In this post, I’ll discuss the most lucrative travel rewards credit cards for everyday spending. Several of the best credit cards for award travel earn bonus points in certain categories such as travel and dining. Anytime you make a purchase that codes as one of these categories, you will earn an extra point or two (or three) per dollar.
Transferable points are key
Many people who are new to this ask me which credit card is best for everyday spending. I highly encourage most people to use cards that earn flexible rewards such as Chase Ultimate Rewards or American Express Membership Rewards. Miles earned from the Capital One Venture Rewards Credit Card are also transferable.
When you use an airline or hotel co-branded credit card, you earn the miles or points for that airline or hotel. Your redemption options are limited to that airline or hotel program. But if you earn a transferable bank currency, you’ll have more redemption options. This helps in two ways. First, if you cannot find availability for a redemption using miles from one airline, you can check options with other airlines. Second, you may be able to redeem less miles or points by using a different airline. If you only collect miles with one airline, you will not have these options.
For instance, if I’m trying to book a nonstop flight between DFW and Cancun operated by American Airlines, I can transfer Chase Ultimate Rewards to British Airways to book the ticket after confirming availability. But if I’m trying to book a flight to Europe in business class, a different Chase partner such as United Mileage Plus or AirFrance Flying Blue will probably result in a better redemption cost.
I suggest reading the beginner’s guide before applying for any cards because there are reasons that Chase cards should take priority if you’re new to this. After you’ve opened the Chase cards you want, you can move on to cards from other issuers such as American Express and Capital One.
Quality over quantity
High earn rate does not necessarily mean high return. Not all miles and points are equal, so making sure you’re earning the most valuable points is just as important as the number. For example, I value 60,000 Chase Ultimate Rewards points more than twice as much as 60,000 Marriott Bonvoy points. You have to consider what kind of redemptions that any given type of reward currency can book.
Bonus categories should not determine which card you open
Bonus categories are a great way to earn more points, but I’ll explain why you should not open a credit card just because you like the bonus categories.
Bonus categories are not as important as you may think
The best cards for everyday spending depend on your spending habits, but bonus categories are not as important as you may think, especially if you are a beginner.
There are 2 ways to earn miles and points from credit cards*.
- The first is by earning welcome bonuses when opening a new card.
- The second is from everyday spending. Some cards have bonus categories such as dining and travel. While it’s always great to earn an extra point or two per dollar with category bonuses, welcome bonuses are the best way to get a large return on your spending.
As a beginner, much of your spend will be on whichever card you’re trying to meet a minimum spending requirement to earn a welcome bonus. And the card with the best welcome bonus may not necessarily be the best card for a bonus category. In many cases, you would have to spend a huge amount in that category in order for the category bonus to be a reason to open one card over another card with a better welcome bonus.
Here is an example:
If you spend $4,000 per year at restaurants, there are cards that earn extra points per dollar on dining purchases. Here are a few:
- 4 points per dollar: American Express Gold Card (that’s 16k Amex points on $4k annual spend at restaurants)
- 3 points per dollar: Chase Sapphire Reserve (12k Ultimate Rewards points on$4k annual spend at restaurants)
- 3 points per dollar: Chase Sapphire Preferred (12k Ultimate Rewards points on $4k annual spend at restaurants)
*Unlike typical credit cards, the Amex Gold Card allows you to carry a balance for certain charges, but not all.
If you are a beginner and you are looking for your first credit card, I’ll show you why category bonuses should not be a determining factor. Each of these cards has a welcome bonus:
- American Express Gold Card: 60,000 after spending $4,000 in the first 6 months. Terms apply.
- Chase Sapphire Reserve: 50,000 Ultimate Rewards after spending $4,000 in the first three months
- Chase Sapphire Preferred: 60,000 Ultimate Rewards points after spending $4,000 in the first three months
Note that the minimum spending requirement does not need to be restaurant spend; any purchases would count, but for the purpose of this example, we’re going to pretend it’s all restaurant spend.
- American Express Gold Card: 76,000 Amex Membership Rewards points (60,000 plus 16,000)
- Chase Sapphire Reserve: 62,000 Chase Ultimate Rewards points (50,000 plus 12,000)
- Chase Sapphire Preferred: 72,000 Ultimate Rewards points (60,000 plus 12,000)
Note: You could make the argument that Chase Ultimate Rewards points are more valuable than Amex Membership Rewards points or vice versa depending on what your goal is, but I generally value both of these currencies equally. So we’re going to assume equal value for this example. As I stated earlier, another currency, such as Marriott Bonvoy points, may not have equal value.
