Searching for the “best” credit card is a tough task. Companies offer varied benefits and incentives to suit so many different needs. Some people prefer cash back on purchases. Some want travel rewards. Others just want protection. Plus, it’s difficult to conduct direct, across-the-board comparisons. Money Magazine and NerdWallet, a company dedicated to helping people make the best financial decisions, worked together to create this list of the best credit cards in 2016 based on different needs.
Best For Cash Back
The Citi Double Cash Card gives you 2% cash back on all purchases without limit. You get 1% as soon as you swipe and you get another 1% when you pay for those purchases—at least the monthly minimum. It’s a pretty sweet deal and even sweeter if you pay your entire balance each month, avoiding late fees or finance charges that would surmount to greater than 2%. The card also offers a 0% intro APR on balance transfers for 18 months. You have to pay a transfer fee of $5 or 3%, whichever is greater. If the 3% hit is still worth transferring the other balance, then you get a year-and-a-half interest-free to pay it off. After the initial 18 months, the rate jumps to anywhere between 13.24% – 23.24% based on your credit habits. Annual fee for the Citi Double—none.
Best For Most Cash Back
American Express Blue Cash Preferred card also puts a lot of money back in your hands. You pay $75 annually, but you get a $150 sign-up bonus if you spend $1,000 in the first 90 days. You also get 6% cash back on up to $6,000 on what you spend at supermarkets each year. (According to the USDA, a family of four on a “thrifty” meal plan spends $6,000 a year on groceries. This card would put 6% or $360 back in their pockets.) You earn 1% cash back after the $360. You also get 3% back at gas stations and certain department stores and 1% back everywhere else. As for balance transfers, the card gives you 15 months interest free, then it leaps to someplace between 13%-22%. But there’s a sticky little catch. If you transfer a balance and make purchases, interest will be charged on your purchases unless you pay your entire balance (including balance transfers) by the due date each month. Weigh that before taking advantage of the 15 months 0% APR.
Best For Travel Rewards
If you are looking to build your bank of travel miles, Chase Sapphire Preferred is a good choice. You get a 40,000 points sign-up bonus if you spend $4K in the first three months. You also get two points for every $1 you spend on travel and dining and one point per dollar on everything else. Add an authorized user and get a 5,000-point bump on his or her first purchase if it’s within 90 days. The card also gives perks like 20% off travel, but you have to use your points through Chase Ultimate Rewards. Or you can redeem points at 1¢ per mile. If you like options, you can transfer points to Sapphire’s partners for travel upgrades or booking business class seats. The annual fee is waived the first year, then $95 each subsequent year. The card carries a 16% variable APR.
Best First Card For Students
The Northwest FirstCard Visa Platinum card comes with training wheels and an air bag for first time credit card holders and those who want to establish credit. It lets you (or your son or daughter) experience the convenience of using a credit card but with little risk of huge debt and overwhelming interest payments. The FirstCard Visa Platinum allows a modest credit limit: $250 for those under 18 and $1,000 for those over 18. (If you’re over 18, you might not need a co-signer.) It’s got a fixed 12.90% APR, no annual fee and no fees on balance transfers or cash advances. Other benefits include a 25-day interest-free grace period on purchases and travel benefits including accident insurance and purchase protection. FirstCard is definitely a good first card.
Best For Student Rewards
The Discover It Chrome for Students card gives students several rewards opportunities as well as friendly benefits. Cardholders get 2% cash back on gas and restaurant purchases all year long and 1% cash back on all other purchases with a quarterly maximum. (The Discover it for Students card [not chrome] gives 5% cash back in different categories that change each quarter.) Both cards give students added bonuses. For one, Discover will match all the cash back new card members earn the first year. And if you earn a GPA of 3.0 or higher, you’ll get an additional $20 cash back! As for costs, there’s no annual fee, no fee for the first late payment and an introductory 0% APR for six months on purchases, then it jumps to 13.24% – 22.24%. There are also no foreign-transaction fees which is great news for those studying or traveling abroad.
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