With mass distribution of the coronavirus vaccine underway, credit card issuers hope customers will return to their pre-pandemic spending habits. That of course will mean something different for everyone, as the pandemic affected personal finance in many different ways. If you’re looking to utilize credit cards in your monthly spending (or never stopped over the last year), here are Money’s picks for the best credit cards across 12 different categories.
The Best Credit Cards in 2021: What to Look For
The right credit card for you will depend on how you will use it, much like choosing a car or buying a pair of shoes.
Reward cards are ideal for anyone who avoids interest by paying their balances in full every month. For those who don’t see traveling much in 2021, but still want to earn rewards, a cash back card or a store credit card can make the most sense. But with COVID-19 vaccines on the way, others are looking forward to taking a much needed vacation at some point in 2021. Airline and hotel cards are great ways to earn free flights and stays, while general travel rewards cards are ideal for award travel enthusiasts who know how to redeem their rewards for the most value.
Yet millions of Americans are unable to pay off their credit card balances each month, and can benefit from cards that reduce or eliminate their interest charges. These include cards with low standard interest rates and others with 0% APR promotional financing offers for new purchases, balance transfers, or both.
Then there are niche cards that fill specific needs. For example, students who are looking to build their credit have specific cards designed for them. And if you’ve had serious credit problems, a secured card can offer a valuable way to rebuild it. Small business owners have cards that they can use to earn rewards while separating their personal and business expenses. Finally, there are those who eschew all manner of complicated reward cards and other features, and just want a simple card for use to make purchases.
When shopping for a new credit card, you first need to take into account what credit cards you can be approved for, based on your credit score when you apply. Only those with excellent credit will qualify for the best reward cards, or the cards with the most attractive financing offers.
Best Credit Cards 2021: Best Cash Back Card
Why it won: When it comes to earning lots of cash back on many of the purchases you make the most, this card can’t be beat. First, there’s the whopping 6% cash back that you receive on up to $6,000 spent at U.S. supermarkets each year. You also receive 6% back on select U.S. streaming subscriptions and 3% back on transit and at U.S. gas stations. You earn 1% cash back on all other purchases. This gives you the chance to earn up to $360 in cash back each year on groceries alone.
This card currently offers new accounts $300 cash back after spending $3,000 in purchases within first six months of account opening, and features 12 months of intro 0% APR financing on new purchases (13.99%-23.99% APR after). All of these opportunities to earn cash back make it well worth the card’s $95 annual fee, which is waived the first year.
Runner up: Citi® Double Cash
Why it won: One way to maximize the cash back that you earn from your reward credit cards is to forget about bonus categories such as extra cash back on featured merchants and simply find the card that offers the highest rate for cash back for all purchases, all of the time. The Citi Double Cash may be the ideal card for people who prefer this strategy. It offers one percent cash back every time you make a purchase, and another one percent cash back when you pay for your purchases, for a total of up to 2% cash back.
These cash back rewards apply to all purchases, and there’s no limit on the amount of cash back that you can earn. And if you also have a Citi ThankYou Premier or Prestige card, then you can transfer your rewards from your Citi Double Cash card to ThankYou points, offering plenty of other ways to redeem these points. There’s also no annual fee for this card.
Best Credit Cards of 2021: Best Travel Rewards Card
Winner: Capital One Venture Rewards
Why it won: The Capital One Venture Rewards card offers double miles on all purchases, and plenty of ways to redeem your miles for award travel. With this card, you can use your Capital One miles for one cent in value towards travel reservations booked with your card. Eligible purchases include airfare, hotels, car rentals, trains, busses, cruises, taxies, rideshare services and anything purchased from a travel agency.
Alternatively, you can transfer your Capital One miles to frequent flyer miles with 14 airline partners, or hotel points with Wyndham Rewards. And when you can redeem these rewards for expensive flights in business or first class, or valuable hotel and vacation rental stays, then it’s possible to receive even more value from your rewards. Benefits include Auto Rental Collision Damage Waiver, Extended Warranty and up to a $100 credit towards the application fee for TSA PreCheck or Global Entry. There’s a $95 annual fee for this card, and no foreign transaction fees.
