As families prepare to send kids back to school, many worry about the high cost of supplies. Two in three parents are feeling stressed by the expense—which is up from 43% in 2019, according to CompareCards’ annual Back-to-School survey—and it’s easy to see why. The National Retail Federation says coronavirus may push…Read more...
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PenFed's cash-back card could be a better option than heavyweights like the Citi Double Cash — with one important caveat
The Power Cash Rewards Visa Signature® Card card isn't as well known as the Citi® Double...The Power Cash Rewards Visa Signature® Card card isn't as well known as the Citi® Double Cash Card, but it's a strong alternative. Both cards earn up to 2% cash back on every purchase, but the PenFed card offers a welcome bonus, while Citi's card does not. The important caveat: To earn 2% back with the Power Cash Rewards Visa Signature® Card, you need an eligible checking account. You may also be able to qualify for the 2% back rate if you've served in the military. See Business Insider's list of the best cash-back cards » Safety concerns due to the coronavirus have led to less travel, and as a result many rewards credit card users have pivoted to earning cash back instead of points or miles. And while there are nearly as many cash-back cards as there are travel rewards cards, very few of them offer 1.5% to 2% cash back on all purchases with no limits. Among those rare cards is the Power Cash Rewards Visa Signature® Card. It's not as well known as the Citi® Double Cash Card and other cards that earn a flat rate of cash back on every purchase, but it has some advantages — if you have an eligible checking account with PenFed or meet the military-service requirements, that is. PenFed is the Pentagon Federal Credit Union, which was originally created to provide financial services to current and former members of the military and other government and defence industry employees. Now, it's the nation's second-largest federal credit union, and there's no military service requirement to join. Reasons to consider the PenFed Power Cash Rewards card It offers up to 2% cash back By default this card offers 1.5% cash back on all purchases, but you can earn 2% when you become a PenFed Honors Advantage member. To qualify, you must also have an eligible checking account with PenFed (some of which have no fees), or be either an active duty military service member, a member of the Reserves or National Guard, or an honorably discharged US military veteran. New cardholders get an intro APR offer and a sign-up bonus PenFed also offers new applicants two special incentives. First, you receive 0% APR promotional financing on balance transfers for the first 12 months of your account, with a 3% fee added to the amount transferred. And you can also earn a $100 statement credit after you spend $1,500 within the first 90 days of account opening. The fees are below-average Otherwise, this card upholds PenFed's reputation of offering its members low interest rates and few fees. Its current standard interest rate is 14.99% to 17.99%, depending on your creditworthiness when you apply. This is a very competitive interest rate for a rewards credit card, and very close to the national average for all credit cards. That said, rewards credit cards are best used by those who avoid interest charges by paying off their monthly statement balances in full. Those who plan to carry a balance should focus on finding a card with the lowest-possible interest rates, which isn't likely to be a rewards card. The APR for cash advances and the penalty APR is 17.99%, which is far below the rates of most other cards. There's no foreign transaction fee for this card, and surprisingly, there's not even a cash advance fee. Competing cards The other cards that offer 2% cash rewards typically have some caveats. For example, the Citi® Double Cash Card offers 1% cash back at the time of purchase, and another 1% cash back when you pay for your charges, for a total of up to 2% cash back. It offers 18 months of 0% APR on balance transfers, then 13.99% - 23.99% (Variable), but unlike the PenFed Power Cash Rewards, it has no welcome bonus offer. The Fidelity® Rewards Visa Signature® Credit Card offers unlimited 2% cash back on all purchases, but the rewards must be deposited into a qualifying Fidelity Investments account. And it has no welcome bonus or introductory financing offer. The Alliant credit union offers the Alliant Cashback Visa® Signature Credit Card which features 2.5% cash back on all purchases. However, you only earn this rate on your first $10,000 spent each billing cycle, and it has a $99 annual fee that's waived the first year. Finally, the PayPal Cashback Mastercard® offers 2% cash back on all purchases with no annual fee, but features no welcome bonus or promotional financing offer. The PenFed Power Cash Rewards Visa Signature® Card isn't the only credit card that can offer you 2% cash back on all purchases. But of the cards that do, it's the only one that does so with no limits and no annual fee while offering you both a welcome bonus and a promotional financing offer. If there's a catch, it's that to earn the full 2% cash back, you may also have to open a no-annual-fee checking account. If that works for you, this could be the right card for earning the most cash back on all purchases while paying the fewest fees. Related Product Module: Related Product Credit CardsRelated Content Module: More Credit Card CoverageJoin the conversation about this story »
