Best Credit Cards for Rewards for January 2021

Credit Card	Best For	Rewards Rate	Annual Fee
Chase Sapphire Reserve®	Best Overall, Best for Travel	Earn 3x points on travel immediately after earning your $300 travel credit, 3X points on dining at restaurants, and 1 point per $1 spent on all other purchases.	$550
Capital One Venture Rewards Credit Card	Best for Travel Rewards	Earn 2 miles per dollar on every purchase. Redeem on travel-from vacation rentals to car rentals and more. Plus transfer your miles to over 10+ travel loyalty programs.	$95
United℠ Explorer Card	Best for Airlines	Earn 2 miles per $1 spent at restaurants, on hotel stays, and on United purchases. 1 mile per $1 spent on all other purchases. Enjoy priority boarding privileges and visit the United ClubSM with 2 one-time passes each year for your anniversary.	$95
Capital One Quicksilver Cash Rewards Credit Card	Best for Cash Back, Best No Annual Fee	1.5% cash back on every purchase, every day.	$0
Wells Fargo Propel American Express® Card	Best for Bonus Points	Earn 3X points for eating out and ordering in, gas stations, rideshares, transit, for travel including flights, hotels, homestays and car rentals, as well as popular streaming services. Earn 1X points on other purchases.	$0
Hilton Honors American Express Card	Best for Hotels	7 points per $1 for eligible Hilton purchases. 5 points per $1 for eligible purchases at U.S. restaurants, U.S. supermarkets, and U.S. gas stations. 3 points per $1 for all other eligible purchases.	$0
Capital One Spark Miles for Business	Best Business Rewards	Unlimited 2X miles per dollar on every purchase, every day.	$95
Capital One VentureOne Rewards Credit Card	Best No Annual Fee Travel Rewards	Earn 1.25 miles per dollar on every purchase.	$0
U.S. Bank Altitude® Go Visa Signature® Card	Best for Points Earning	Earn 4x points on takeout, food delivery and dining, earn 2x points at grocery stores, grocery delivery, streaming services and gas stations. Earn 1 point per dollar on all other purchases.	$0
Capital One SavorOne Cash Rewards Credit Card	Best for Dining Rewards	Earn 3% cash back on dining, 3% on entertainment, 2% at grocery stores, and 1% on all other purchases.	$0

Pros & Cons of Our Picks for Best Secured Credit Cards

Chase Sapphire Reserve

Best Overall

Offers an excellent introductory bonus for the first months of use. Users have the option to us points for travel or dining with premier travel options when purchasing through Chase Ultimate Rewards.

Pros

• Excellent points rewards rate for travel and dining

• Large bonus for new cardholders

• Premium travel features

• Points are worth 50% more for travel bought through Chase Ultimate Rewards

Read the Full Chase Sapphire Reserve Credit Card Review

Capital One Venture Rewards Credit Card 

Best for Travel Rewards

A comprehensive travel rewards cards that offers two miles for every dollar spent on the card. Rewards can be used across 10 popular travel loyalty programs for convenience.

Read the Full Capital One Venture Card Review

United Explorer Card

Best for Airlines

The highest value per mile earned compared to other airline credit cards with the option to use partner airlines where United is not a good option. Users get special travel benefits and protections when flying United.

Read the Full United Explorer Card Review

Capital One Quicksilver Cash Rewards Credit Card

Best for Cash Back

This cash back rewards card is a triple threat for low interest, waived fees, and high cash back rewards. Users will additionally like the no penalty APR providing more flexibility with payment options.

Read the Full Capital One Quicksilver Credit Card Review

Wells Fargo Propel American Express Card

Best for Bonus Points

Earn three times the points across the most popular spending categories that include dining, gas, and rideshares. Offers cell phone protection and has no annual fee.

Read the Full Wells Fargo Propel Card Review

Hilton Honors American Express Card

Best for Hotels

Earn seven points per dollar spent at Hilton properties. Additionally, earn points towards Hilton stays with purchases in dining, gas, groceries, and more. We like the practicality of the Hilton footprint making redemption at a desired location simple and convenient.

Read the Full Hilton Honors Card Review

Capital One Spark Miles for Business

Best for Business

No spending category is required to earn two times the miles on every purchase. There is no annual fee for the first year and eligibility is lenient for every business, new and established.

Read the Full Capital One Spark Miles for Business Review

Capital One VentureOne Rewards Credit Card 

Best No Annual Fee Travel Rewards Card

A versatile rewards card boasting 1.25 miles for every dollar spent with no annual fee to worry about. Cardholders have the opportunity to redeem miles in any of 10 loyalty programs. 