Runner up: Chase Sapphire Reserve®
Why it won: This premium rewards card has become the go-to product for both frequent travelers and award travel enthusiasts. It offers you 3X points per dollar spent on eligible travel and dining purchases, and one point per dollar spent elsewhere. Also, earn 7X points (for a total of 10X points) on qualifying Lyft rides and receive complimentary Lyft Pink membership for 12 months, which offers lower pricing through March 2022. And when you redeem your points for travel booked through the Chase Ultimate Rewards Travel Center, they are worth 1.5 cents each towards airfare, hotels, car rentals, cruises and activities. You also have the option of transferring your points to airline and hotel partners.
Among its extensive benefits are a $300 annual travel statement credit and a $100 credit towards the application fee for TSA PreCheck or Global Entry. You even get a $60 credit toward Doordash in 2021. This card also includes a Priority Pass Select Membership, which offers access to over a thousand airport lounges around the world. Finally, this card comes with numerous travel and purchase protection benefits. There’s a $550 annual fee for this card, and no foreign transaction fees. But if you utilize all of these statement credits and other benefits, the net cost to you will be close to $0.
Best Credit Cards of 2021: Best Student Card
Why it won: Here’s a card from a major issuer that’s perfect for students to use and learn to build credit. It has no annual fee and offers 1% cash back on all purchases. Also, Capital One encourages students to manage their card responsibly by offering an additional 0.25% cash back when you make your payment on-time, bringing your total cash back to 1.25%. This card even provides you with a $60 streaming subscription credit in the form of $5 per month for 12 months on select streaming subscriptions when you pay on time.
This card has no annual fee and no foreign transaction fees, and includes plenty of other valuable features and benefits. The CreditWise program allows students to keep track of their credit score and learn how to improve it. The Automatic Credit Line Review means Capital One will automatically review your account after six months to see if you’re eligible for a credit line increase. It even includes the Premier Access program that gives you special chances to purchase tickets towards entertainment, sports and culinary events. For students, it doesn’t get much better than this.
Runner up: Discover It® Student Chrome Credit Card
Why it won: The Discover It card has legions of fans due to its low fees and simple policies. And this version of this card includes additional features that make it ideal for students. It offers 2% cash back at gas stations and restaurants, including takeout and delivery on up to $1,000 in combined purchases each quarter. You also earn unlimited 1% cash back on all purchases. Furthermore, the Discover It Student Chrome Credit Card will automatically match the cash back you’ve earned during the first year of your account (applied at the end of your first year).
This card even features a Good Grade Reward that offers a $20 statement credit each school year your GPA is 3.0 or higher, for up to five years. This card has no annual fee, no foreign transaction fees and will automatically waive your first late payment fee. And most importantly, the Discover It Student Chrome Credit Card has won awards and earned a reputation for strong customer service.
Best Credit Cards of 2021: Best Airline Card
Why it won: This discount carrier is rapidly expanding, and its innovative credit card boasts several valuable features unavailable from other airline credit cards. While many credit cards offer 2X or even 3X miles for your ticket purchases, the Frontier Airlines World Mastercard gives you 5X miles on all eligible Frontier Airlines purchases at flyfrontier.com. You also receive 3X miles on your restaurant purchases and one mile per dollar spent elsewhere.
However, this card is unique in that you always earn one elite qualifying mile per dollar spent, allowing you to achieve elite status solely through the credit card if you choose. Having elite status with a discount carrier like Frontier allows you to avoid many of the ancillary fees that are part of this business model. Credit card holders can also utilize family pooling to combine miles towards an award flight. So, instead of having to take 10 flights to earn a free trip, a family of five might just have to take two flights together to earn a single award ticket.