This page includes information about the Discover it® Cash Back product, which is currently not available...This page includes information about the Discover it® Cash Back product, which is currently not available on Business Insider and may be out of date. The best no annual fee credit cards of 2020: Best for cash back: Citi® Double Cash Card Best if you have a Chase Sapphire card: Chase Freedom Unlimited® Earns among the highest cash back, if you work for it: Chase Freedom® Best for shopping at US supermarkets: Blue Cash Everyday® Card from American Express Get your first year of cash back matched: Discover it® Cash Back 3x points on travel, dining, and streaming: Wells Fargo Propel American Express® card 1.5% cash back on every purchase: Capital One® Quicksilver® Cash Rewards Credit Card Best for small businesses: Ink Business Cash℠ Credit Card Best for earning Amex points: Amex EveryDay® Credit Card from American Express Best for American, Delta, or United loyalists: Airline cobranded cards Please note: the offers mentioned below are subject to change at any time and some may no longer be available. Many people feel that paying an annual fee for a credit card makes no sense. Why should you pay to spend money? That's not to say that credit cards with annual fees are never worth it — it's possible to get $2,000 in value in your first year with the The Platinum Card® from American Express, for example, but that requires traveling enough to take advantage of its many travel benefits. But if you don't travel much or don't need bells and whistles like annual statement credits, you can probably do just fine with a card that doesn't charge an annual fee. Plenty of cards without an annual fee offer strong rewards, too, so you're not missing out on points and miles. Table of Contents The best no-annual-fee credit cards Citi® Double Cash Card 1. Citi® Double Cash Card The Citi® Double Cash Card earns 2% cash back — 1% when you make a charge, and 1% when you pay it. Since, if you're looking for credit card rewards, you should be paying your balance off in full each month, you can just look at the full 2%. There's one downside, though: The card doesn't have a sign-up bonus. That said, it's one of the best cash-back cards, and it's simple to use because there are no bonus rewards categories to remember. Chase Freedom Unlimited® 2. Chase Freedom Unlimited® The Chase Freedom Unlimited® is one of the best available options for a no-annual-fee card — especially if there's a chance that you'll want to earn more valuable credit card rewards with a premium card later on. That's because while Chase markets the card as "cash back," it actually earns Ultimate Rewards points that you can redeem for cash (1 point = 1 cent). If you decide that you want maximize the value of those points by purchasing travel with a bonus through Chase, or transfer them to frequent flyer partners, you can open a card like the Chase Sapphire Preferred® Card or the Chase Sapphire Reserve®, and pool your points from the two cards. The Chase Freedom Unlimited® earns 1.5% cash back (or 1.5 points per dollar spent), so paired with a Sapphire Reserve, it's a great card to use for purchases that aren't made on travel expenses or dining. The Chase Freedom Unlimited® is a fantastic all-around card. However, to get the most value when it's time to spend your points, you need the Chase Sapphire Reserve® or Chase Sapphire Preferred® Card, too, so you can pool your points. Otherwise, points are only worth 1¢ each no matter how you use them, and they can't be transferred to airline or hotel partners. Chase Chase Freedom® 3. Chase Freedom® The Chase Freedom® works virtually the same way as the Freedom Unlimited, earning cash back in the form of Chase Ultimate Rewards points that you can either combine with another card, or redeem for cash or merchandise. The key difference is how it earns those rewards. Unlike the Chase Freedom Unlimited®— which earns 1.5% cash back (or 1.5 points per dollar spent), the Chase Freedom® earns 5% (or 5x) in rotating categories each quarter on up to $1,500 spent in that category. For example, the current quarter includes purchases at Amazon and Whole Foods. Blue Cash Everyday® Card from American Express 4. Blue Cash Everyday® Card from American Express The Blue Cash Everyday is a cash-back card, earning 3% cash back at US supermarkets on up to $6,000 each year — and 