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If you haven't shopped for new rewards credit cards lately, the start of 2021 is a great time to do it. You can see what some of the top cards are offering, and put together a strategy to earn as much back as possible next year.
Of course, not everyone needs the same things in a rewards card. There are consumers who want a one-card wallet, meaning one rewards card for all their spending. Others are open to multiple credit cards. Some want to earn cash back, and others want points they can use for travel.
Each rewards card on this list comes with a recommendation on what it's best for. That way you can find the cards that fit your needs.
1. Discover it® Cash Back
Best for: A one-card wallet with no annual fee
For the simplest and most affordable option, the Discover it® Cash Back is tough to beat.
There's no annual fee or foreign transaction fees. It earns 5% back on up to $1,500 in combined purchases across rotating bonus categories you activate every quarter. All other purchases get you 1% back.
What makes this card even better is Discover's cash back match. After your first year using the card, Discover doubles all the cash back you earned. That's why the Discover it® Cash Back is perfect for a one-card wallet. The more you spend during the first year, the more bonus rewards you earn.
2. Capital One® Venture® Rewards Credit Card
Best for: A one-card wallet for travel rewards
If you're looking for a single travel card for all your spending, the Capital One® Venture® Rewards Credit Card is a smart choice.
For a $95 annual fee, it earns a flat rate of 2 miles per $1 on every purchase. You can redeem Venture miles at a rate of $0.01 per mile toward travel spending. Capital One also has travel partners where you can transfer miles.
The Capital One® Venture® Rewards Credit Card is another card that rewards you for spending more over the first year. Right now you can earn up to 100,000 miles. You earn 50,000 miles for spending $3,000 on purchases in the first three months with this limited-time offer, plus 50,000 more for spending $20,000 on purchases in the first 12 months.
3. Blue Cash Preferred® Card from American Express
Best for: Cash back rewards on groceries
You'll get the highest cash back rate on grocery spending with the Blue Cash Preferred® Card from American Express.
It offers an industry-leading 6% back on up to $6,000 per year in U.S. supermarket purchases. That's in addition to 6% back on select streaming services, 3% at U.S. gas stations and on transit expenses, and 1% on everything else. American Express charges a $95 annual fee for this card, which is worth paying if you can take advantage of its high rewards rate.
4. Chase Sapphire Preferred® Card
Best for: Getting started with Chase Ultimate Rewards points
Chase Ultimate Rewards points are some of the most useful travel points on the market. That's why Chase won the best credit card rewards program category in The Ascent's 2020 credit card awards. If you're interested in high-value travel redemptions, it helps to have a card that earns Chase points.
The Chase Sapphire Preferred® Card is the perfect Ultimate Rewards starter card. It has a sign-up bonus of 60,000 points for spending $4,000 in three months. Those 60,000 points are worth at least $750 in travel. This card is also affordable, as it only has a $95 annual fee.
Another nice thing about Chase credit cards is that they work well together. If you have multiple Chase rewards cards, you can combine your points. So, you could earn more by getting this card as well as the next one on the list.
5. Chase Freedom Flex℠
Best for: Bonus rewards in multiple spending categories
The Chase Freedom Flex℠ offers a long list of bonuses, especially for a no-annual-fee card. These include:
- A $200 sign-up bonus when you spend $500 on purchases in three months
- 5% back on up to $1,500 in combined quarterly purchases in bonus categories that you activate
- 5% back on up to $12,000 spent at grocery stores in the first year (purchases at Target and Walmart aren't eligible)
- 5% back on travel booked through Chase Ultimate Rewards
- 5% back on Lyft rides through March 2022
- 3% back at restaurants, which also covers takeout and orders through eligible delivery services
- 3% back at drugstores
All non-bonus purchases earn 1% back.
This card provides considerable value on its own. It's also a great addition if you already have a Chase travel card.
Let's say you have the Chase Sapphire Preferred® Card. You could add the Chase Freedom Flex℠ and use it for purchases in its bonus categories. Then, you can transfer those points to your Chase Sapphire Preferred® Card and use them for travel redemptions.
6. Wells Fargo Propel American Express® card
Best for: Bonus points on your pandemic spending
Quite a few rewards cards have added new, pandemic-friendly bonus categories. The Wells Fargo Propel American Express® card didn't need to, because it already earned bonus points in areas where consumers are now spending more.
With this no-annual-fee Wells Fargo card, you'll earn 3 points per $1 on:
- Streaming services
- Eating out and ordering in
- Gas stations, rideshares, and transit
- Flights, hotels, homestays, and car rentals
Everything else gets you 1 point per $1. Points are worth $0.01 each, and this card also has a 20,000-point sign-up bonus for spending $1,000 in the first three months.
There are plenty of cards that can make 2021 more rewarding for you. It's all about finding the ones that work best for your goals this year and your spending habits.
