Best Rewards Credit Cards for January 2020
This article was last updated Dec 30, 2019. 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
Comparing the best rewards credit cards
| Rewards card | Introductory bonus/Welcome Offers | Rewards earning rate | Annual fee |
| Chase Sapphire Preferred® Card | Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. | 2X points on travel and dining at restaurants & 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 May 2020. | $0 intro for first year; $95 after that |
| Blue Cash Preferred® Card from American Express | $250 statement credit after you spend $1,000 in purchases on your new Card within the first 3 months. | 6% cash back at U.S. supermarkets (on up to $6,000 per year, then 1% back), NEW 6% Cash Back on select U.S. streaming subscriptions & 3% Cash Back on transit including taxis/rideshare, parking, tolls, trains, buses and more | $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 – Discover will automatically match all the cash back you earn at the end of your first year.* | 5% cash back at different places each quarter like gas stations, grocery stores, restaurants, Amazon.com and more up to the quarterly maximum, each time you activate, 1% unlimited cash back on all other purchases - automatically. | $0 |
| Chase Freedom Unlimited® | $150 Bonus after you spend $500 on purchases in your first 3 months from account opening. Earn unlimited 1.5% cash back on all purchases. | 1.5% cash back offer. | $0 |
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. Cardholders earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. If you redeem those points for airfare, hotels, car rentals or cruises through Chase Ultimate Rewards®, you’ll get 25% more value – making the sign-up bonus worth $750.
The card also offers 2X points on travel and dining at restaurants & 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 cardholders 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 May 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 $0 intro for first year; $95 after that. 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
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, then 1% back), NEW 6% Cash Back on select U.S. streaming subscriptions & 3% Cash Back on transit including taxis/rideshare, parking, tolls, trains, buses and more.
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 $250 statement credit after you spend $1,000 in purchases on your new card within the first 3 months.
Additionally, the card offers an introductory APR on purchases of 0% for 12 months (then a 14.49%-25.49% variable APR applies), as well as an intro APR on balance transfers of 0% for 12 months (then a 14.49%-25.49% variable APR applies) .
What to look out for. The Blue Cash Preferred® Card from American Express comes with an annual fee of $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. The card offers 5% cash back at different places each quarter like gas stations, grocery stores, restaurants, Amazon.com and more up to the quarterly maximum, each time you activate, 1% unlimited 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, Discover will automatically match all the cash back you earn at the end of your first year.*
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 13.49% - 24.49% variable APR applies), and an intro APR on balance transfers of 0% for 14 months (then a 13.49% - 24.49% 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 comes with a 1.5% cash back offer.
What else we like. The $0-annual-fee Chase Freedom Unlimited® card lets cardholders earn $150 Bonus after you spend $500 on purchases in your first 3 months from account opening. Earn unlimited 1.5% cash back on all purchases.
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.