1% after that — 2% back at US gas stations and select department stores, and 1% cash back on everything else. There's also a "Preferred" version of the Blue Cash Everyday — the Blue Cash Preferred® Card from American Express earns a bigger 6% back on the first $6,000 spent at US supermarkets per calendar year (and 1% after), 6% back on select US streaming services, 3% back at US gas stations and on transit including taxis, rideshares, parking, and tolls, and 1% cash back on everything else. The higher earning rate on the Preferred makes it worth paying the annual fee — however, the Blue Cash Everyday is still a great option if you're opposed to that. 5. Discover it® Cash Back The Discover it® Cash Back works similarly to the Chase Freedom®: It offers 5% cash back on up to $1,500 spent each quarter in rotating bonus categories, and 1% cash back on everything else. It doesn't offer the same bonus categories as the Chase Freedom, though. While the Freedom is offering bonus cash back on Amazon and Whole Foods purchases in Q3 of 2020, the Discover it® Cash Back is offering bonus cash back at restaurants and PayPal. The Discover it® Cash Back for one other reason: Discover will match all your cash back after your first cardmember year. So if you earned $500 in cash back in your first year, Discover would match that $500 for a total of $1,000 in cash back. This awesome feature is available on all Discover cards — and all Discover cards have no annual fee. 6. Wells Fargo Propel American Express® card This card from Wells Fargo has one of the more attractive rewards programs you'll find from a no-annual-fee card — at least, if you don't want to dive into the complicated world of multiple rewards programs and complex redemptions. The card earns 3x points on all travel, dining, and select streaming services (and 1x point on everything else). If that sounds familiar, it's because it's almost the same as the popular Chase Sapphire Reserve®, which has a $550 annual fee. The Propel lets you redeem points for 1¢ each toward cash back, merchandise, travel, and more. It doesn't offer much in the way of additional benefits beyond rewards, though it does come with cell phone protection. 7. Quicksilver Cash Rewards Card The Quicksilver card has no annual fee, and earns 1.5% cash back on every purchase you make. In this regard, it's similar to the Chase Freedom Unlimited®, though you can't combine your rewards with other credit cards to redeem them for travel; this is strictly a cash-back card. There are also no foreign transaction fees, and the card's offering a sign-up bonus of $150 after you spend $500 in the first three months from account opening. Ink Business Cash℠ credit card 8. Ink Business Cash℠ Credit Card The Ink Business Cash℠ Credit Card is another solid Chase entry, although this one is a business card — however, anyone with just about any kind of business can qualify, whether you have a brick-and-mortar space with employees, or you're a freelancer, or even someone with a small side gig. Just like with the two Freedom cards, you can pool the "cash" you earn with points from a points-earning card, effectively converting your cash into (potentially) more valuable points. Alternatively, you can reap the rewards in the form of cash instead. Ink Business Cash℠ Credit Card earns 5% cash back (or 5x points) on the first $25,000 in combined purchases at office supply stores and on internet, cable, and phone services each card holder year. It earns 2% back (or 2x points) on the first $25,000 in purchases at gas stations and restaurants each year, and 1% (or 1x point) on everything else with no cap. Amex EveryDay Card 9. Amex EveryDay Card American Express Membership Rewards is Amex's in-house rewards program, and the Amex EveryDay is the best no-fee card that earns them. These points can be redeemed for travel, merchandise, or more. However, the best option is to transfer them to a frequent flyer partner. The EveryDay earns 2x points at US supermarkets (on up to $6,000 of purchases per year, then 1x after that) and at AmexTravel.com, and 1x on everything else. It also offers a 20% bonus on points earned in a billing period when you make 20 or more purchases during that period. Like most Amex cards, features a few travel and purchase protections, as well as access to the Amex Offers program. While most people will be better off with a version of the card that has an annual fee, the Amex EveryDay® Preferred Credit Card, the regular EveryDay is still a strong option — especially since there's no annual fee. 10. A no-annual-fee airline credit card Delta: Delta SkyMiles® Blue American Express Card American Airlines: American Airlines AAdvantage MileUp℠ Card United: United TravelBank Card Most airline credit cards worth having have an annual fee — although many of them will waive it for the first year. Those cards tend to come with useful benefits for people who fly with the airline, like priority boarding or free checked bags. You can learn