Best Rewards Credit Cards for October 2020
This article was last updated Oct 01, 2020. Terms and conditions may have changed. For the most accurate information, please consult the issuer website.
Whether you spend a large amount on groceries each month, have a long daily commute to work or travel from time to time, earning credit card rewards on those expenses is a great way to help offset some of those costs.
Rewards credit cards allow you to earn points, miles or cash back on eligible purchases. Depending on the card, you may then be able to redeem those rewards for statement credits, travel, merchandise or other options.
When choosing a rewards credit card, you should first determine what type of purchases you spend the most on and which card can help you get the most value from those purchases. You should also consider the card’s sign-up bonus, annual fee and redemption options for rewards.
In this post, we break down several rewards credit cards to help you determine which one could be the best fit for you based on how you plan to use the card.
In this post:
- Best rewards card for travel – Chase Sapphire Preferred® Card
- Best rewards card for dining and entertainment – Capital One® Savor® Cash Rewards Credit Card
- Best rewards card for supermarket shopping – Blue Cash Preferred® Card from American Express
- Best rewards card for gas purchases – Costco Anywhere Visa® Card by Citi
- Best rewards card or rotating bonus categories – Discover it® Cash Back
- Best rewards card for general purchases – Chase Freedom Unlimited®
- Best rewards credit cards FAQs
- The bottom line
- Cashback rewards reign supreme, but younger consumers strongly value travel points and miles
Comparing the best rewards credit cards
| Rewards card | Introductory bonus/Welcome Offers | Rewards earning rate | Annual fee |
| Chase Sapphire Preferred® Card | Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,000 toward travel when you redeem through Chase Ultimate Rewards®. | 2X points on travel and dining at restaurants, eligible delivery services, takeout and dining out & 1 point per dollar spent on all other purchases worldwide. | $95 |
| Capital One® Savor® Cash Rewards Credit Card | Earn a one-time $300 cash bonus after you spend $3000 on purchases within the first 3 months from account opening | 4% Cash Back on dining; 4% Cash Back on entertainment; 2% Cash Back at grocery stores; 1% Cash Back on all other purchases. Plus, earn 8% cash back on tickets at Vivid Seats through Jan 2022. Also earn 4% cash back on select streaming services through Dec. 31, 2020 | $95 |
| Blue Cash Preferred® Card from American Express | $300 statement credit after you spend $3,000 in purchases on your new Card within the first 6 months. | 6% Cash Back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%). 6% Cash Back on select U.S. streaming subscriptions. 3% Cash Back at U.S. gas stations and on transit (including taxis/rideshare, parking, tolls, trains, buses and more). 1% Cash Back on other purchases. | $0 introductory annual fee for one year, then $95 |
| Costco Anywhere Visa® Card by Citi | N/A | 4% cash back on eligible gas for the first $7,000 per year and then 1% thereafter, 3% on restaurants & travel, 2% at Costco & Costco.com, 1% on all other purchases | $0 (Costco membership required) |
| Discover it® Cash Back | For new cardmembers – Unlimited Cashback Match – only from Discover. Discover will automatically match all the cash back you’ve earned at the end of your first year! There’s no minimum spending or maximum rewards. Just a dollar-for-dollar match. | Earn 5% cash back on everyday purchases at different places each quarter like Amazon.com, grocery stores, restaurants, gas stations and when you pay using PayPal, up to the quarterly maximum when you activate. Plus, earn unlimited 1% cash back on all other purchases – automatically. | $0 |
| Chase Freedom Unlimited® | Earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening. And earn 5% cash back on grocery store purchases (not including Target® or Walmart® purchases) on up to $12,000 spent in the first year. | Earn 5% cash back on travel purchased through Chase, 3% on dining and drugstores, and 1.5% on all other purchases. | $0 |
To see rates & fees for Blue Cash Preferred® Card from American Express please click here.
Best rewards card for travel: Chase Sapphire Preferred® Card
The Chase Sapphire Preferred® Card card offers a lucrative sign-up bonus that can be used to help offset the cost of future travel. Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,000 toward travel when you redeem through Chase Ultimate Rewards®.
The card also offers 2X points on travel and dining at restaurants, eligible delivery services, takeout and dining out & 1 point per dollar spent on all other purchases worldwide.
