Best Credit Cards for March 2021
Credit cards help people reach their financial goals. The right card can help reach them faster.
Finding the credit card that best supports your financial goals doesn't have to be hard. It's a matter of matching credit card features to your lifestyle and what you're trying to achieve.
Balance transfer? Business credit card? Fewer fees, better perks, lower interest rate?
This curated list of popular credit cards can help you narrow the options to the best of the best. From there, it's easier to evaluate and compare features to arrive at the best credit card for you.
LIST OF WINNERS
Citi® Double Cash Card - 18 month BT offer - Best for Flat Rate Cash Back
Chase Freedom Flex℠ - Best for Tiered/Rotating Categories Cash Back
Blue Cash Preferred® Card from American Express - Best for Families
Citi® Diamond Preferred® Card - Best for Balance Transfer
Ink Business Preferred® Credit Card - Best for Business
Citi® Double Cash Card - 18 month BT offer: Best for Flat Rate Cash Back
The Citi® Double Cash Card - 18 month BT offer rewards you with what can amount to 2% cash back on every purchase you make. It's 1% cash back for every dollar you spend and 1% for paying your credit card bill. (Of course, payment must be made on time to earn rewards.)
But this card can also pull double duty. With an intro 0% APR on balance transfers, you can transfer other amounts onto the card and work on getting out of debt without paying a ton in interest. But balance transfers do not earn cash back rewards, and transfers must be completed within 4 months of opening your account. After the intro, the APR becomes 13.99% – 23.99% (Variable).
Cash Back Reward: The cash back reward is effectively 2% – 1% when you buy and another 1% when you pay your bill.
Intro Balance Transfer APR: 0% for 18 months
Ongoing APR: 13.99% – 23.99% (Variable), which is based on your creditworthiness.
Balance Transfer Fees: 3% of each balance transfer; $5 minimum.
Annual Fee: $0
Credit Needed: Excellent, Good
Chase Freedom Flex℠: Best for Tiered/Rotating Categories Cash Back
The new Chase Freedom Flex℠ is a hybrid among cash back credit cards, and the offer is pretty exciting. The cash back is both tiered and rotating, so you can earn:
- 5% cash back on purchases made in rotating quarterly bonus categories (up to $1,500 spent each quarter; activation required)
- 5% cash back on travel purchases made through the Chase Ultimate Rewards® portal
- 3% cash back on dining and drugstore purchases
- 1% cash back all other purchases
The other perks and benefits are generous too.
Welcome Bonus: Earn $200 cash back after you spend $500 within the first three months of account opening.
Intro APR: For a period of 15 months, enjoy 0% APR on purchases. Then the ongoing APR is 14.99% - 23.74% Variable, based on your creditworthiness.
Annual Fee: $0
Credit Needed: Excellent, Good
Blue Cash Preferred® Card from American Express: Best for Families
The Blue Cash Preferred® Card from American Express is a great card for families. It's so popular with consumers because of its generous cash back offer on everyday purchases. Case in point, cardholders can earn:
- 6% back at U.S. supermarkets up to $6,000 spent annually (1% beyond that).
- 6% on select streaming subscriptions.
- 3% back at U.S. gas stations and on eligible transit.
- 1% cash back on your other purchases.
Welcome Bonus: Earn a $300 statement credit after you spend $3,000 in purchases on your new card within the first six months.
Intro APR: Enjoy 0% intro APR on purchases for 12 months from the date of account opening. Then the ongoing APR is 13.99% - 23.99% Variable, based on your creditworthiness.
Annual Fee: $0 introductory annual fee for the first year, then $95
Credit Needed: Good, Excellent
Citi® Diamond Preferred® Card: Best for Balance Transfer
If you're looking for a long payback period on a popular balance transfer credit card, the Citi® Diamond Preferred® Card is clearly one of the best.
Intro Balance Transfer APR: 0% intro APR for 18 months from the date of your first transfer (when made within the first 4 months of opening your account); also, intro 0% APR on new purchases made in the first 18 months. After the intro periods, the APR becomes 14.74% - 24.74% Variable.
Balance Transfer Fees: 3% of each balance transfer; $5 minimum
Annual Fee: $0
Credit Needed: Excellent, Good
Ink Business Preferred® Credit Card: Best for Business
The Ink Business Preferred® Credit Card is good both for established businesses and startups. In addition to a solid rewards program, you get cell phone protection when you pay your cell phone bill with the card - and this applies to the primary phone and all the other phones on the account (terms and deductible apply).
Welcome Bonus: Earn 100,000 bonus Ultimate Rewards® points after you spend $15,000 within the first three months. It's worth $1,250 in travel when redeemed through the Ultimate Rewards® protal.
Ongoing APR: 15.99%-20.99% Variable
Annual Fee: $95
Credit Needed: Excellent, Good
What is a Credit Card?
A credit card is a convenient way to pay for purchases using a revolving line of credit - but you might think of it as a short-term loan.
Some credit cards come with additional perks such as cash back, rewards points, purchase protections and travel benefits.
How Do Credit Cards Work?
To receive a credit card, you must first fill out an application that asks for information such as your income and social security number.
Then the card issuer will check your credit score to determine whether to approve your application and, if so, decide how much credit to extend to you.
Once you've been approved, the card issuer agrees to pay for your purchases up to that certain amount, known as your credit limit. In return, you the repay the issuer for your purchases or at least make minimum payments each month on the amount you owe.
If you are unable to pay off your card's balance each month, the card issuer will charge interest on the amount you haven't repaid.