more about the best overall airline credit cards here. However, if you're interested in earning frequent flyer miles with a particular airline through your spending, but don't care about those perks and want to avoid the fee, you have a couple of options. If you're a Delta flyer, you can go for the Delta SkyMiles® Blue American Express Card, which offers 2 Delta SkyMiles on every dollar spent with Delta and at restaurants worldwide, and 1 mile per dollar on everything else. It also gets you a 20% discount — in the form of a statement credit — on Delta in-flight purchases like food or drinks. American loyalists can consider the American Airlines AAdvantage MileUp℠ Card. This card offers 2x AAdvantage miles on every dollar spent at grocery stores and with American Airlines, and 1 mile per dollar on everything else. United's no-annual-fee card doesn't earn miles, but instead offers cash back, called "TravelBank" cash, that can only be redeemed towards flights. You'll earn 2% TravelBank cash for every dollar spent with United, and 1.5% on other purchases. You'll also get 25% back on in-flight food and drink purchases. Credit cards that just missed the cut There are many other no-annual-fee credit cards that don't appear on this list. Here's an overview of the cards we considered that didn't make the final cut. Capital One® SavorOne® Cash Rewards Credit Card — This card earns 3% cash back on dining and entertainment, 2% back at grocery stores, and 1% back on all other purchases. Those are some solid bonus categories, but the Wells Fargo Propel beat it out for a place on our list. Capital One® VentureOne® Rewards Credit Card — You'll earn 1.25 miles per dollar on every purchase, which is better than the standard rate of 1 point/mile per dollar on credit cards, but not by much. Citi Rewards+(SM) Card — This card is unique in that it rounds up to the nearest 10 points on all your purchases. It also earns 2x points at supermarkets and gas stations (on up to $6,000 per year, then 1 point per dollar). Cards like the Wells Fargo Propel and the Blue Cash Preferred® Card from American Express have the potential to earn you more rewards, but if you already have a Citi credit card and want to boost your Citi points balance, this card is worth a look. Bank of America® Travel Rewards credit card — With this card, you'll earn 1.5 points per dollar on every purchase. That's not a bad return on spending, but this card — and other Bank of America cards — are most rewarding if you're already a Bank of America customer and have enough money in qualifying counts to qualify for the Preferred Rewards program, which gets you bonus credit card rewards. Frequently asked questions Why trust our recommendations? At Personal Finance Insider, our goal is to help readers make the best decisions with their money. To that end, we spend hours comparing and contrasting the features and benefits of top credit cards so you don't have to. We understand that "best" can be subjective, so we also include information on where each credit card excels, and where it may fall short. How did we choose the best no-annual-fee credit cards? We reviewed dozens of no-annual fee credit cards across all categories — cash-back, travel, airline, hotel, and more — and narrowed our focused to cards that offer more than 1 point or mile per dollar on at least one category of purchase. We also looked at welcome bonuses, rewards caps (such as the $1,500 quarterly limit on the Chase Freedom and Discover it® Cash Back), and other fine print. Is it ever worth paying an annual fee for a credit card? Many of the top rewards credit cards have annual fees — ranging from $95 to $550 — and it can be worth paying for one if you'll use all of its benefits. In many cases, cards with annual fees have perks that are tied to travel, and if you rarely hit the road, these may not be the perfect fit. Always do an honest assessment of a card's perks and see how they match up with your lifestyle before applying for a credit card. Related Content Module: More Credit Card Coverage Join the conversation about this story »
The best cash-back credit cards from Citi, Amex, Wells Fargo, and more — with input from 4 top experts
The best cash-back credit cards in 2020: Best overall: Citi® Double Cash Card Best for bonus...The best cash-back credit cards in 2020: Best overall: Citi® Double Cash Card Best for bonus categories: Wells Fargo Propel American Express® card Best for intro APR offer: Chase Freedom Unlimited® Best for cash back on dining: Capital One® Savor® Cash Rewards Credit Card Best for families: Blue Cash Preferred® Card from American Express Highest cash back — if you work for it: Chase Freedom® Best for lower credit scores: Discover it® Secured Want an in-depth answer? Check out our cash-back credit card guide below. Travel rewards credit cards can be incredibly lucrative — you can use them to earn enough points to book a first-class flight or a luxury hotel stay. But not everyone wants to