Even though the Amex Gold Card earns more than the Chase Sapphire Preferred at restaurants, the Chase Sapphire Preferred would still be the better card to open.
Best credit cards for everyday spending and bonus categories
First of all, if you’re working on a minimum spending requirement, you’ll obviously want to put all of your purchases on that card until you meet the minimum. After that, if you want to maximize your earning potential, you may need to switch your spending to a different card.
Remember, we’re only considering everyday spending and category bonuses for this list. The best cards for everyday spending/category bonuses may not necessarily be the cards with the best welcome bonuses. The welcome bonus should be a larger factor when determining which card you should open. Other factors that should determine the best card to open are annual fees and benefits.
Some cards will be listed in multiple categories, so I’ll cover each card’s details at the first mention. Also, the cards below are personal cards. You find more info about business cards on the list of our favorite current offers.
Credit cards with the best everyday earn rates
The non-category bonus earn rate on most cards is going to be 1 point or mile per dollar, but there are a few cards with higher rates. The Chase Freedom Unlimited and the Capital One Venture Rewards Credit Card both make great everyday spending cards.
Chase Freedom Unlimited
The Chase Freedom Unlimited card earns 1.5 Ultimate Rewards points per dollar on all non category purchases, which is higher than the non-category bonus earn rate on other Chase Ultimate Rewards earning cards such as the Chase Sapphire Preferred, Chase Sapphire Reserve, or Chase Ink Business Preferred.
- Currency earned: Chase Ultimate Rewards
- Earn rate:
- 5% on travel purchased through Chase Ultimate Rewards
- 3% at restaurants
- 3% on drugstore purchases
- 1.5 % unlimited cash back on all other purchases.
- Annual fee: $0
- Welcome bonus: $200 (or 20,000 Ultimate Rewards points) after spending $500 in the first 3 months. Also, earn 5% cash back (or 5 points per dollar) on grocery store purchases (excluding Target or Walmart) on up to $12,000 spent in the first year.
The earn rate on this no annual fee card makes it appealing, but I only recommend opening it if you also have one of the three cards that earn transferable Chase Ultimate Rewards (Chase Sapphire Preferred, Chase Sapphire Reserve, or Chase Ink Business Preferred).
Capital One Venture Rewards Credit Card
I finally decided to give the Capital One Venture card some consideration when Capital One added transfer partners in late 2018. Prior to that, this was essentially a cash back card. To redeem the rewards for travel, you simply used your miles as a purchase “eraser”. Now, you can transfer miles to airline programs or you can redeem the miles to erase travel purchases.
This post has more details plus a comparison between your earning and redeeming potential on both the Capital One Venture and another everyday spending favorite, the Chase Sapphire Preferred. When it comes to redeeming with transfer partners, 2 miles per dollar is a little misleading, but the Capital One Venture is still a great card if you prefer simplicity.
I value rewards earned with the Chase Sapphire Preferred higher than those of the rewards earned with the Capital One Venture, but some people prefer the simplicity of a cash-back type currency and this card definitely has one of the best earn rates in that case.
Another notable benefit is Global Entry. Receive up to $100 in reimbursement for Global Entry or TSA Precheck. Click here for more information about the Capital One Venture.
Best cards for spending on travel
- The Platinum Card from American Express (5 points per dollar on flights booked directly with airlines and on travel booked at amextravel.com.)
- Chase Sapphire Reserve (3 points per dollar)
- Chase Sapphire Preferred (2 points per dollar)
- American Express Green Card (3 points per dollar)
- American Express Gold Card (3 points per dollar on flights booked directly with airlines and on travel booked at amextravel.com.)
One important thing to point out here is that it’s important to look at what qualifies for the category bonus points. For example, both Chase cards on this list have broader definitions of travel than the Amex Platinum. The Amex Platinum only earns extra points on flights booked fdirectly with airlines or travel booked on amextravel.com.
Booking a hotel directly through that hotel’s website would earn 3 points per dollar with the Chase Sapphire Reserve. If you use your Amex Platinum to book a hotel direct, you would not receive the 5 points per dollar.
I’ll specify what kind of travel purchases qualify under each card, but one that deserves a mention is the American Express Green Card. Unlike the travel bonus categories on the Platinum and the Gold cards, the Green Card expands travel to include including airfare, hotels, cruises, car rentals, campgrounds, trains, taxicabs, rideshare services, tours, ferries, tolls, parking, buses, subways, on third party travel websites, and on amextravel.com.
