Credit card rewards are all the rage these days. Whether you choose to use them or not, there’s no denying that they’re a great way to earn some extra cash. However, they can be tricky, and using your credit card strategically is a challenge. How can you take advantage of your card’s rewards and other perks without getting in over your head?
A credit card can help you reach your savings goals. But which credit card is right for you? How do you find the best card?
What Are Credit Cards?
Credit cards, or credit accounts, are revolving credit accounts that charge consumers a monthly fee for the privilege of borrowing from the credit card issuer. Credit cards allow consumers to borrow up to a certain limit, which varies depending on the credit card issuer. The charges on the card are broken down into three different categories: interest, finance charges, and fees. Interest and finance charges are charged on a daily basis. Interest is charged from the moment the card is borrowed until the balance is paid in full. Finance charges are calculated daily and are added to the balance due on a daily basis. Fees, however, are typically charged on each transaction. Fees may include purchase protection, cash advance, late payment, over-limit, and balance transfer.
The 6 Credit Cards and their Best Rewards and Points
- Capital One Venture Rewards Credit Card – The Venture Rewards Credit Card from Capital One has one of the most generous rewards programs around. Capital One is well-known for offering a variety of helpful tools, including their no-annual-fee Venture Rewards Credit Card. This card provides 2 miles for every dollar spent, and cardholders don’t have to redeem their miles for cash or redeem them at all.
- Chase Freedom Unlimited – Chase Freedom Unlimited is a no-fee credit card that gives you 1.5% cashback on all purchases, with no caps. (This card also has no annual fee and no foreign transaction fees.) It’s one of our favourite rewards credit cards — and it’s especially good if you use it to pay your monthly recurring bills. This card has no annual fee, so it’s an easy way to save money on interest.
- Citi® Double Cash Card – The Citi Double Cash Card is one of the most popular rewards cards on the market. It offers cardholders 1.5% cashback on their purchases in select categories each quarter, and 1% cashback on all purchases, with no annual fee. The Citi Double Cash Card also comes with 10% back on eligible Citi cards and 2% cash back on eligible purchases made at gas stations, drugstores, and supermarkets—which adds up to more than $300 in cashback a year for the cardholder.
- Chase Sapphire Preferred® Card – For maximum rewards and points, the Chase Sapphire Preferred® Card is the best credit card for cashback and points. This credit card is easy to understand and easy to use, plus it earns 2.5% cashback on all purchases, plus an additional 1% cashback on dining and travel.
- Citi Custom Cash℠ Card – The Citi Custom Cash SM Card allows you to earn 2% cashback for all purchases, with no annual fee. This is on top of the 1% cashback on all purchases that you receive with your Citi card. This rewards card is designed for those who pay their bills on time and want to build their credit.
- U.S. Bank Cash+™ Visa Signature® Card – U.S. Bank’s Cash+TM Visa Signature® Card offers 2 cash back on every purchase and a quarterly bonus of 2% cashback (up to $500 in rewards per quarter). Not only that, but the Cash+TM Visa Signature® Card rewards are redeemable on purchases of more than $1,000, so you’ll get big rewards on big purchases.
How To Redeem Cashback Rewards and Points to our Credit Cards
Are you able to save money with credit cards? Probably. But have you ever thought about how cash back rewards or points can be used as cash? (That’s right—cash.) The catch is that banks don’t always make it easy to redeem cashback rewards or points. Most banks offer two ways to redeem rewards: as statement credit (the refund is credited to your account) or as cash (the refund is deposited into your checking account). However, the cashback rewards are usually less than the statement credit, and cash usually doesn’t earn you as many rewards as a statement credit.
Reward cards are great, but by themselves, they don’t do much for you. You need a way to redeem your rewards for something worthwhile. Luckily, Capital One offers many ways to redeem your rewards. If you have a bank account, you can redeem your cashback by paying bills, transferring money, or shopping with their co-branded credit card. If you don’t have an account with them, you can redeem your rewards by writing a check, using a debit card, or transferring to a bank account.
If you want to have a better financial future, be sure to find the credit cards that offer the best rewards or points. You won’t regret it.