travel, and there are a lot of hoops to jump through if you want to maximize your rewards to get the best travel redemptions. That's why there's a great case to be made for cash-back credit cards. Even if the 3 points per dollar you earn from the Chase Sapphire Reserve® can score a higher redemption value, cash is simpler, more flexible, and offers real, immediate value, rather than the perceived value you can get redeeming points for a flight you'd never, ever actually pay for with money. With cash-back cards, 1% back will always be 1 cent back, no matter what. Best of all, many cash-back credit cards don't charge annual fees, so they can be a great way to put money back in your wallet while minimizing your out-of-pocket expenses. The experts on cash-back credit cards We consulted top credit card, travel, and financial experts to weigh in on this list of the top credit cards for earning cash back and to provide their tips for finding the best cash-back card for you. You'll find the full transcript of our expert interviews at the bottom of this article. Best overall: Citi® Double Cash Card Welcome bonus: None Cash back: 2% cash back on every purchase — 1% when you make the purchase, and 1% when you pay your bill Annual fee: $0 In terms of spending rewards, the Citi® Double Cash Card is the best single cash-back card, with 1% back as spend, and 1% back as you pay your bill. Since you should be paying your bill in full each month, you should earn 2% back on purchases each billing cycle. However, there are a few potential downsides. First, there's no sign-up bonus. Second, while it offers a 0% introductory APR for 18 months, that's only on balance transfers, not purchases, so you can't use it to fund a major expense without interest. After those 18 months, it's a variable 13.99% - 23.99% APR. Note that the Citi® Double Cash Card has a minimum redemption amount of $25, and if you don't have any account activity for 12 months, unredeemed rewards can expire. Still, 2% across the board is a good earning rate, and the $0 annual fee is attractive, if not uncommon. Whether that's worth passing on a sign-up bonus is up to you. What the experts love: "Getting 2% cash back is a strong rate, and there are no bonus spending categories to keep track of, so it's perfect for those who love simplicity," says Sarah Silbert, credit cards editor at Personal Finance Insider. What the experts don't love: Other cards offer more cash back, but usually only for specific spending categories. Rathner also points out that the Citi® Double Cash Card doesn't offer a sign-up bonus, while most other cash-back cards do. Citi Citi® Double Cash Card Best for bonus categories: Wells Fargo Propel American Express® card Welcome bonus: 20,000 Go Far points, worth $200, after you spend $1,000 in the first three months of account opening Cash back: 3x points (essentially 3% cash back) on all travel, dining, and select streaming services (and 1x point on everything else) Annual fee: $0 This card from Wells Fargo has one of the more attractive rewards programs you'll find from a no-annual-fee card. While it's marketed as earning "points," those points are worth 1¢ each and can be redeemed for cash, essentially making it a cash-back card. The $200 welcome bonus, combined with the high 3% earning rate on popular spend categories including all dining and travel (and 1% on everything else), as well as the $0 annual fee, makes this a stellar option for a cash-back card. If you're solely interested in earning cash back, not travel rewards, this card would make a good go-to. What the experts love: Sara Rathner, a travel and credit card expert at NerdWallet, notes that the Wells Fargo Propel has high earning rates, especially for a no-annual-fee card. What the experts don't love: "This card lacks the benefits of other travel cards with an annual fee, like reimbursement for Global Entry or the ability to transfer points to airline or hotel partners," Rathner points out. Best for 0% intro APR: Chase Freedom Unlimited® Welcome bonus: $150 (15,000 points) after you spend $500 on purchases in the first three months of account opening Cash back: 1.5% back on all purchases Annual fee: $0 The card has no annual fee and often has 0% APR for the first 15 months on purchases and balance transfers. After that, there's a 14.99%–23.74% variable APR. If you have a major purchase ahead of you, that introductory offer can be useful. While Chase markets the Chase Freedom Unlimited® as "cash back," it actually earns Ultimate Rewards points that you can redeem for cash (1 point = 1 cent). That means that if you also have a premium card like the Chase Sapphire Reserve®, you can pool your points from the two cards. Then, you'll be able to transfer the whole body of points to partnering frequent flyer programs or use them to book travel through Chase with a bonus. What the experts love: The ability to convert your cash back into Ultimate Rewards points if you have another Chase card What the