Other benefits include priority boarding and an award redemption fee waiver. And even though this card has a $79 annual fee, you can earn a $100 Flight Voucher every account anniversary after spending $2,500 or more on purchases with your card.
Runner up: United ClubSM Infinite Card from Chase
Why it won: The best reason to have an airline credit card these days is for all of the benefits you’ll receive when traveling with the carrier. The United Club Infinite Card from Chase is loaded with premium benefits that you can use when flying on United. The big one is the United Club airport lounge membership, which is valued at $650 a year. You also receive your first and second bags checked free for both yourself and a companion traveling with you ON the same reservation, and you use the card to pay for it.
Other benefits include priority check-in, security screening (where available), boarding and baggage handling privileges, a 25% discount (in the form of a statement credit) on in-flight purchases and a $100 statement credit towards a Global Entry or TSA PreCheck application fee. You even receive access to Premier upgrades on award tickets and Hertz Gold Plus Rewards® President’s Circle® Membership.
When used for spending, you’ll receive 4X per dollar spent on purchases from United, and 2X miles spent on all other travel purchases as well as on dining at restaurants and eligible delivery services. There’s a $525 annual fee for this card, but even that is waived the first year.
Best Credit Cards of 2021: Best Hotel Card
Winner: World of Hyatt card from Chase
Why it won: The strength of this card relies on the exceptional value offered by the World of Hyatt loyalty program, which many regard as the best in the business. When you receive this card, you’ll immediately be granted Discoverist status in the World of Hyatt program, which offers you perks like free internet service, upgrades to preferred room and a 2:00pm late checkout.
But with this card, it’s very easy to reach higher levels of status. Cardholders automatically receive five qualifying night credits towards the next tier of elite status, and another two qualifying night credits for every $5,000 spent on the card. You also receive one free night at any Category 1–4 Hyatt hotel or resort every year after your cardmember anniversary, and can earn an extra free night if you spend $15,000 during your cardmember anniversary year.
When you make purchases at Hyatt hotels, you’ll receive 4X points, as well as 2X points for purchases at restaurants, on airline tickets purchased directly from the airline, local transit and commuting, as well as fitness club and gym memberships. Free nights at Hyatt hotels start at 5,000 points, with many great properties requiring just 8,000 to 15,000 points per night. There’s a $95 annual fee for this card.
Runner up: Hilton Honors American Express Surpass® Card
Why it won: The Hilton Honors American Express Surpass® Card excels at both offering you benefits and allowing you to earn exceptional rewards. Benefits include complimentary Gold Status in the Hilton Honors program, which offers you late check-outs, upgrades to preferred rooms and even free breakfasts at many properties. And if you use this card to spend $40,000 in a calendar year, then you’ll receive top-tier Diamond status through the end of the next calendar year. Also included is a free weekend night reward after you spend $15,000 with your card in a calendar year.
Another benefit is 10 free visits each year to lounges in the Priority Pass Select network. When used for purchases, you’ll earn 12X points on Hilton purchases and 6X points on groceries, dining and gas. You earn 3X per dollar spent on all other purchases. This card has a $95 annual fee and no foreign transaction fees.
Best Credit Cards of 2021: Best Simple Card
Winner: PenFed Gold Visa® Card
Why it won: There are many credit card users who just want to use a basic card with the lowest interest rates and the fewest fees. If this sounds like you, then you should consider the PenFed Gold Visa® Card, which is offered by the Pentagon Federal Credit Union. It has no annual fee annual fee, no cash advance fee and no foreign transaction fees. It currently offers a standard interest rate of 7.49% to 17.99%, depending on your creditworthiness at the time of your application. It also offers new accounts 12 months of 0% introductory APR on balance transfers, with a 3% balance transfer fee.
Even though this isn’t a rewards card, you can still receive a $100 statement credit when you spend $1,500 within the first 90 days of the account opening. To apply, you must become a member of the credit union, but no military service is required to join. If you are looking for a no-frills card with low rates and few fees, then this card is for you.