Advantages of Credit Cards
Credit cards come with some advantages not found with other payment methods:
If your card is lost or stolen, you legally can't be held responsible for more than $50 worth of unauthorized purchases.
(While many debit cards offer a similar level of liability protection, you risk having your bank account wiped out while waiting for fraudulent transactions to be reversed.)
Cash and travel rewards
Many of the best credit cards offer rewards of some type. Depending on the card, you may get as much as 6% cash back on purchases or earn points or miles that can be redeemed for cash, travel, merchandise or gift cards.
Travel and purchase benefits
What's more, many cards come with a long list of perks ranging from extended warranty protection for purchases to complimentary lounge access at airports.
Opportunity to easily finance large purchases
Rather than having to apply for a loan or save for months to make a larger purchase, you can instantly access your credit limit anywhere credit cards are accepted.
Types of Credit Cards
Credit cards are typically affiliated with one of four processing companies: Visa, MasterCard, American Express or Discover. Combined, they offer dozens of credit card options. These can broadly be broken down into the following categories:
A standard credit card may have few bells and whistles. It allows users to make purchases and pay them off over time. Some may have low credit card fees and introductory 0% APR offers for purchases and balance transfers.
Rewards credit cards can be broken down into numerous subcategories such as cash back, airline, hotel, travel and gas cards.
These cards offer points, miles or cash back for purchases and may offer additional protections such as trip interruption or delayed baggage insurance. In return for these rewards, card issuers may charge an annual fee.
What is a secured card? It's a credit card intended to build credit for those with no credit or bad credit. They typically require a deposit that is equal to the card's credit limit.
What is the easiest card to be approved for?
Secured cards are your best bet if you have limited credit.
Otherwise, many standard cards are available to those with average credit scores. Typically, the more lucrative rewards cards require very good or excellent credit.
What is a Credit Limit?
A credit limit is the amount of money you are pre-approved to spend on your credit card. Once your balance reaches your credit limit, you can no longer make charges to your card.
But your balance is not simply the amount of purchases you've made with your credit card. Purchases, balance transfers, interest and fees are all part of your credit card balance.
What is APR?
"APR" stands for "annual percentage rate." It's how much interest you'll pay on any balance you carry.
So what is 24% APR on a credit card? It means, over the course of the year, you will spend 24% more to pay off your card if you carry a balance.
For example, let's say your balance is $1,000. Assuming you don't make any payments, you will owe $1,240 at the end of 12 months. Of course, this is a simplified example; and if you didn't pay anything for a year, your balance would actually be higher because of late and over-the-limit fees.
What is a Grace Period?
Credit cards provide a grace period before they start charging interest.
If you pay off your purchase within the grace period, you won't have to pay interest. Legally, credit card companies must provide a 21-day grace period, but some issuers offer longer grace periods, such as 25 days.
Credit Card Fees
Before you sign up for a credit card, you should understand the fees that may come with their use. Here are a few to know:
Credit card processing fees
These fees are usually paid by a retailer or merchant, but they may be passed on to you by some companies. Before making a large purchase with a credit card, ask if there is a fee to do so.
Cards that come with extensive rewards and perks are most likely to charge cardholders an annual fee.
Foreign transaction fee
Most commonly set at 3%, a foreign transaction fee is charged by some, but not all, cards when you make a purchase in a foreign currency.
Balance transfer fee
If you are transferring a balance from one card to another, many cards charge a balance transfer fee (which is a percentage of the amount transferred).
Cash advance fee
This fee may be charged if you access money from a credit card using an ATM. Similar to a balance transfer fee, a cash advance fee is typically a percentage of the amount you withdraw.
Over-the-limit and late fees
If you go over your credit limit or pay your bill late, you could get hit with a flat fee that may be as high as $39.
Reasons to Use a Credit Card
All the advantages listed above are good reasons to get a credit card. However, if you need a few more, consider the following:
1. Ease of payment
Credit cards are accepted by most retailers nowadays, and you won't have to worry about losing cash or fumbling with change at the register.
2. Simplified recordkeeping
If you do most of your spending on a credit card, it's easy to track expenses and manage your budget.
3. Chance to build credit
When used properly, credit card cards can increase your credit score and extend your purchasing power.
How Many Cards Should You Have?
There is no one right answer to this question. How many credits cards you have depends on your financial situation and spending needs.
However, most people benefit from having at least two cards, if not more.
If you plan to carry a balance…
If you plan to carry a balance, it's best to find a card with an introductory 0% APR.
If you can pay your balance off each month…
For expenses that you can pay off each month, look for a rewards card that offers cash back or points for your purchases.
Note: If possible, you don't want to carry a balance on a rewards card since they often have higher APRs, and interest charges can quickly offset the value of any rewards you receive.
If you plan to travel…
If you travel frequently, it may also be a good idea to get cards affiliated with your favorite airline and hotel chain. These often come with complimentary elite status or other similar benefits.
If you're a business owner…
If you own a business, getting a business card is a smart way to ensure your company's finances don't intermingle with your personal accounts.
Another reason to apply for multiple cards is to receive the lucrative welcome offers available on many rewards cards. These provide hundreds of dollars in cash back or thousands of bonus points or miles to new cardholders who spend a specific amount on purchases within a certain period of time.
What is the easiest credit card to get approved for?
Start with one that has credit requirements matching your own score. As you browse credit cards on MoneyRates, you'll find the credit requirements listed, and there are options for people with no credit all the way to those with excellent credit.