Read the Full Capital One VentureOne Rewards Card Review

U.S. Bank Altitude® Go Visa Signature® Card 

Best for Points Earning

Maximize points earned for travel with four times the points for takeout and dining, two times the points for grocery, gas, and streaming services, and one point for all other purchases. On top of great rewards, this card boasts no annual fee. 

Read the Full U.S. Bank Altitude Go Card Review

Capital One SavorOne Cash Rewards Credit Card

Best for Dining Rewards 

Excellent dining rewards with 3% on dining and entertainment, 2% on grocery purchases, and 1% on all other purchases. Enjoy a 0% APR on all new purchases for the first 15 months. 

Read the Full Capital One SavorOne Cash Back Credit Card Review

Frequently Asked Questions

How Do Rewards Credit Cards Work?

Rewards credit cards provide cash back, points, or miles for each dollar of spending. There’s typically a base rate that applies to all purchases, sometimes supplemented by higher bonus rewards for certain spending categories. Rewards are customarily redeemed for travel expenses, cash back, gift cards or merchandise through the credit card issuer’s online rewards portal. Total earned rewards can be viewed on your credit card billing statement or on the card issuer’s website when you log into your account. Rewards credit card programs vary widely. Overall, though, they share these positive and negative aspects:

Is a Rewards Credit Card a Good Fit?

A rewards card that provides points or miles can be lucrative, often more so than the other major variety of rewards card – those that provide rewards as plain cash-back. That said, a rewards credit card isn’t for everyone. Using a rewards card effectively requires taking the time to grasp rewards structures that can be more complex than simple flat cash back rates.

Additionally, many rewards cards also carry annual fees that can be substantial. Several of our rewards-card picks above carry fees, even if they don’t start until after the first year. So, if you don’t spend a lot each month using a credit card, it may be better for you to get a card with no annual fee, though that also usually means you won’t earn as much in rewards.

What are the Types of Rewards Cards?

• Fixed-Rate Rewards. With cards like the Capital One Quicksilver Credit Card, cardholders get significant, straight-forward rewards for each dollar spent, no matter the spending category. These rewards may come in the form of points, miles, or cash back.
• Tiered Rewards. Rewards for tiered cards also come in the form of miles, points, or cash back, but vary by spending category. Wells Fargo Propel Card users, for example, earn 3X rewards for dining, takeout, gas station purchases, rideshares, transit, travel (including flights, hotels, homestays and car rentals), and some streaming services. Cardholders earn 1X points on other purchases.
• Business. In addition to consumer-focused cards, there are also many rewards credit cards designed specifically to reward business spending. The Capital One Spark Miles for Business, for example, offers lenient qualification requirements for new businesses and rewards programs designed to help business owners finance the cost of business travel.

What Should You Consider to Find the Best Rewards Credit Card?

Knowing a points card will meet your needs, you now face the task to select one that best meets them. Here are some questions to help you navigate the selection process:

How much are you spending, and on what?

Since rewards among points cards vary by category, it’s important to know as precisely as possible the amounts you typically spend in which categories every month. Budgeting/tracking tools such as Mint can help with this task, since they automatically assign expenses to such spending categories as groceries, dining, and gasoline.

What might you earn from credit card rewards?

Armed with your spending record, you’re ready to assess how much you might earn each month or year on the cards you’re considering. That requires doing the math.

For example, let’s say you spend an average of $2,200 per month on your Chase Sapphire Reserve® card. Let’s assume that $800 of that spending is for travel and dining expenses. Each month, you would earn about 3,800 rewards points.

800 dining & travel x 3 + 1,400 for all other purchases = 3,800

And, in your first year, you would qualify for 50,000 bonus points, bringing your total points to 95,600 accumulated over your first 12 months.

3,800 points x 12 months + 50,000 bonus points = 95,600 points

If you redeem these points through Chase, each point is equal to 1.5 cents in travel rewards, or $1,434 (95,600 points x $0.015).

Plus, on your card anniversary you’ll qualify for an extra $300 travel credit.

That brings your total first-year rewards—on money you were going to spend anyway—to $1,734, less the card’s $550 annual fee, or $1,184.

How much work are you prepared to do, for how much return?

If a card with tiered or rotating rewards emerges as a strong contender for you, you now need to consider the extra attention they demand to monitor your monthly spending and which categories offer bonuses. You might decide that keeping track of tiered rewards is worthwhile if there are only two tiers on the card. But, cards with multiple tiers or rotating rewards may require more work than they’re worth based on your spending.

Are you comfortable with the expense of paying an annual fee?

While many rewards cards have no annual fee, you shouldn’t necessarily rule out those that do carry one. For-fee cards generally offer the highest earnings. If the earnings rate of a rewards card with an annual fee looks enticing, simply calculate the yearly earnings using your predicted spending, and then subtract the cost of the fee from the total. Then, compare how the earnings figure (less the fee) stacks up against other cards that don’t charge an annual fee.