What else we like. Along with redeeming points for travel, gift cards, cash and more, Chase Sapphire Preferred® Card members can transfer points at a rate of 1:1 to 10 airline partners and three hotel partners. Travel transfer partners include British Airways Executive Club, Emirates Skywards, Flying Blue Air France KLM, JetBlue TrueBlue, Southwest Airlines Rapid Rewards, United MileagePlus, Marriott Bonvoy, World of Hyatt and more.
What to look out for. The Chase Sapphire Preferred® Card card charges an annual fee of $95. The card does not offer a 0% introductory APR on purchases, so it is not ideal if you’re planning to finance a big purchase.
Best rewards card for dining and entertainment: Capital One® Savor® Cash Rewards Credit Card
The Capital One® Savor® Cash Rewards Credit Card is a great option if you regularly dine out or frequently attend concerts and other entertainment events. Cardholders earn unlimited 4% Cash Back on dining; 4% Cash Back on entertainment; 2% Cash Back at grocery stores; 1% Cash Back on all other purchases. Plus, earn 8% cash back on tickets at Vivid Seats through Jan 2022. Additionally, earn 4% cash back on select streaming services, including Netflix, Hulu and Disney+, through Dec. 31, 2020.
Cash back can be redeemed as a statement credit or check, as well as for previous purchases, gift cards and more.
What else we like. The Capital One® Savor® Cash Rewards Credit Card comes with a generous sign-up bonus offer: Earn a one-time $300 cash bonus after you spend $3000 on purchases within the first 3 months from account opening.
What to look out for. The Capital One® Savor® Cash Rewards Credit Card charges an annual fee of $95. That said, you can try out the card without an upfront financial commitment.
Best rewards card for supermarket shopping: Blue Cash Preferred® Card from American Express
This offer and/or promotion may have since changed, expired, or is no longer available.
If you spend a large amount on groceries every month, you’ll come out on top with the Blue Cash Preferred® Card from American Express. The card offers 6% Cash Back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%). 6% Cash Back on select U.S. streaming subscriptions. 3% Cash Back at U.S. gas stations and on transit (including taxis/rideshare, parking, tolls, trains, buses and more). 1% Cash Back on other purchases.
Cash back is earned in the form of Reward Dollars, which can be redeemed as statement credits.
What else we like. With the Blue Cash Preferred® Card from American Express, cardholders earn a welcome bonus of $300 statement credit after you spend $3,000 in purchases on your new card within the first 6 months.
Additionally, the card offers an introductory APR of 0% on purchases for 12 months (then a 13.99%-23.99% variable APR applies).
What to look out for. The Blue Cash Preferred® Card from American Express comes with an annual fee of $0 introductory annual fee for one year, then $95. That said, if you max out the $6,000 spending maximum at U.S. supermarkets in a calendar year, you’ll earn $360 back from those purchases – which more than covers the annual fee.
Best rewards card for gas purchases: Costco Anywhere Visa® Card by Citi
If you spend a decent amount on gas each month and if you regularly shop at Costco, you should take a look at the Costco Anywhere Visa® Card by Citi. The card currently offers one of the highest rewards rates on gas purchases: Cardholders earn 4% cash back on eligible gas for the first $7,000 per year and then 1% thereafter, 3% on restaurants & travel, 2% at Costco & Costco.com, 1% on all other purchases. If you max out the spend cap by spending $7,000 on gas, you’ll earn $280 back on those purchases in a year, minus the price of Costco membership.
Note, the gas category includes eligible gas purchases made worldwide – including those made at Costco. However, gas purchased at superstores, supermarkets, convenience stores and warehouse clubs other than Costco, as well as fuel used for non-automobile purposes, does not qualify for the bonus cashback rate.
What else we like. The Costco Anywhere Visa® Card by Citi comes with a $0 annual fee. However, a Costco membership is required, which runs $60 per year for a Gold Star membership and $120 per year for a Gold Star Executive membership.
What to look out for. Costco Anywhere Visa® Card by Citi cardholders can only redeem rewards for merchandise or cash back at Costco warehouses located in the U.S., including Puerto Rico. Additionally, rewards are only distributed one time per year (after your February billing cycle) and must be redeemed by Dec. 31 of the year in which they are issued.
