Best Rewards Credit Cards for December 2022

With all the great offers available, a rewards card is practically a must-have. If you're trying to find one, read on -- we've sorted through hundreds of options to pick the best rewards credit cards. While we considered a few factors, the most important were the cards' rewards rates, bonus opportunities, and fees.

We're rewards card enthusiasts, so we've tried out many of our top picks firsthand. On our list, you'll find quality options for every situation, whether your priority is earning a huge welcome bonus, collecting cash back on everyday expenses, or scoring flexible travel points.

A rewards credit card earns cash back, points, miles, or some other type of reward for purchases. The amount you earn depends on the card and, in some cases, the spending category. For example, there are cards that offer a flat rate of 2% on purchases. Others offer higher rates in some categories, such as 3% on groceries.

Every eligible purchase adds to your reward balance. So, if you spend $100 on a card offering 2% cash back, you'd earn $2 in rewards. You can redeem rewards when you have enough to meet the redemption minimum, if there is one. Fortunately, many of the best rewards credit cards don't have a minimum, so you can redeem rewards anytime.

There are three types of rewards cards: travel rewards credit cards, cash back credit cards, and store credit cards.

That's simple enough, but there is one confusing part we should mention before getting into each type of rewards card. Some rewards cards technically fall into multiple categories -- but there's usually a single category that best fits each card.

The Chase Sapphire Preferred® Card is a popular example. It earns points you can use for travel, cash back, or store gift cards, so it could fit into any of the three types of rewards cards. However, its points are worth the most when you use them for travel, and it earns bonus rewards on travel purchases. For those reasons, we consider it a travel credit card.

Travel rewards credit cards

If traveling is one of your favorite things, travel credit cards are basically made for you. These cards earn rewards that you can use to cover travel purchases like airfare or hotel stays.

Travel cards are the most complicated type of rewards card. That's mainly because the way you can use travel rewards depends on the card. Here are a few examples:

• Airline credit cards earn frequent flyer miles. You can redeem miles with the airline for free flights.
• Hotel credit cards earn points in a hotel loyalty program. You can use points to book stays with that hotel chain.
• Some travel cards, including most no annual fee travel cards, let you redeem rewards at a fixed cash rate, such as $0.01 per point, towards travel purchases.

There are also some cards in popular rewards programs that offer transferable rewards. That means you can transfer your rewards to any partners in the card issuer's rewards program. These programs also usually let you redeem rewards at a fixed rate. Here are the top travel rewards programs that give you these options:

• American Express Membership Rewards
• Capital One Venture Rewards
• Chase Ultimate Rewards
• Citi ThankYou Rewards

COMPARE PICKS: Best Travel Rewards Credit Cards

Cash back credit cards

Cash back credit cards are as straightforward as it gets, and that's a big part of why they're so popular. When you use your card for a purchase, you get cash back. That could be 1%, 2%, or even 5% or more for purchases in a bonus category.

Wondering what you can do with this cash back? Almost all cash back cards let you put your rewards towards your credit card bill as a statement credit. With $100 in cash back, you could cut your credit card bill by $100. The one important thing to know here is that cash back typically isn't considered a substitute for your minimum payment. If there's a balance left, you still need to pay at least the minimum due.

Many cash back cards also let you deposit your cash into your bank account by direct deposit or request a check in the mail.

COMPARE PICKS: Best Cash Back Credit Cards

Store credit cards

Store credit cards are the one type of rewards card I don't recommend for most people. A cash back or travel card is usually a much better deal. But store cards are everywhere, and some have their uses if you shop at the store often, so it's worth knowing how they work.

Most store cards earn rewards you can redeem with that store for a gift card. There are exceptions, like the Costco Anywhere Visa® Card by Citi, which earns cash back. And some store cards offer a discount on purchases or zero-interest financing instead of rewards.

A store card can be "closed-loop" or "open-loop." Closed-loop store cards only work at that retailer and any related brands. Open-loop store cards can be used with other merchants. Some stores only offer one of the two, and others offer both options. When stores offer both, they generally approve customers with lower credit scores for closed-loop cards. Applicants with better credit can qualify for open-loop cards.