experts don't love: If you don't pair this card with another Chase card, you'd do better with another cash-back card that earns more than 1.5% back. Chase Chase Freedom Unlimited® Best for cash back on dining: Capital One Savor Cash Rewards Credit Card Welcome bonus: $300 after you spend $3,000 in the first three months of account opening Cash back: Unlimited 4% cash back on all dining and entertainment, 2% back at grocery stores, and 1% on everything else. Annual fee: $95 If dining and cooking are your thing, the Capital One Savor is the winner. The Savor makes it easy to earn cash back quickly, but the downside is that it has a $95 annual fee —at least it's waived the first year. The earning rate may make up for the fee in some cases, though. What the experts love: Rathner and Silbert both applaud the card's strong earning rate for dining and entertainment, as well as the relatively generous sign-up bonus for a cash-back card. What the experts don't love: Silbert notes that unlike many cash-back cards, the Savor has an annual fee, while Rathner points out that the 2% cash-back rate for groceries isn't the best for this category of spending. Click here to learn more about the Capital One Savor card » Best for families: Blue Cash Preferred® Card from American Express Welcome bonus: $250 statement credit after you spend $1,000 in the first three months of account opening Cash back: 6% cash back at US supermarkets on up to $6,000 in purchases per year (and 1% after that), 6% cash back on select US streaming services and 3% back on all transit, 3% back at US gas stations, and 1% cash back on everything else. Annual fee: $95 If you're looking for an American Express cash-back card, the Blue Cash Preferred® Card from American Express is the best option. The Blue Cash Preferred® Card from American Express offers a 0% intro APR on purchases and balance transfers for the first 12 months, before switching to a variable 12.99%-23.99% APR. The Blue Cash Preferred® Card from American Express comes with a handful of travel and purchase protections as well. Cash back comes in the form of a statement credit, so effectively you can use it to "erase" purchases. What the experts love: "6% cash back at supermarkets is the highest rewards rate around for grocery spending," says Rathner. "I also love that you get 3% cash back on not just gas, but also public transit. You can get rewarded for all the ways you commute to work!" What the experts don't love: "There's a $6,000 annual spending cap on getting 6% cash back on groceries — you'll only earn 1% cash back after that. Any household with high grocery bills might want to keep that in mind and switch to another card that earns more than 1% after hitting that threshold," Rathner says. American Express Blue Cash Preferred® Card from American Express Highest cash back, if you work for it: Chase Freedom® Welcome bonus: $200 cash back (15,000 points) after you spend $500 in the first three months of account opening Cash back: 5% cash back each quarter you activate on a few different categories that change quarterly, on the first $1,500 of purchases. The card earns 1% on all other purchases, and on those bonus categories after you pass $1,500. Annual fee: $0 The Chase Freedom® is the older sibling of the Chase Freedom Unlimited®, and is essentially the same exact card except for how it earns cash back. Sometimes there's just one major category per quarter, while other times there can be a few different ones. Past categories have included gas stations, local commuter transportation, department stores, grocery stores, drug stores, restaurants, movie theaters, and event Amazon. This quarter, Q2 2020, the Chase Freedom®'s 5% categories are grocery stores and fitness clubs. The usefulness of the categories varies each quarter, with some being better than others. If I had to choose one, I'd stick with the Chase Freedom Unlimited®. However, there's no denying the potential value of the bonus categories, and fortunately, Chase lets you hold both cards. Like the Chase Freedom Unlimited®, the regular Chase Freedom®has no annual fee, offers a 0% introductory APR on purchases for the first 15 months (and a 14.99%–23.74% variable APR after), and cash back can be combined with points earned from other Chase cards. What the experts love: "You can earn the equivalent of 5 points per dollar on the rotating quarterly bonus categories if you also have a card that earns Chase Ultimate Rewards points," says Silbert. What the experts don't love: Rathner notes that "there's a $1,500 spending cap on earning 5% back, and after that you'll only earn 1%." Chase Chase Freedom® Best for lower credit scores: Discover it® Secured Welcome bonus: None Cash back: 2% back at gas stations and restaurants on up to $1,000 each quarter, 1% back on everything else Annual fee: See Terms If you have a lower credit score or a limited credit history, you may not be approved for some of the cash-back credit card options outlined above. In