Best rewards card for bonus categories: Discover it® Cash Back
If you don’t want to be limited to earning rewards in the same two or three bonus categories all year, you may want to consider the Discover it® Cash Back card. Earn 5% cash back on everyday purchases at different places each quarter like Amazon.com, grocery stores, restaurants, gas stations and when you pay using PayPal, up to the quarterly maximum when you activate. Plus, earn unlimited 1% cash back on all other purchases – automatically.
Upon activation, you’ll get 5% cash back on up to $1,500 in combined purchases each quarter (then 1%) in the following categories during 2020:
- January – March 2020: Grocery stores, Walgreens and CVS (Activate now)
- April – June 2020: Gas stations, Uber, Lyft and wholesale clubs (Activate starting Feb. 1)
- July – September 2020: Restaurants and PayPal (Activate starting May 1)
- October – December 2020: Amazon.com, Walmart.com and Target.com (Activate starting Aug. 1)
Cash back can be redeemed for statement credits, gift cards, charitable donations and more.
What else we like. For new card members, Unlimited Cashback Match – only from Discover. Discover will automatically match all the cash back you’ve earned at the end of your first year! There’s no minimum spending or maximum rewards. Just a dollar-for-dollar match.
If you max out the card’s $1,500 spend threshold each quarter, you’ll earn $300 back in one year. Once you factor in Discover’s cashback match offer, that amount jumps to $600 back at the end of your first year.
The $0-annual-fee card also offers an intro APR on purchases of 0% for 14 months (then a 11.99% - 22.99% variable APR applies), and an intro APR on balance transfers of 0% for 14 months (then a 11.99% - 22.99% variable APR applies).
What to look out for. You must activate the bonus categories each quarter in order to earn the bonus cashback rate. Also, keep in mind that Discover will not match your cash back after the first year.
Best rewards card for general purchases: Chase Freedom Unlimited®
If you want to earn rewards on every purchase, but you don’t want the hassle of dealing with rotating categories or spending caps, the Chase Freedom Unlimited® card should be on your radar. The flat-rate card offers the following sign-up bonus: Earn 5% cash back on travel purchased through Chase, 3% on dining and drugstores, and 1.5% on all other purchases.
What else we like. The $0-annual-fee Chase Freedom Unlimited® card offers the following sign-up bonus: Earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening. And earn 5% cash back on grocery store purchases (not including Target® or Walmart® purchases) on up to $12,000 spent in the first year.
What to look out for. While the Chase Freedom Unlimited® card’s straightforward approach to earning rewards may be appealing to some, there are a number of rewards credit cards available that offer considerably higher rewards rates on groceries, gas, travel and more.
Best rewards credit cards FAQs
Before deciding which of these cards is right for you, it’s important to familiarize yourself with the fundamentals of how rewards credit cards work. In addition to reviewing our frequently asked questions below, we recommend that you take a closer look at the terms and conditions for the card’s rewards program from the issuer’s website.
How do rewards credit cards work?
Rewards credit cards offer points, miles or cash back on eligible purchases. Depending on the card, you may be able to redeem those rewards for statement credits, checks, travel, charitable donations, cash back, merchandise, gift cards and more.
How can you earn credit card rewards?
Many rewards credit cards let you earn rewards when you make eligible purchases using your card and/or when you reach the spend threshold required to earn the card’s sign-up or welcome bonus. Rewards cards may also offer annual bonuses each year on your account anniversary, referral bonuses when you refer a friend to the card and the friend is approved, or when you add an authorized user to your credit card account.
Note, you generally cannot earn rewards on cash advances, balance transfers or illegal transactions.
How many credit card rewards points can I earn?
That depends on the card. For example, some cards offer a flat rewards rate on every purchase. Other cards may offer 1 point or mile (or 1% back for cashback cards) per dollar spent on general purchases, and extra points, miles or cash back in bonus spending categories, like gas, dining or airfare.
While you may be limited on the amount of extra rewards you can earn from bonus categories, cards typically allow you to earn unlimited rewards on general purchases.
What can I do with credit card rewards?
In addition to redeeming rewards for statement credits, travel and more, some cards allow you to transfer your rewards to travel partners.
Will your rewards expire?