For example, let's say you apply for a T.J. Maxx credit card. Any of the following could happen:

• You're approved for the TJX Rewards® Credit Card. This is a closed-loop card, meaning you can only use it at T.J. Maxx and its other brands.
• You're approved for the TJX Rewards® Platinum Mastercard®. This is an open-loop card that can be used anywhere Mastercard is accepted.
• You're not approved for any of the T.J. Maxx credit cards.

LEARN MORE: Best Store Credit Cards

For a lot of people, the best credit card for rewards is the Wells Fargo Active Cash® Card. It earns an unlimited 2% cash rewards on purchases and charges no annual fee. In addition, it offers a generous welcome bonus and a 0% intro APR.

The biggest reason we recommend this Wells Fargo card is its cash back rate. No matter what your spending habits are, you earn competitive cash back on all your payments. In fact, an unlimited 2% cash rewards rate is the best we've seen.

There's no single card that's the best rewards credit card for everyone. That's why we always suggest comparing your options to find the one that's best for you. Your best rewards card could be one with bonus categories that fit your spending to a T, or a travel card that helps you cover expensive airfare. With the right fit, you can maximize your credit card rewards.

Learn more on how to pick the best rewards credit card in the video below. If you're ready to get started, here's how to apply for a credit card.

After earning credit card rewards, you can redeem them through the card's rewards program. The ways you can redeem them depend on the card. Here are the most common redemption options for credit card rewards:

• Get cash back, as a statement credit on your credit card bill, a direct deposit to a bank account, or as a check.
• Use them for travel through the card issuer's travel portal, as a statement credit toward previous travel purchases, or by transferring them to airline or hotel loyalty programs.
• Redeem them for store gift cards.
• Redeem them for products or services.

When you log in to your online account, there should be a clear option to redeem rewards. Choose this to see what your redemption options are and pick the one you want.

Check how much value you get with each redemption method. People sometimes assume they get the same value no matter how they use their rewards. This is a common mistake that can cost you money. The value often depends on how you use your rewards. For example, if your card earns travel points, you may also be able to redeem them for cash back, but at a much lower rate per point.

You should get a rewards credit card if you have a good credit score and will pay the bill in full every month.

Rewards cards are usually a great choice. You're going to pay for purchases anyway. Why not use a rewards card to get something back on that money you're spending? There are only a couple of situations where a rewards credit card isn't the right fit:

• You don't have a good credit score: Learn how to increase your credit score and work on that first. It usually takes a FICO® Score of at least 670 to get any of the best rewards credit cards. By improving your credit, you can qualify for rewards cards that offer much more value.
• You won't pay in full every month: Every month you carry a balance, the card issuer can charge you credit card interest. The cost of interest almost always outweighs your rewards.

Here are the pros and cons of having a rewards credit card:

Your financial situation may call for a different type of credit card. Here are a few common situations where a rewards credit card isn't the right choice, along with what type of card to pick instead.

If you won't be able to pay in full, get a credit card with a 0% intro APR on purchases. The credit card company won't charge you interest during your card's introductory period. On a card with a 15-month 0% intro APR, that means no interest charges for the first 15 months.

CHECK OUT THE LONGEST OFFERS: Best 0% APR Credit Cards

If you're working on your credit score, find a card aimed at people in your score range. First, learn about how to find out your credit score. Every credit score falls into a range, like "fair credit" or "bad credit." Once you know your score, you can pick a card you're likely to qualify for.

FIND THE RIGHT CARD FOR YOUR CREDIT SCORE:

• Best Credit Cards for Bad Credit
• Best Credit Cards for Fair/Average Credit
• Best Starter Credit Cards for No Credit

If you're dealing with credit card debt, go with a balance transfer credit card. These cards have a 0% intro APR on balance transfers (balances you move over from other credit cards). Although a balance transfer fee applies, you can still save quite a bit on interest this way. If you're unfamiliar with this type of offer, our complete guide to balance transfers explains everything you need to know.

SAVE ON DEBT: Best Balance Transfer Credit Cards

LOVE REWARDS? Check out The Ascent's MyPoints Review, where you can learn about the rewards program from MyPoints.