The Platinum Card from American Express
If you’re a frequent flyer, The Platinum Card from American Express has one of the highest earn rates when purchasing flights. The annual fee is $695 [rates and fees], but there are lots of benefits and credits that may help offset that fee. The current welcome offer of 100,000 American Express Membership Rewards points also helps offset that annual fee.
- Currency earned: American Express Membership Rewards
- Earn rate: 5 miles per dollar on flights booked directly with airlines and on travel booked at amextravel.com on up to $500,000 per calendar year. Earn 1 point per dollar on all other purchases.
- Annual fee: $695
- Welcome bonus:
Earn 100,000 American Express Membership Rewards points after spending $6,000 in the first 6 months. Also, new cardmembers receive 10 points per dollar on purchases at restaurants and when you shop small in the US on up to $25,000 in combined purchases during the first 6 months.
The Platinum Card from American Express will grant you access to their amazing Centurion lounges (where available). These lounges have complimentary food and drinks, and there are spa services at select locations! .
Additional travel benefits and details: Receive up to $200 of reimbursement on airline incidentals per calendar year, receive $200 total in Uber credits annually, receive $100 reimbursement for TSA precheck or Global Entry enrollment, and 100$ total in statement credit for purchases at Saks Fifth avenue annually. More benefits were recently added. Terms apply.
Chase Sapphire Reserve
The Chase Sapphire Reserve earns 3 points per dollar on any purchase that codes as travel. This would include hotels, plane tickets booked from airlines or from online travel agencies, Uber, Airbnb, and much more.
- Currency earned: Chase Ultimate Rewards
- Earn rate: 3 Chase Ultimate Rewards points per dollar on travel and dining, 1 point per dollar on all other purchases
- Annual fee: $550
- Welcome bonus: 50,000 Ultimate Rewards points after spending $4,000 in the first 3 months
The annual fee is high but I’ll discuss the travel benefits that help offset that fee. First, you receive a $300 credit annually for travel purchases. This includes airlines, hotels, Uber, train tickets, online travel agencies (Expedia, etc), so it’s not very tough to use. There is also a credit for Global Entry ($100). In addition, you will receive a Priority Pass membership which grants you access to participating Priority lounges worldwide.
A few new benefits were recently added to the Chase Sapphire Reserve.
- Free Lyft Pink for a year (which normally costs $19.99 per month). Notable benefits are 15% off of Lyft rides and priority pick ups at airports
- 10 points per dollar on Lyft rides when you pay with your Chase Sapphire Reserve
- $60 credit per year in 2020 and 2021 with DoorDash
- A free year of DashPass (normally $9.99 per month)
If you’re able to use some of these credits and benefits, they more than offset the recent annual fee increase.
The other benefit to this card (as opposed to the Chase Sapphire Preferred) is that your points are worth more when you redeem through the Chase Ultimate Rewards travel portal. The redemption rate is 1.5 cents per point. So 50,000 Ultimate Rewards are worth $750. Of course, you can also transfer those Ultimate Rewards to Chase’s airline and hotel partners at a 1:1 ratio.
Note that you cannot have a Chase Sapphire Preferred and a Chase Sapphire Reserve open at the same time. But if you have the Chase Sapphire Preferred and it has been more than 48 months since you last received a welcome bonus, you can downgrade to a no annual fee Freedom Unlimited and then open the Chase Sapphire Reserve. In order to do this, you would need to be under 5/24.
Chase Sapphire Preferred
The Chase Sapphire Preferred earns 2 or 5 points per dollar on travel, and the lower annual fee and higher welcome bonus make it a more appealing card than the Chase Sapphire Reserve.
- Currency earned: Chase Ultimate Rewards
- Earn rate: Earn 5 points per dollar on all travel purchased through Chase Ultimate Rewards, 2 points per dollar on all other travel. 3 points per dollar on dining (including eligible delivery services and takeout), 3 points per dollar on select streaming services, 3 points per dollar on online grocery purchases (this excludes Target, Walmart and wholesale clubs), and 1 point per dollar on all other purchases.
- Annual fee: $95
- Welcome bonus: 60,000 Ultimate Rewards points after spending $4,000 in the first 3 months.
The welcome bonus is worth at least $750 in travel when you redeem via the Ultimate Rewards portal, the annual fee is reasonable, and the rewards are easy to earn and redeem.