Again, that depends on the card. For many credit cards, your rewards will never expire as long as your account remains open and in good standing. However, there are cards that expire your rewards if you don’t make a charge on your card or redeem your rewards within a given time period.
The bottom line
If you are in the market for a credit card that offers rewards on the purchases you make, there are certainly plenty of options to choose from. Ultimately, we think the best rewards credit card for you comes down to how you plan to use the card. For example, if you prefer eating in over dining out, the Blue Cash Preferred® Card from American Express, which offers an accelerated cashback rate at U.S. supermarkets, may be your best fit. But if you want to earn rewards to help cover travel purchases, the Chase Sapphire Preferred® Card card offers better value when redeeming points through Chase Ultimate Rewards.
Cashback rewards reign supreme, but younger consumers strongly value travel points and miles
There’s nothing like earning a bonus on a purchase you were going to make anyway, which is probably why nearly 8 in 10 credit cardholders have some type of rewards card. With so many options available — from straight cash to points that can be redeemed for flights, hotel stays and more — CompareCards turned to consumers to get a sense of who opens these types of cards, which rewards cardholders love the most and how preferences vary by age.
Key findings
- 78% of credit cardholders have some type of rewards card. Cashback cards are most common, followed by airline miles.
- The higher your income, the more likely you are to earn points, cash back or miles on spending. For example, 94% of cardholders earning at least $100,000 per year have a rewards card, while just 59% of cardholders making less than $25,000 said the same.
- Cardholders favor cashback rewards, as nearly 3 in 4 (74%) of those with a rewards card said it’s their favorite type. Airline miles came in second at 17%, followed by hotel points at 11%.
- Gen Z — the youngest generation — seem to covet airline miles more than any other generation. Nearly a third (31%) said it’s their favorite type.
- Not all cardholders maximize rewards: 13% of those with a rewards card said despite the ability to earn points, miles or cash, their primary card is not a rewards card.
- Cardholders overwhelmingly would choose $100 cash over $100 worth of airline and/or hotel points. However, it’s worth noting that a significant amount of Gen Zers (18%) would pick the airline points.
Cardholders’ favorite rewards differ by generation
While each age group ultimately favored cashback rewards overall, Gen Z strayed a bit from their older counterparts. Just 55% of those aged 18 to 23 prefer cashback rewards more than any other type — and while that’s still a large number, it’s much less than that of other generations.
However, nearly a third of Gen Z selected airline miles as their most-loved reward type. Older consumers — many of whom have mortgages, children and other significant financial responsibilities — may appreciate the flexibility of cold, hard cash, while some younger cardholders seem to prefer their credit card spending to fund their lust for travel and adventure.
Most use cashback cards as their go-to
Nearly 60% of all cardholders said their most-used credit card allows them to earn cashback rewards, far surpassing all other types of cards.
“It seems like Americans can’t agree on much of anything these days, but cashback credit cards are one exception,” said CompareCards Chief Credit Analyst Matt Schulz. “There’s no question that cash back is the most popular type of credit card reward. It’s been that way for a long time, and it is only likely to get more and more popular in the near future because of how the pandemic is impacting people’s spending.”
How to find the right rewards card
With so many forms of rewards cards available, cardholders face a seemingly endless array of options. Schulz notes that the “right” rewards card will differ from person to person.
“There’s no one-size-fits-all answer when it comes to the best rewards credit card for you,” Schulz said. “The right card for you is the one that best fits your lifestyle and your goals, and those things are different for everyone.”
When deciding which rewards card to apply for, Schulz suggests reflecting on your typical spending behavior and ultimately asking yourself what you hope to gain.
“Do you spend more on travel and dining or on gas and groceries? Do you prefer cash back or points? Do you just want a card that gives you the same rewards on everything you buy? Think through these and other questions and they will steer you to the right card,” he said.
Methodology
CompareCards commissioned Qualtrics to conduct an online survey of 998 credit cardholders, with the sample base proportioned to represent the overall population. The survey was fielded March 9-12, 2020.
We defined generations as the following ages in 2020:
- Gen Z are ages 18-23
- Millennials are ages 24-39
- Gen X are ages 40-54
- Baby boomers are ages 55-74
- Silent generation are ages 75 and older