Runner up: Citi Simplicity®
Why it won: As its name implies, the Citi Simplicity is also a strong contender for those looking for a simple credit card. In addition to having no annual fee, this card also has no late fees and no penalty interest rate. This card doesn’t offer rewards for spending, but new applicants receive 18 months of 0% intro APR financing on both new purchases and balance transfers, with a 3% balance transfer fee. The on-going APR after is 14.74% – 24.74% APR.
Other features include compatibility with digital wallets, a chip for contactless payments and the ability to choose your payment due date. And while it has few travel insurance and purchase protection benefits, this card helps to fill the niche demanded by credit card users who want a simple, secure and convenient method of payment, without any extra bells and whistles.
Best Credit Cards of 2021: Best Low Interest Rate Card
Winner: Navy Federal Platinum
Why it won: About half of all American credit card users will carry a balance at some point during the year. If you incur interest charges on your credit card, then your first priority should be to minimize the amount of interest you pay by finding a card with the lowest standard interest rate. The Navy Federal Platinum currently offers a standard interest rate of as low as 5.99% for the most highly qualified applicants, although less qualified cardholders could receive a standard rate of as high as 18% APR. But considering the average interest rate for credit cards in the United States is around 15%, this is an incredibly low rate.
Having a low interest rate wouldn’t be that great if the card was filled with fees. Thankfully, that’s not a problem as this card has no annual fees, no balance transfer fees, no foreign transaction fees, and no cash advance fees. It even includes a reasonable number of cardholder benefits such as a Collision Damage Waiver, travel and emergency assistance, extended warranty service and a cell phone protection plan. And while you need to be a member of the Navy Federal credit union, it is free to join and no military service is required.
Runner up: First Classic Visa from First Command
Why it won: The First Classic Visa from First Command credit union has an exceptionally low standard interest rate, currently 6.99% variable APR. As with nearly all credit cards, this is a variable rate that can rise with the Prime Rate.
Surprisingly, this card offers both an extremely low standard interest rate and a rewards program. You can earn one point per dollar spent on most purchases, and 1.5 points per dollar spent on exchange and commissary purchases at US military bases. With the ScoreCard rewards program, you can redeem your rewards for travel, cash back, merchandise and charitable donations.
This card has a minim credit limit of $500 and no annual fee and no foreign transaction fees imposed on charges processed outside of the United States.
Best Credit Cards of 2021: Best Balance Transfer Card
Winner: US Bank Visa® Platinum
Why it won: When you’re trying to pay down your existing credit card debt, opening a new account with 0% APR on balance transfers can save you a lot of money. The US Bank Visa Platinum leads the field by offering 20 billing cycles of interest free financing on both new purchases and balance transfers (after that 14.49%-24.49% APR). Nearly all 0% APR balance transfer cards have a fee added to the amount transferred, typically between 3% and 5%, and this card charges 3% of the amount transferred or $5, whichever is greater.
Once your 0% APR promotional financing rate expires, all purchases will incur interest charges at the standard rate of 14.49%-24.49% APR. Although this card doesn’t offer a new account bonus or rewards, it does come with a few valuable cardholder benefits. It offers you a cell phone protection policy that will cover losses due to theft and damage when you pay your monthly service bill with your card. You also receive a free credit score each month and can choose your payment date. Best of all, there’s no annual fee for this card.
Runner up: Citi® Double Cash
Why it won: Here’s a card that offers both a leading balance transfer offer and competitive rewards. New accounts receive 0% APR introductory financing on balance transfers for 18 months, with a 3% balance transfer fee (or $5, whichever is greater). After the promotional rate ends, the standard interest rate of 13.99%-23.99% APR applies to new purchases and any remaining balance.
