Whether you’re looking for a card with a big sign-up bonus, generous rewards, or other benefits and perks, we’ve put together a list of some of the top credit cards in January 2024, as well as a guide with everything you need to know about credit cards.
You can try changing the card category, feature preferences, or credit score.
One of the first things you’ll notice when you start to research credit cards is that there are a variety of different types. The right one for you depends on several factors, including your individual needs.
One popular type of credit card is a rewards credit card, rewarding you for your spending. Some cards may offer cash back, or a certain percentage of cash back for every dollar you spend, while others may allow you to earn points or miles that you can redeem for travel purchases or purchases with certain merchants.
Many people carry multiple rewards cards with bonuses in different categories to make the most of their earnings.
Balance transfer credit cards allow you to move debt from a high-interest credit card onto a new card. These cards often have 0% interest for a certain period of time, such as 12 months, giving you time to pay off the debt without also accruing interest. While there is a fee for the balance transfer, you’ll have significant savings on interest.
If you are more likely to carry debt from month-to-month or are planning to make a big purchase, you may want to consider one of these cards. A 0% credit card offers new cardholders 0% interest on purchases, typically for at least 12 months. This gives you time to pay off your purchase without accruing interest.
Low-interest cards may charge some interest, but with a low rate you’ll save money in the long run compared to a standard rate card.
College students are likely just starting out with building credit, which can make getting a credit card more tricky. However, some cards are specifically designed for college students and take into account the fact that they are unlikely to have long credit history or high income.
There are credit cards designed specifically for people who are still building their credit or have poor credit they want to improve, and using them responsibility can help improve your score significantly.
For example, there are credit cards for fair credit scores in the range of 630-689. There are also cards for bad credit, or scores less than 630. In most cases these are secured cards, which require you to provide a cash deposit (which is refunded to you if you upgrade or close the card in good standing). There are also unsecured cards that don’t require a deposit, but they often have higher fees.
Additionally, “alternative” credit cards are designed for people with no credit or a very thin profile. Rather than relying on traditional factors of creditworthiness, these credit card companies take into account the applicant’s income, assets, and even education and employment.
Co-branded credit cards are store or brand credit cards offered through traditional credit card issuers. These may include an airline credit card so you can earn miles within a specific frequent flyer program, or hotel credit cards to earn points within a hotel loyalty program. Other co-branded cards partner with retail stores, but you can use them for other non-store purchases. These are also called “open loop” credit cards.
Typically, these rewards are limited to one brand, but the value of the rewards may be better than cash back. Some examples include:
Similar to co-branded cards, store-branded cards are offered through retail stores and consumers can use them to pay for purchases from that store. Typically, you can’t use these cards in other stores, though some allow you to use them within a specific family of stores (such as TJMaxx, Marshalls, and Home Goods). These are also referred to as “closed loop” credit cards.
These cards often have higher interest rates and are more likely to charge deferred interest, so if you’re able to repay your card in full each month, you may want to consider the perks and rewards programs these cards have to offer.
Secured credit cards are basically the same as traditional credit cards, but you must pay a cash deposit up front to guarantee your credit line. You must provide this deposit in order to access your credit. Consumers trying to establish a credit history or improve their credit scores may benefit from these cards, though they typically have lower credit limits and more fees than unsecured cards.
If you’re an entrepreneur or small business owner, a small business credit card can be a good option. Rewards and perks offered with these cards are tailored to businesses, such as free cards for employees or expense tracking tools. However, note that when you apply, your personal credit history is taken into account and your personal score can be impacted by the card’s use.
Each credit card has different benefits, features, and value depending on what you’re looking for. Some may be positive or negative, so you have to decide which are most important to you so you can make trade-offs. Understanding the main points of comparison when searching for the best card can help you choose the best one for you:
To attract new customers, credit card companies will often offer a sign up bonus or welcome offer. This offer is a one-time lump sum of cash or points, such as $200 or 50,000 miles, that you earn by spending a certain amount of money within a certain period of time after first opening the card.
In some cases, these bonuses cover the card’s annual fee, so they are worth considering.
