While most of the spot light is aimed at the credit cards with annual fees, due to high sign up bonuses, no foreign transaction fees, and many perks depending on the card. It seems that no fee cards don’t get as much attention, with the exception of a few. Credit cards with no annual fees should be an important piece to help extend your credit history and even help you maximize your reward earnings.
There are many credit cards with no annual fees, that earn rewards, that could very well deserve a spot in your wallet! Here are the ones I think you should consider. These are in no particular order.
Citi Double Cash:
The Citi Double Cash is probably one of the least exciting credit cards available, but it has a solid earning rate. You’ll earn 1% on all purchases and 1% on all payments. You should never hold a balance, if you’re playing the credit card game.
Unfortunately, there is no sign-up bonus, but while you’re earning 2%, you won’t need to worry about rotating categories, or quarter maximums. The cash does quickly add up and it doesn’t have to be used for travel expenses only.
Redemption is straight forward, as you can request a check, direct deposit or a credit statement.
Chase Freedom Unlimited
If Ultimate Rewards is your currency of choice, then this card is a must for your wallet. From a cash back stand point it earns 1.5% cash back or 1.5 Ultimate Reward points per dollar. The cash back earning is nothing to rave about. I mean from cash back earning standpoint, this is a poor choice when there are 2% cash back cards available.
The real value is when you have one of the premium Chase Cards ( Chase Sapphire Preferred, Chase Sapphire Reserve, or Chase Ink Plus). Earning 1.5 Ultimate Reward points per dollar for all non bonus spend is fantastic.
The current sign up bonus is $150 (15,000 Ultimate Reward Points) after spending $500 in the first 90 days. You will receive $25 (2500 Ultimate Reward Points) for adding an Authorize User as well. This bonus could increase periodically, just like the Chase Freedom to $200. That seems to come around once a year, so keep an eye out to see if that occurs.
Redeeming your points is pretty easy. You can redeem for cash, gift cards, credit statements, or even transfer to a premium Chase account to unlock more potential.
Discover It Miles
This could possibly the best card for year 1 for the non fee credit cards, for new cardholders. The Discover Miles credit card earns 1.5 “miles” per dollar spent (1.5% cash back). Don’t be confused, these miles can be turned in for cash back, it does not only relate to travel expenses.
Discover does not offer a bonus on the Discover It Miles credit cards, but….
While earning only 1.5 % cash back, why could this be the top no fee card out there? In your first year of opening the card, Discover will double your “miles” earned. Meaning you are earning 3% cash back on all purchases. After year 1, this card goes back to earning 1.5% and doesn’t keep pace with the 2% cash back cards.
The one perk worth mentioning is the $30 airline wifi credit. Just use your Discover Miles card to pay for the wifi, and Discover will credit you, up to $30 per year. This is a great perk for a no fee credit card.
Although, Discover isn’t as widely accepted internationally as Visa or Mastercard, there are no foreign transaction fees with this card as well!
Redeeming your miles is very simple, you can redeem against a travel charge, deposit into your account, or use as credit statement.
Chase Freedom
This seems to be in many peoples wallets and rightfully so! Just like the Chase Freedom Unlimited, it earns either cash back or Ultimate Reward points.
The current bonus is $150 (15,000 Ultimate Reward Points) after spending $500 in first 90 days, plus $25 (2,500 Ultimate Reward Points) after adding and authorized user. Usually Chase increases this bonus to $200 (20,000 Ultimate Reward Points) at some point during the year.
This credit card earns 5% ( 5x Ultimate Reward Points) categories on rotating categories,which change quarterly, which maxes out at $1500 per quarter. It also earns 1% back (1x Ultimate Reward Points) on all other transactions. I would only use this card for the 5% back and either have a 2% cash back card or if you like Ultimate Rewards, the Freedom Unlimited.
Just like the Freedom Unlimited, you unlock more value with the premium Chase credit cards.
Redeeming your rewards is simple, you can redeem for cash, gift cards, credit statements, or even transfer to a premium Chase account for more potential.