As a cash back card, the Citi Double Cash offers 1% cash back at the time of purchase and another 1% cash back when you pay for your purchases, for a total of up to 2% cash back on all purchases, with no limits. And if you also happen to hold a Citi ThankYou Premier or Prestige card, then you can transfer your rewards to Citi ThankYou points, which can be redeemed in many other ways. This card, like other Citi cards, has minimal cardholder benefits — but at least there’s no annual fee.
Best Credit Cards of 2021: Best Store Card
Why it won: Walmart is the world’s largest retailer and its reputation is based on its everyday low prices. Now, it finally has a credit card that helps shoppers achieve an even greater discount on your purchases. The Capital One Walmart Rewards® Card offers 5% cash back on purchases from Walmart.com, including pickup and delivery. It even offers you 2% cash back at Walmart stores as well as on purchases from restaurants and travel purchases, and 1% cash back elsewhere. In doing so, it becomes the rare store card that offers bonuses outside of purchases from its own stores.
To make it a bit better, during the first 12 months of account opening, new cardholders also earn 5% cash back on purchases from Walmart stores when they use the Walmart Pay app. Rewards can be given in cash back, used to pay for a purchase, or redeemed for gift cards or travel reservations. There’s no annual fee for this card, and like all Capital One cards, there are never any foreign transaction fees.
Runner up: Costco Anywhere Visa® Card by Citi
Why it won: Costco members are an extremely dedicated group due to both their low prices and their strong customer service. The Costco Anywhere Visa® Card by Citi is another way for Costco shoppers to get the most out of their membership. You earn 4% cash back on eligible gas purchases, including gas bought at Costco stores. This offer is valid for the first $7,000 spent on gas each year and then you earn 1%. This card also features 3% cash back for purchases from restaurants and on eligible travel purchase worldwide. You earn 2% cash back on all other purchases from Costco and Costco.com and 1% elsewhere. Your rewards are received once a year as a certificate that can be redeemed at Costco stores for merchandise or cash back.
This card also works to help you protect your purchases with damage and theft protection that applies to covered incidents within 120 days of purchase (90 days for New York residents). And you’ll receive an extended warranty policy that adds two years to your manufacture’s warranty. There’s no annual fee for this card with your paid Costco membership.
Best Credit Cards of 2021: Best Secured Card
Winner: Capital One Secured Mastercard®
Why it won: It can be extremely difficult to rebuild your credit once you’ve had serious credit problems. The best way to do so is to open a new line of credit and pay responsibly, yet there are very few companies that will offer loans to those with bad credit scores. And while many subprime credit cards have very high interest rates and fees, the Capital One Secured Mastercard® requires no annual fee or other fees to open an account.
You simply have to pay a refundable security deposit of $49, $99 or $200 in order to receive an initial credit line of $200, and you can also deposit more money before your account opens to get a higher credit line. Once your account is open, it will work just like any other credit card account. You can make purchases as normal, and you’ll receive a monthly statement that you must pay. Your security deposit is only used if you default on the account.
The Capital One Secured Mastercard is different from other cards in that you’ll automatically be considered for a higher credit line in as little as six months. It also comes with the same benefits enjoyed by other Capital One cardholders such as emergency card replacement, premier access to events and no foreign transaction fees. Plus, this is one of the few secured cards available with no foreign transaction fees. After a year of on-time payments, many cardholders are able to qualify for a standard, unsecured card and receive a refund of their deposit.
Runner up: Discover It® Secured Credit Card
Why it won: The Discover It Secured Credit Card is another no-fee secured card from a major card issuer that can help you rebuild credit with responsible use. This card requires a $200 minimum deposit in order to open an account, and the amount of your deposit will equal the amount of your credit line. So submitting a larger deposit will allow you to enjoy a larger credit line.
Like other secured cards, this card works just like a standard credit card and your deposit will only be used if you default on your account. However, this secured card also has a rewards program. You earn 2% cash back on purchases at gas stations and restaurants, on up to $1,000 in purchases each quarter, and unlimited 1% cash back on all other purchases. The Discover It Secured Credit Card will even match the cash back that you’ve earned on your card in your first year.
