Staying Fit
A year after the COVID crunch led credit card issuers to cut down on deals, sweet introductory offers are back on the table. If you’re looking to grab some cash rewards or burn a balance, you need not stick with your old cards.
You can maximize rewards by using several cards and dedicating each to its best purposes. How many cards? Three or four at most. You don’t want so many that you lose track of the bills; forgetting just one payment can unleash enough penalties and interest to wipe out a year of rewards.
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And don’t even think about playing the rewards-card game if you carry a balance from month to month. Chasing after 2 percent cash back is a losing proposition if you’re paying 16 percent interest on past purchases. Instead, focus on getting your balance to zero. With that out of the way, here are some appealing cards for different types of users. (Note that offers like sign-up bonuses and balance transfer deals can change at any time.)
Everyday users
If you pay off your cards every month, use one that earns rewards, says Sara Rathner, a credit card specialist at the personal finance site NerdWallet: “Otherwise, you are leaving money on the table.” One of her current favorites? The American Express Blue Cash Preferred Card offers 6 percent cash rewards on groceries (up to $6,000 in annual spending), 3 percent on gas or transit, 6 percent on streaming services and 1 percent on everything else. The $95 annual fee is waived in the first year. You get a $350 bonus if you spend $3,000 in the first six months.
For a one-size-fits-all approach, Matt Schulz, chief credit analyst with LendingTree, recommends the Wells Fargo Active Cash Card, which has no annual fee, offers 2 percent back on all purchases and has a $200 bonus if you spend $1,000 in the first three months.
Busy travelers
I’m not a huge fan of travel rewards cards, because their point systems can be confusing and the rewards can shift as the underlying airline or hotel programs change terms. “A lot of the time, the better choice is a cash-back card,” concedes Schulz. But he carries rewards cards for the hotels and airlines he uses most, in part to get priority boarding. A good travel rewards card will also offer fee-free currency conversions on purchases made abroad.
