® card.

4. Use cards to pay regular bills

Check with your utility providers, trash service, lenders and other billers to see if they accept credit card payments. If so, use your rewards credit cards to pay your bills and then pay off the credit card with money from your bank account.

However, be aware that some companies assess a surcharge for credit card payments. In that case, you'll have to calculate whether the rewards you'll receive outweigh the costs.

5. Have back-up cards for major categories

If you spend a lot in a certain categories, it only makes sense to have a back-up card if there are spending limits.

You're most likely to encounter this with the best cash back cards for groceries. For instance, you get 6% cash back on groceries for the first $6,000 you spend on your Blue Cash Preferred® Card from American Express.

After that, it's best to switch to a card such as the Blue Cash Everyday® Card from American Express so you can earn 3% cash back on the next $6,000 you spend.

6. Don't carry a balance

One of the worst things you can do with a rewards credit card is to carry a balance. Many of these cards have higher APRs, and the interest you'll pay on a balance will quickly negate the rewards you earn.

7. Downgrade unused cards with annual fees

You may find at some point you end up with a card that isn't as valuable or useful as expected. If it has no annual fee, you can simply discontinue using it. However, you don't want to pay an annual fee for a card you aren't using. Still, cancelling that card could have an impact on your credit score by increasing your debt utilization ratio.

A better option may be to call and see if you can downgrade to a card with no annual fee. For example, you might be able to go from a Capital One Savor Rewards Credit Card to the similar SavorOne Card. Some card issuers may also waive your annual fee for a year if you ask.


Credit Score You Need for a Rewards Card

Many rewards credit cards are looking for applicants with credit scores at or above 700. If yours is lower, take some time to improve your credit before applying. This can be done by making timely payments and reducing your debt.


Methodology

Everyone has different priorities and that means your top rewards credit cards may be different than ours. However, we looked for cards that we felt would be most beneficial to the widest assortment of people.

To rank cards, we weighted them based on the following factors and in this order:

  • Percentage of cash back offered
  • Value of welcome bonus
  • Cost of annual fee
  • Other card perks and benefits
0 Comment