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Understandably a lot of people want to avoid credit cards with annual fees. Many people make the assumption that cards with annual fees aren’t worth it. Personally I don’t agree with that sentiment, as someone who spends over $2,000 per year in credit card annual fees (yet I think I’m getting great value).
In this post I wanted to look at five of the hottest and all around most rewarding no annual fee credit cards in the market today — three of them are personal cards, and two of them are business cards.
Here are they are, in no particular order:
With airlines constantly devaluing their award charts, there’s more merit than ever before to using a cash back card for your everyday spend. This way you’re not subjected to limited award availability or confusing rewards structure, but rather get money back in your pocket for whatever you’d like.
This card offers 1% cash back when you make a purchase, and 1% cash back when you pay your bill. Getting two cents back on each dollar spent without an annual fee is fantastic.
This was the first no annual fee American Express card to accrue “real” Membership Rewards points. Not only that, but it offers a fantastic return on everyday spend. Specifically:
- Earn 2x points at U.S. supermarkets, on up to $6,000 per year in purchases
- Earn 1X points on other purchases
- Use your card 20 or more times on purchases in a billing period and get 20% more points on those purchases
So assuming you make 20 or more purchases per billing cycle, you earn 2.4x points at U.S. grocery stores, and 1.2x points on everyday purchases.
Personally I have the premium version of this card, The Amex EveryDay® Preferred Credit Card from American Express, which has a $95 annual fee and offers:
- Earn 3x points at U.S. supermarkets, on up to $6,000 per year in purchases
- Earn 2x points at U.S. gas stations
- Earn 1X points on other purchases
- Use your card 30 or more times on purchases in a billing period and get 50% more points on those purchases
I love earning 4.5x points at supermarkets, 3x points at gas stations, and 1.5x points on everyday purchases.
This card offers a flat 1.5x points per dollar spent. On the surface those points can be redeemed for one cent cash back each, meaning it’s potentially a 1.5% cash back card, which isn’t as good as the Citi® Double Cash Card. However, if you have this card in addition to one of the cards that accrues “premium” Ultimate Rewards points, you can transfer these points to Ultimate Rewards. Cards that accrue “premium” Ultimate Rewards Cards include the:
1.5x Ultimate Rewards points per dollar spent on everyday purchases is fantastic.
The Ink Business Cash offers huge bonus categories for a no annual fee card:
- 5x points on the first $25,000 spent in combined purchases at office supply stores, and on cellular phone, landline, internet, and cable TV services, for each account anniversary year
- 2x points on the first $25,000 spent in combined purchases at gas stations and restaurants for each account anniversary year
Much like the Freedom Unlimited, on the surface points earned on this card can each be redeemed for one cent cash back. However, in conjunction with a card accruing “premium” Ultimate Rewards points, those can be converted into Ultimate Rewards points.
One of the main things that makes this card so compelling is that it has a very generous sign-up bonus, that can earn you an incremental 64,600 Membership Rewards points, as I explained in a previous post. The card offers the following bonus:
- 10,000 bonus Membership Rewards points after making your first purchase on the card within the first three months
- 10x points at U.S. restaurants on the first $2,000 in purchases for the first six months
- 2x points on all qualifying purchases on the first $50,000 for the first year (an additional one point per dollar spent)
However, the benefit that most sets this card apart long term is that it offers an annual 30% bonus on base points. That means the card essentially earns 1.3x Membership Rewards points per dollar spent, which is excellent for a no annual fee business card.
You don’t have to pay a big annual fee — or any annual fee at all — to get big rewards for your credit card spend. From 2% cash back to up to 5x points on purchases, there are many no annual fee cards that offer big rewards. The above five are among my favorites.