Some credit cards charge an annual fee to cardholders solely to carry the card. You may be against paying a fee for really no reason, but some cards with annual fees have additional benefits such as:
When deciding if an annual fee is important to you, compare the value you get from the card to the fee amount you’d pay.
There are also other fees depending on what the card is and what you plan to do with it, such as:
Sometimes, credit card companies will offer people with good or excellent credit a low or 0% introductory interest rate for a certain period of time. In many cases, this is 12 months or more. There are two types of intro APRs:
Also often referred to as “regular APR,” some credit cards charge one single rate for all cardholders, while others have a range of rates depending on your credit score and creditworthiness. The better your credit, the more likely you are to qualify for a lower rate.
However, interest can be avoided completely by paying your balance in full each month.
Note that ongoing interest rates are often variable, meaning they can change under different circumstances.
Compare the rewards offered and the structure of earning. For example, do cash-back cards offer one flat rate or do they provide bonus rates for certain categories? How many points or miles do you earn per dollar spent? Comparing these cards directly can be difficult, but pay attention to things like:
Because there are different types of rewards credit cards, it can be confusing to compare and evaluate rewards rates, especially when each card can have a different reward structure for different spend categories. While calculating what you’ll earn in rewards for your spend behavior can be cumbersome, taking advantage of a cashback reward cards comparison tool can make it effortless.
Rewards are one thing, and other perks are another. Credit cards often have a variety of perks that come with having and using the card, such as:
Make sure the credit card reports payment activity to the credit bureaus so using the card responsibly reflects on your credit score. Additionally, as your credit improves, you may get access to account upgrades or other incentives.
If you’re considering applying for a secured credit card, you must take into consideration the security deposit required for opening the card. Make sure the deposit fits into your budget.
When applying for a credit card, the first step is to shop around and compare different cards. Then, you should get preapproved for your top cards. Once you’ve chosen the card for you, the next step is to apply. Not only will the company access your credit report and credit score, they will base your risk level on other information you provide.
To apply for a credit card, simply fill out an application. This is typically done online (though there are paper applications you can fill out and mail in). You’ll have to provide contact information, financial information (such as employment status and income), your birthday, and your Social Security number.
Then, the issuer will check your credit and information, and if you meet their requirements, your application will be approved. In some cases this could take as little as a few minutes. Then, within about 10 business days, you’ll receive your new card in the mail. Once you activate it, it can be used.
Like loan lenders, many credit card issuers allow you to get prequalified, or preapproved, for a credit card before you apply. While this doesn’t guarantee your application will be accepted, it can help you better understand if you’re likely to be approved in advance of applying. This does not impact your credit score.
It’s never guaranteed that you’ll be approved for a credit card, even if you have excellent credit. The best chances of getting approved are to have great credit and a good income. This means getting approved isn’t necessarily “easy,” but there are some other things to keep in mind:
With so many credit card companies, types of credit cards and options, it can feel like an overwhelming decision to make. Some details to pay particular attention to and consider include:
These days, credit cards offer so many benefits in addition to being an avenue for making purchases. However, they must be used correctly and responsibly:
Choose a credit card that offers strong rewards on the purchases you make the most. For example, if your top spending categories are gas, dining, and subscriptions, the bonus categories should offer a higher rate of rewards in those categories. Or if you travel a lot, choose a card that will allow you to earn the most points/miles possible.
Or, if you don’t have any particularly high spending categories, choose a flat-rate cash back or rewards card that offers a higher flat rate percentage.
If you have a card with rotating bonus categories, make sure you enroll or opt into those categories and use the card for spending in those categories during the correct time.
And, when you redeem points, make sure you compare redemption options to see if one is better than the other for your particular circumstances.
This depends on your needs, your spending habits, and how much you want to put into managing multiple credit cards.
For example, you may just want to carry one card and use it for all purchases. Or, you may want to have two or three cards with different rewards categories so you can earn the best rewards on all of your spending.
There’s no limit on how many cards you have, but keep in mind you must ensure you’re paying them all off and making payments on time to avoid fees and impact to your credit. Also keep in mind you don’t need to manage multiple cards to maintain a good credit score. Even carrying only one card can help your credit score as long as you make your payments on time each month.
