When it comes to credit card rewards, cold, hard cash is always popular. And if you are looking for a good cash-back credit card, you have plenty of choices. So the question is – how do you choose the best one?
With a cash-back card, you receive a percentage of cash back with each purchase you make with the card. And you may get a higher percentage of rewards by making purchases in specific spending categories at specific times of the year. The rate of rewards varies from card to card, as do limitations on the amount of rewards you can earn per month and per year. So check the rewards details and rewards limits on each card you are considering and find out the following:
- How easy is it to redeem rewards?
- Can your cash reward be redeemed for a gift card from your favorite retailer?
- Can you get your cash reward sent as a paper check, a deposit to a bank account or simply as a credit to your account?
- Is the price of a cash-back card with a lucrative rate of rewards a hefty annual fee? Some cash-back credit cards come with annual fees and some don’t.
- Does the card offer other perks, like travel insurance and purchase protection?
Also consider the card’s annual percentage rate for new purchases. Carrying a balance and being hit with finance charges month after month can wipe out any rewards that you may earn. So it’s wise to only charge to a cash-back credit card what you can pay in full each month. However, some cash-back cards do come with an attractive 0% introductory rate for a year or more. So if you needed a few months to pay off a large purchase you could earn cash-back rewards and pay no interest charges for several months. Ideally, you then have a plan to pay off that purchase in full before the teaser rate expires.
You also will need excellent credit to qualify for a cash-back credit card with a 0% introductory rate.
With all this in mind, we reviewed the top cash-back credit cards as part of our Best Credit Cards in America series for the overall value they could offer, both in terms of awards and benefits. After much consideration, we’ve picked the top three. Here’s our winner for the Best Cash-Back Credit Card in America.
Winner of Best Cash-Back Credit Card in America: Citi Double Cash
We chose the Citi Double Cash credit card as our winner because of the rewards and features it offers. Cardholders get a total of 2% cash back with no annual fee — earning 1% cash back when they make a purchase, and another 1% when their purchase is paid for. In addition, new applicants receive 15 months of interest-free financing on new purchases as well as balance transfers, with a 3% balance transfer fee. Finally, this card comes with all of the same features and benefits found on Citi cards including several purchase protection and travel insurance policies.
Fees to consider: There is no annual fee for this card, but there is a 3% foreign transaction fee imposed on all charges processed outside of the Untied States.
Applying for a Cash-Back Credit Card
Before you apply for any credit card, carefully do your research and make sure the card’s offerings meet your specific needs. It’s also important to know whether you’ll meet the card issuer’s general credit requirements, which means it’s helpful to know what your credit score is ahead of time. You can see two of your credit scores for free through Credit.com. Finally, in order to fully benefit from cash-back rewards, it’s ideal not to carry a balance on these cards, and instead plan your spending so that you’re able to pay the balance in full every month.
Want to see more? Here are our other picks for the best cash-back credit cards in America.
Note: It’s important to remember that interest rates, fees and terms for credit cards, loans and other financial products frequently change. As a result, rates, fees and terms for credit cards, loans and other financial products cited in these articles may have changed since the date of publication. Please be sure to verify current rates, fees and terms with credit card issuers, banks or other financial institutions directly.
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This article originally appeared on Credit.com.