that case, the Discover it Secured could make the most sense. Since it's a secured credit card (meaning you put down money as a refundable deposit to "secure" your account), it's easier to get approved for this card. Plus, even though it's a secured card, you can earn bonus cash back at gas stations and restaurants on up to $1,000 each quarter — and Discover will match all the cash back you've earned at the end of your first year. What the experts love: There's no annual fee (beyond your initial security deposit). Also, as Rathner notes, Discover reports your activity to the three major credit bureaus, and you can earn cash-back rewards. What the experts don't love: "There are two potential barriers for consumers seeking a secured card: a $200 minimum deposit and the requirement to fund that deposit from a bank account," Rathner says. And if you can get approved for a non-secured card, you could get more cash back with another option. Frequently asked questions How did we choose the best cash-back credit cards? We narrowed down the dozens of cash-back credit cards currently available to new applicants by looking at a few factors: Ease of use — Are there any hoops to jump through, like needing to be a member of a specific bank? Cash-back earning potential — How much cash back can you earn with this card, and how broad are the bonus categories? Annual fee — Many cash-back cards waive an annual fee, but for the few that do charge a fee, is it justified based on the card's rewards? Options for various types of consumers — We wanted our top cash-back card picks to reflect different types of users, from families looking to maximize grocery spending to those looking to rebuild their credit score. What are the different types of cash-back cards? Flat rate — These cards earn the same rate of cash back on all purchases. For example, the Chase Freedom Unlimited® earns 1.5% back on all spending. Select bonus categories — Many other cash-back cards offer bonus cash back (more than 1%) on select spending categories. For example, with the Capital One Savor card, you'll earn 4% back on dining and entertainment, and 2% back at grocery stores. Rotating categories — A few cards, including the Chase Freedom®, offer bonus cash back on a selection of spending categories that changes every quarter of the year. These cards have a cap on how much bonus cash back you can earn each quarter — with the Freedom, you'll earn 5% back on up to $1,500 in combined purchases each quarter. All purchases above that cap will earn just 1% back. Some cards are starting to offer yet a fourth format for delivering cash-back rewards: pick your own bonus categories from a list of options. These cards include the Bank of America Cash Rewards credit card and the U.S. Bank Cash+ Visa Signature Card. What credit card offers the most cash back? If you don't want to overthink it, the Wells Fargo Propel American Express® card is a good go-to. It offers 3% back on a wide variety of categories, including travel and eating out. That's not to say you couldn't earn more cash back with another card, though. The Blue Cash Preferred® Card from American Express earns 6% back on the first $6,000 you spend each year at US supermarkets (then 1% back), and 6% back on select US streaming services, for example, and the Capital One Savor is the most rewarding pick for dining out with 4% back. How does earning cash back work? Cash-back credit cards earn you a percentage of cash back — usually at least 1%— on every dollar you spend (or more with cards that have bonus cash-back categories). You can transfer the cash back you earn from these cards to a bank account or use them to wipe charges from your credit card statement. Credit card issuers also allow you to redeem the cash back you earn for gift cards and merchandise. If you're trying to put money back in your wallet, our top recommendations are to transfer your cash back to a banking account or use it to reduce the amount owed on your credit card statement. Do cash-back cards actually give you cash? Cash-back credit cards do give cash, but that's not to say you'll necessarily see the physical cash. You're typically awarded cash back as a credit that you can use to cancel out purchases from your credit card statement, or to redeem for gift cards or merchandise online. Should I earn cash back or points? It depends on what you want to do with your rewards. If you want to put money back in your bank account, a cash-back credit card will help you accomplish just that — and you usually won't have to pay a very high annual fee, if you have to pay one at all. On the other hand, if you're hoping to earn rewards that you can redeem for travel, a card that earns points is more up your alley. Our picks for best points-earning rewards cards earn either Amex Membership Rewards points, Chase Ultimate Rewards points, or Capital One miles. You can transfer all three of these currencies to travel partners and redeem them for things like free flights. (Note