You can transfer Chase Ultimate Rewards to 11 different airline frequent flyer programs or 3 different hotel loyalty programs. You can also redeem the points through the Chase Ultimate Rewards redemption portal. Each point can be redeemed for 1.25 cents. That makes the welcome bonus of 60,000 Ultimate Rewards points worth $750!
American Express Green Card
The American Express Green Card recently received a facelift. Unlike the other Amex cards on this list, the Green Card expands travel to include including airfare, hotels, cruises, car rentals, campgrounds, trains, taxicabs, rideshare services, tours, ferries, tolls, parking, buses, subways, on third party travel websites, and on amextravel.com.
- Currency earned: American Express Membership Rewards
- Earn rate: 3 points per dollar on travel and at restaurants. All other purchases earn 1 point per dollar.
- Annual fee: $150 [rates and fees]
- Welcome bonus: 30,000 miles after spending $2,000 in the first 3 months
American Express Gold Card
The American Express Gold Card earns up to 3 points per dollar on travel.
- Currency earned: American Express Membership Rewards
- Earn rate: 3 points per dollar on flights booked directly with airlines or travel booked at amextravel.com. All other travel purchases would be 1 point per dollar. 4 points per dollar at restaurants and US supermarkets on up to $25,000 per year, 4 points per dollar on Uber Eats purchases. All other purchases earn 1 point per dollar.
- Annual fee: $250 [rates and fees]
- Welcome bonus: 60,000 miles after spending $4,000 in the first 6 months
At $250, the annual fee seems high, but there are some benefits that may offset that.
For flights, this earn rate is not as good as the rate on the Platinum Card. It’s the same as Chase Sapphire Reserve and the American Express Green card, but those cards have better definitions of travel in terms of bonus category. I decided to add the Gold Card to this list, though, because this is one of my favorite cards for everyday spending (you’ll see it again on this list in more categories). 3 points per dollar on flights is as good or better than most of our other favorite travel cards, but the categories that really stand out are restaurants and US supermarkets.
Best cards for dining
A few airline and hotel cards now have restaurants as a bonus category, most with a rate of 2 points per dollar. Since I suggest earning flexible bank currencies instead, I’ve only considered cards that earn said currencies.
Best cards for grocery stores
- American Express Gold Card (4 points per dollar at US Supermarkets on up to $25k per year)
- Amex Everyday Credit Card (2 points per dollar at US Supermarkets on up to $6k per year)
Which card should I use on shopping portal purchases?
If using the Chase Ultimate Rewards portal:
Terms state that you must purchase with your Ultimate Rewards card to earn the bonus points.
If using an airline portal:
Basically, the same card you would use for non-category bonus spend. You typically do not have to use an airline co-branded card to earn bonus points through an airline’s shopping portal.
- Chase Freedom Unlimited
- Capital One Venture Rewards Credit Card
or any card that earns transferable currencies such as Chase Ultimate Rewards and American Express Membership Rewards.
American Express Offers
You must use the American Express card for which the offer is saved.
Amex Offers are a great way to save money or earn extra points at different retailers. Find offers from different brands-for dining, shopping and more. Add the offers to your card then use your card when you pay. Some offers are for cash back and will post as statement credits on your bill, and some offers earn Bonus American Express Membership Rewards.
If you’re working on a minimum spending requirement, you’ll obviously want to put all of your purchases on that card until you meet the minimum. After that, if you want to maximize your earning potential, you may need to switch your spending to a different card.
For example, if you have a Chase Sapphire Preferred and then you open a World of Hyatt credit card, you will want to put all of your spend on the Hyatt card until you meet the minimum spending requirement. After that, you may want to switch your spending to your Chase Sapphire Preferred card. The points earned from CSP, Chase Ultimate Rewards, are transferable to Hyatt, plus they are transferable to 11 airline programs. In other words, you have more redemption options if you earn Chase Ultimate Rewards points.
Cards with category bonuses that match your spending habits are definitely something to consider, but it’s important to remember the big picture. In many cases, you would have to spend a huge amount in a category in order for that to be the deciding factor. I often hear “I spend X amount on Y every year, what’s the best credit card?” This is actually a great question, but it’s important to remember that you’re going to get a much larger return on your spending when you open a new card and earn a welcome bonus.
Amex Rates and Fees:
- American Express Gold Card [rates and fees]
- The Platinum Card from American Express [rates and fees]
- American Express Green Card [rates and fees]
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