If you do carry multiple cards, you’ll be able to:
Each credit card gives you access to a certain amount of money up to your credit limit. Having multiple cards means you have multiple credit limits, so you have access to more credit than if you just had one card. And, by spending responsibly, you can keep your credit utilization low – ideally you want it to be less than 30%.
For example, if you have a $1,000 balance on a card with a $2,500 limit, your utilization is 40%. However, if you have a $1,000 balance spread across three cards with limits of $2,500 each, your utilization is 13%.
On the other hand, with multiple credit cards it’s more difficult to remember which you’ve used and how much you’ve spent on each, and you’ll have multiple due dates which increases the likelihood of missing a payment.
There are actually different types of credit card companies and different terms associated with them. For example, each credit card has an issuer and a network, and some have co-brand partners.
The issuer is the bank that maintains your credit account, such as Chase or Capital One. They decide whether you qualify for a card based on your application and set your interest rate and fees. When you use your credit card, you’re essentially borrowing money from the issuer and then paying back the issuer when you make your monthly payments. They send you your statement each month and collect your payment.
Additionally, rewards you earn are typically paid to you by the issuer, and they may offer additional perks for being a cardholder.
The network is the go-between for credit card transactions, such as Visa, Mastercard, American Express, and Discover. The network determines where you can use your card and ensures transactions get reported to the issuer.
These companies are payment networks that process transactions, they do not actually issue credit cards. Benefits associated with your credit card comes from the card issuer, not Visa or Mastercard (the networks).
There are very few exceptions, but just about any place you make purchases takes both Visa and Mastercard. That’s why you should focus more on the individual cards vs. worrying about the network they operate on.
A co-brand partner is a store, airline, hotel, or other brand whose name appears on the card. In this case, the rewards program is tied to the card. Not all credit cards have co-brand partners, but for those that do, the partner administers the loyalty program. They may offer additional perks.
While credit cards do have interest rates, you can avoid paying interest entirely.
If you pay off your credit card balance in full each month, meaning you don’t carry any debt from month to month, you will not owe any interest. However, if you do carry debt from month to month, you’ll be charged interest:
The two most common types of rewards are:
For cards earning points/miles, there are three types:
Reward rates are set by the credit card issuer and can be a flat rate, meaning you get the same rewards rate on all spending on the card, or bonus rewards, meaning you earn a base rate on all spending and then higher rates in certain categories.
Having a credit card and using it responsibly can help you build a strong credit history and improve your credit score. They can also help you simplify payments (such as autopay using your card), finance purchases, and earn rewards.
Typically, you must be 18 to apply for a credit card, though if you’re under 21 there may be some additional requirements. There are also more options for those who are 21 and older.
It depends on the card, and while there are credit cards out there for just about any credit score, those with scores of 670 and above will qualify for the best rewards and lowest interest rates.
The “best” credit card depends on what you’re looking for and the categories you’re comparing. For example, the Chase Freedom Flex may be the best card for bonus cash back, while the Chase Sapphire Preferred is one of the best all-purpose travel rewards cards. Bank of America has some of the best balance transfer and 0% APR card options, while Delta Airlines is considered one of the best airline cards.
When you apply for a new credit card, it triggers a hard credit inquiry which will decrease your score by a few points. However, making payments on time, keeping your card balance low, and keeping a low credit utilization rate can help improve your score.
Approval for a card can take minutes, but you’ll likely have to wait up to 10 business days to receive the card in the mail.
This depends on a number of factors. While large purchases can earn you more rewards and/or help you meet a sign up bonus, you’ll also accrue more interest charges if you’re not able to pay off the balance at the end of the statement period. If you are planning a big purchase, choose a card with a 0% APR period or large sign up bonus you’ll meet with the purchase.
Some options for repaying credit card debt include using a balance transfer credit card, consolidating debt using a personal loan, or borrowing money from a friend or family member. The snowball method (paying off the smallest balance first) and the avalanche method (paying off high-interest debt first) can also be options.
There are different types of APRs, but the average APR on a new credit card is about 18%.
Visa is the most common network, making up more than 50% of cards in circulation today.
Chase has issued more cards than other institutions, with more than 149 million Chase credit cards in circulation. Capital One is the next largest issuer.