American Express Blue Cash Everyday
The bigger brother of this card gets more love than this one, but this is currently in our wallet and at no fee, there’s no need to cancel it.
The current bonus is a $100 credit statement after spending $1,000, plus earn 5% back on up to $4,000 in travel purchases for first 6 months (max of $200 cash back). If you search through an incognito browser, there have been offers as high as $250 credit statement. I would definitely make sure you search to find the best offer you can.
This American Express Blue Cash earns 3% at grocery store (up to $6,000 per year), 2 % at gas stations and department stores, and 1% everywhere else.
American Express also gives you a membership to Shoprunner, which gives you free 2 day shipping at a lot of online stores!
When redeeming your cash back, it must be in the form of a credit statement of gift cards. There is a way to have your credit statement sent to you to cash in :-).
Not only will you earn cash back on your purchases, you’ll also have access to American Express Offers. These can help save you money on purchases you were going to make, or you’ll be able to purchase gift cards to stores you use for a future purchase. These offers have helped saved me about $1,000 since I’ve started using these offers.
Discover It
This is very similar to the Chase Freedom. The Discover It has quarterly rotating 5% categories (spending a max of $1500) and 1% cash back on all other purchases.
Discover does not offer a sign up bonus for this card (sometimes you can find a $50 sign up bonus, but it is not available at this time), if you are in your first year of opening the card, Discover will double your cash back you earned! Meaning you will earn 10% on the rotating categories and 2% cash back for all non-bonus categories. They even will double the money you earn through Discover Deals, their shopping portal, which is possible one of the best cash back portals.
Looking at this card for strictly cash back, I think this is a better option than the Chase Freedom. You can redeem your Discover Cash for statement credit, cash, or gift cards. The real value is in redeeming for gift cards. You can redeem from anywhere 11% to 100% more value when redeeming your Discover Cash for gift cards.
There are no foreign transaction fees with the Discover It, but it is not as widely accepted as Visa or Mastercard.
This is a great compliment to the Chase Freedom, as they both have 5% categories and you can really maximize those 5% categories
American Express Everyday
This card is different than the other no fee cards on this list. This card earns Membership Reward points, which makes it a great option if you want a travel rewards earning card with no fee.
The current sign up bonus is 10,000 points after spending $1,000, but don’t apply for that offer. If you go through an incognito browser, you can get offers of 25,000 points for $2,000 spend. American Express has a one bonus per lifetime rule, so make sure you are receiving the highest bonus you can get!
The American Express earns 2 Membership Reward points at grocery stores and 1 Membership Reward point everywhere else. When you hit 20 transactions per month, you will receive a 20% bonus on those points. Meaning you’ll earn 2.4 Membership Reward points at grocery stores and 1.2 Membership Reward points everywhere else.
Not only will you earn flexible travel currency, you will have access to American Express offers as well! They always seem to have travel related offers as well. This could really help save you money on your travels!
Redeeming these points is usually best for travel, but you can also redeem for gift cards, statement credits, or cash. I would not recommend using your points for statement credits or cash, as you’ll receive much better value from cash back cards.
USAA Limitless Cash Back
A couple week I read from Danny Guru, about a new USAA credit card offering 2.5% cash back on all purchases! This could be the front runner for a spot in my wallet! Best of all, it has no annual fee, and no foreign transaction fees.
Currently it is being targeted to certain USAA members, sadly we weren’t one of them. It seems this card could out as soon as October 28th for all USAA members. While this may not be available for everyone, this could be a great card for people who are eligible for USAA credit cards.
This is a no frills credit card, but 2.5% cash back on all purchases is pretty hard to beat, right?
Conclusion:
There are many no fee credit cards out there to help you either get into the credit card reward game, help you earn more points, or cash back. These cards are an important piece of the puzzle to helping extending the age of your credit.
If you can juggle a few of these cards, you can earn a nice amount of cash back, or points to help book your next trip.
Do you own any of these cards? Any cards you think are great that are not on the list?
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