Have you even been drawn in by a credit card’s astonishingly low interest rate or atypically generous rewards program, only to be stung by a hefty annual fee that effectively nullifies these benefits? If so, you’ll love this list of the market’s best no-fee credit cards. They are designed for everyday consumers with reasonably decent (or better) credit ratings. These cards don’t come with any annual fees, but still deliver valuable perks, rewards, or benefits. That makes them an excellent bargain in the competitive consumer credit market.
Credit card often companies attach higher interest rates and/or reduced rewards to credit cards with no annual fees. To help you avoid such offers, we’ve dug through the myriad of available options to identify the cards that deliver real benefits. These choices have favorable introductory interest rates, flexible terms and conditions, and user-friendly policies that provide real value. Here are our top five picks:
Chase Freedom Unlimited
Recommended for everyday spending, the Chase Freedom Unlimited Visa card lets you earn 3% cash back on all purchases made within the first year. Capped at $20,000, this bonus allows you to score up to $600 in direct rewards, with an additional 1.5% cash back on all purchases above that limit. You don’t need to reach any minimums to redeem your rewards, and the card comes with a 0% introductory APR.
After you’ve crossed the one-year limit, your variable interest rate will fall in the range of 17.24% to 25.99%. Balance transfers are charged at 3% of the transfer amount with a $5 minimum, which is a pretty decent mark if you’re looking to use the card to refinance existing debt.
American Express Blue Cash Everyday
This no-fee credit card carries an introductory APR of 0%, which applies to all purchases and balance transfers made within the first 15 months. Once that expires, you’ll pay a variable APR of 15.24% to 26.24%. You’ll also score a statement credit of $150 if you use the card to make $1,000 in purchases within the first three months of account activation.
Cash back is also a “thing” with this card: users get 3% on their first $6,000 per year in U.S. supermarket purchases and an additional 1% after that. You’ll also get 2% cash back at gas stations and participating American department stores, while all other purchases earn 1%. American Express made a big marketing push in 2018, enticing 1.6 million more merchants to accept their cards. That effort really enhanced this card’s utility.
Citi Rewards + Card
Citi’s Rewards + Card is branded as a MasterCard. Marketed as the only card that rounds your rewards points up to the nearest 10, the card affords you the opportunity to bank 15,000 bonus points by spending $1,000 within three months. You can redeem those points for a $150 gift card, which you can use for purchases in a wide range of categories including apparel, accessories, electronics, entertainment, home improvement, gifts, restaurants, sports equipment, health, beauty, and travel.
Another big benefit of this card: you can earn an extra 10% back on all the points you redeem in a given calendar year. The bonus applies to the first 100,000 points you tally, with supermarket and gas station purchases earning double points. Factor in the 15-month 0% APR and you’ve got one of the leading no-fee MasterCard options on the market.
U.S. Bank Cash + Visa Signature card
Looking for a no-fee Visa card? U.S. Bank has one you’ll want to consider in the Cash + Visa Signature card. This well-reviewed financial services product gives you a generous 5% cash back on your first $2,000 in qualified category purchases every financial quarter. You can grab a further 2% on all purchases in another category of your choosing. Finally, there’s an additional 1% cash back on all other spending. Best of all, there’s no limit on the amount of cash back you can earn.
New account holders can also get an extra $150 in bonus cash back. You just have to use the card to make at least $500 in purchases within 90 days of activating the account. If you’re tired of unscrupulous banks, U.S. Bank should also appeal to you. The Ethisphere Institute named the company to its World’s Most Ethical Companies list in February 2019.
Bank of America Cash Rewards MasterCard
This MasterCard-branded Bank of America Cash Rewards card delivers a nice welcome bonus of $200 if you spend $1,000 or more within your first 90 days. This online cash reward bonus supplements other appealing perks. You can get 3% cash back on all purchases in one of six preferred categories of your choice, 2% cash back from wholesalers and supermarkets, and 1% on all other purchases.
Bank of America sweetened the pot by ensuring that rewards never expire and delivering a 0% introductory APR for your first dozen billing cycles. After that, variable interest peaks at 26.24%, which is in line with market averages for no-fee credit cards. You also have a 60-day window after opening the account to enjoy 0% interest on balance transfers. After that, a modest 3% charge applies.
Other Factors to Consider
In many cases, even the very best no-fee offers hide some disadvantageous terms and conditions in the fine print. For example, cash advances may accrue interest at rates that exceed typical averages. Some companies introduce restrictive terms and conditions that limit your ability to earn or redeem rewards. While the options we’ve highlighted fall on the favorable side of the consumer balance, you should carefully review all terms and conditions before you open any new credit card account.
You’ll also notice that the variable APR rates attached to these cards regularly peak at or above 25%. If you carry a balance, those interest charges will add up very quickly. As with any credit card, the key to success is responsible, measured use within reasonable limits. Try your best to pay off your balance in full every month to maximize the card’s value advantages. And to limit how much profit the bank is making from you.