that while Capital One calls its rewards currency "miles," they aren't miles with a given airline program.) If you're willing to juggle multiple credit card accounts, there's value in having both cash-back and points-earning cards. If you prefer a single-card strategy, evaluate your goals and consider how much you're willing to pay in annual fees to make the best decision for your situation. The experts' advice on choosing the best cash-back card for you We asked credit card and travel experts, along with a certified financial planner, for their best advice on choosing a good cash-back credit card. Generally, what features make a cash-back card good? Sara Rathner, travel and credit cards expert at NerdWallet: Much like travel cards, you want to find a cash-back card that rewards you more where you spend the most. Redemptions should be easy, too. Most cash-back cards grant you a statement credit, but some will mail a check or deposit your cash back into your bank account. Luis Rosa, certified financial planner: Cards that offer an additional category in addition to the standard categories like gas, groceries or restaurants are very appealing. If you're loyal to a specific brand for example and use it often, a cash-back that offers additional cash back at that specific brand is a good option. Summer Hull, director of travel at The Points Guy: More cash is better than less cash. Look for those cards that award the most back in the categories you spend money in most frequently. 2% back is the standard these days, but aim for more in categories that are important to you. Sarah Silbert, credit cards editor at Personal Finance Insider: A good cash-back card is one with generous bonus categories, since the goal is to earn as much cash back as possible on your spending. The more bonus categories, the better, and the higher the cash-back rate, the better. How can someone identify whether a cash-back card is good for them? Sara Rathner, NerdWallet: If you want ultimate flexibility when it comes to your credit card rewards, it's hard to beat cold, hard cash. That makes cash-back cards a solid option for consumers who simply want to save money on every purchase, rather than rack up rewards to eventually use on travel. Think of using a cash-back card as using a coupon every time you shop. Luis Rosa, CFP: If you spend a lot in general categories such as groceries, restaurants, and gas, having a cash-back credit card might be beneficial to you. In addition, If you are loyal to a specific brand and the credit offers a higher cash back percentage for shopping with that particular brand, then this provides an even greater incentive to consider a cash-back card. Summer Hull, The Points Guy: Cash is never a bad thing, but if you like to travel, then sometimes travel rewards can be more valuable, but just be realistic with your goals and go with what seems like the best idea at the time. You can always change your mind later. Sarah Silbert, Personal Finance Insider: If you don't want to spend time learning how to maximize travel rewards and transferring your points to travel partners, a cash-back card could be a great option. It allows you to maximize your spending with minimal work, since you don't have to jump through lots of hoops with cash back; you simply use the card and you'll get money back in your account. What should someone consider when selecting a cash-back card? Sara Rathner, NerdWallet: If travel cards aren't of interest to you and you qualify for a rewards card, then you should at least be using a flat-rate cash-back card that earns the same rewards rate on every purchase. If you stick to that no-frills card without rewards, you're literally leaving money on the table. Luis Rosa, CFP: You should really understand how to redeem you cash back. Get familiar with the features. For example, can you apply the cash back toward your balance? Can you use the cash for anything or only in certain predetermined places? Is the cash back a flat rate, is it tiered? Another thing to consider is whether or not you carry a balance. If you do carry a balance, you should also consider the interest that you'll be paying on that balance in order to ensure that you're not paying more in interest than the cash back you're receiving. Summer Hull, The Points Guy: Annual fee, earn rate, whether there are any bonus categories, and how easy is it to cash out your earnings. Sarah Silbert, Personal Finance Insider: Take a look at a card's bonus categories. You'll want to pick a card that earns you more than 1% cash back on the categories where you spend the most, such as dining, groceries, and travel. Or if you don't spend a lot in a specific category, look for a card that offers 1.5% cash back or more on every purchase. And make sure you do your research so you don't miss out on a higher sign-up bonus. If the card has an annual fee, decide whether you will use it enough for it to be worth it. 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