Additional considerations when selecting a rewards credit card:

• Minimum qualification criteria (especially credit score)
• Whether you can realistically meet spending requirements to qualify for introductory bonuses
• Any fees (balance-transfer or foreign-transaction fees, for example)
• Other card benefits that may be valuable, such as travel insurance
• Whether the card offers a 0% APR introductory offer, and whether it applies to purchases, balances transfers, or both

How Can You Optimize Rewards Earnings?

Earning the most in rewards on a card entails taking advantage of all tiered or bonus spending categories, preferably up to the quarterly or annual cash-back maximum, if those are capped. It also requires planning spending so as to earn any one-time introductory bonus, if offered.

Since APRs for rewards cards tend to be on the high side, balance carriers are best advised to find a card with lower interest on which to carry over purchases—which usually means favoring non-rewards cards.

Also, consider taking advantage of shopping rewards apps that have their own rewards. Using one of those can allow you to double dip and amplify your rewards when shopping online. Even if you’re earning only one point per dollar on your card, the app allows you to get an extra value beyond that for the same spending. Also, it’s important to “point” out that if you anticipate carrying a balance on your points rewards credit card it can be suboptimal in terms of the overall rewards earnings, as interest paid on outstanding balances almost always negates any rewards earnings, if not more.

What Are Rewards Redemption Methods?

Credit card rewards are generally simple on the earnings side with cash-back, points or miles but can be more complicated in terms of redemption and the related points or miles values involved. Cash back is much more straightforward in terms of value. Below are some common redemption methods:

• Check—Surprisingly, most points can be converted to “cash back” since getting a check or a gift card is a common redemption option.
• Statement Credit—Cash back rewards can be redeemed as a credit against any charges on your monthly billing statement. Points and miles can sometimes also be converted to statement credits – typically at a rate of one cent per point or mile.
• Merchandise—Most point-redemption platforms allow points to be spent on name-brand merchandise. While this can be a tempting option, it is often the least advantageous in terms of value. Before going this route, then, it’s especially advisable to do the math, using the retail price of the item online, to determine the value you’re receiving for your rewards points.
• Gift cards—Whether it is to a national retailer or restaurant or in the form of a Visa gift card this is a popular redemption option. However, not all reward redemptions offer good value. Make sure you’re getting proper value (that is, at least one cent per point or mile) before choosing this option.
• Travel—Some reward programs allow points to be redeemed for airline tickets or hotel nights, which can provide superior points value.

Are Credit Card Rewards Taxable?

Luckily, the current IRS rules do not currently consider credit card rewards as taxable and the value of which do not need to be claimed on tax forms each April 15th. It’s likely this is because the rewards are earned by spending after-tax dollars on credit cards and are offered as an incentive by the card issuer. However, it is possible that the IRS may change their mind at some point in the future and begin taxing the value of rewards.

Are Rewards Credit Cards Worth It?

Rewards earned from rewards credit cards – whether in the form of cash back, miles or points, can be well worth the effort – with one big caveat. They really only make sense for consumers who pay their balance in full each month. That’s because the interest charges incurred when carrying a balance more than wipe out any benefit from any rewards that might be earned from incremental purchases. But, for those that do pay their balance in full each month, rewards are a way of leveraging their everyday spending to earn something back with every purchase to put toward travel, merchandise, gift card, or as a statement credit against their balance.

Another consideration in determining if a rewards card is worth it concerns the presence and amount of an annual fee. Many rewards cards come with no annual fee but for those that do it can be important to consider the value of any rewards that might be earned over the course of the year in order to determine if the fee is justified or not. For those that spend a lot on credit cards the rewards can be considerable. For low spenders the rewards can still be worth it but a no-annual-fee rewards card is probably a better fit.

About Our List of Points Rewards Credit Cards

For this list of the best rewards credit cards, we considered a range of card types, from cash-back cards to those affiliated with airlines and hotels to general travel cards in which the carrier issues their own points.

As part of our ongoing rating process we will re-score and publish updates of this list every month going forward.

Methodology

As part of our credit card review methodology, we gather scores of data points on more than 300 cards, including rewards, interest rate, fees, benefits, and security/customer service. Each card feature is then assigned a star rating and given a weighting based on its importance for various card categories. These weighted scores are then used to determine each card’s rating for various categories, such as cash back, travel, or balance transfer. To ensure our information is as up-to-date as possible, we deploy automated tools that monitor changes in such key data as annual percentage rates, introductory rates, introductory periods, bonus offers, rewards earnings rates, fees and card benefits. We then rapidly make any needed updates to our card listings, reviews, and recommendations to ensure that readers have the most reliable information and advice.