There’s no annual fee for this card, no penalty interest rate and your first late payment fee is automatically waived.
Best Credit Cards of 2021: Best 0% APR Financing Card
Winner: U.S. Bank Visa® Platinum Card
Why it won: The whole point of getting a credit card with 0% APR financing is to avoid interest charges for as long as possible. The U.S. Bank Visa® Platinum card is the best one as it currently features the longest promotional financing period available. New accounts will receive 20 billing cycles of 0% intro APR financing on both new purchases and balance transfers, with a 3% balance transfer fee (or $5, whichever is greater). The ongoing rate is 14.49%-24.49% APR on purchases and balance transfers after the intro rate expires.
Otherwise, this is a fairly simple card. It doesn’t offer a new account bonus or rewards for spending. It also has very few purchase protection and travel insurance benefits, so it certainly doesn’t compete with many of the premium rewards cards that include abundant cardholder benefits. The notable exception is that it comes with a mobile phone insurance policy that covers up to $600 in losses per claim due to theft or damage when you pay your monthly bill with the card. And thankfully, there’s no annual fee for this card.
Runner up: Wells Fargo Platinum Card
Why it won: This card features one of the longest intro 0% APR promotional offers out there, with 18 months of interest free financing on both new purchases and balance transfers, with a 3% balance transfer fee (or $5, whichever is greater). Once the introductory rate expires, the ongoing interest rate is 16.49% – 24.49% APR. Also note that this offer is restricted to those who haven’t opened a Wells Fargo credit card within the last 15 months.
The Wells Fargo Platinum Card has no annual fee, but offers few cardholder benefits like purchase protection and travel insurance. But like an increasing number of credit cards, it does include both a mobile phone insurance policy and access to your FICO credit score.
Best Credit Cards of 2021: Best Small Business Card
Winner: Spark Cash from Capital One
Why it won: The Capital One Spark Cash is considered one of the best small business credit card because it offers a very simple, and very rewarding way to earn cash back on all of your business purchases. It simply offers you 2% cash back on all purchases, with no limits and no category bonuses to worry about. You can redeem the cash back that you’ve earned at any time and in any amount, and you rewards never expire so long as your account is open.
This is also a very full featured small business credit card that includes many business friendly features such as year-end summaries, lists merchants with recurring transactions and purchase records that you can download into multiple formats including Quicken®, QuickBooks® and Excel®. And with free employee cards, you can easily extend their purchasing power while earning cash back on their spending.
Other benefits include rental car collision coverage, a travel assistance support and up to $100 in statement credits towards a Global Entry or TSA PreCheck application. All of this is well worth the $95 annual fee, which is even waived the first year.
Runner up: American Express Blue Business Plus® Credit Card
Why it won: For small business owners looking to maximize their rewards while minimizing fees, the American Express Blue Business Plus® credit card is hard to beat. You earn 2x Membership Rewards points on the first $50,000 spent in purchases each calendar year, and 1X dollar spent on all purchases after that. These Membership Rewards points can be redeemed for gift cards, merchandise and travel reservations, or transferred to points and miles with airline and hotel partners.
Business features include year end summaries, vendor pay via Bill.com and free employee cards. You can even assign an account manager to assist you with administering your account. This card also comes with 12 months of introductory 0% APR financing on new purchases, and has no annual fee. The ongoing rate is 13.24% – 19.24% APR on purchases.
Methodology: How we picked the best credit cards of 2021
To find the best credit cards, we looked at the hundreds of cards offered by all the major banks and credit unions. When it came to selecting cards for each of the 12 categories, we looked for the features and benefits that would be most valuable to credit card users looking for product in that particular category. We also weighed the value of these features against any fees charged, such as annual fees.
For example, our best 0% APR credit card had to offer the lowest promotional financing period available, but we didn’t consider rewards for this category. Likewise, we didn’t consider the interest rates, of the cards considered for the best cash back, airline and hotel rewards cards.