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Best Credit Cards in 2018

Credit cards can be an effective way to manage money, improve credit, earn points, and travel with perks if used the right way. Benzinga's personal finance staff provides tips on using credit cards effectively.

Whether you’re starting out with your first card, looking for points, building credit to prepare for a big purchase or only concerned about the best perks, there are some things you should consider before you apply for a new credit card.

How to choose the best credit card

Depending on your goals there are a few things that you should consider before moving forward.

Do you know your credit score?

Your credit score may not impact your goals for using a credit card, but it will absolutely affect which card you can get approved for.

If you do not know your credit score you can check it for free through MyFreeScore.com.

Essentially a credit score is a balance between what type of credit risk you may be, and what your credit history has been in the past. A FICO score is what credit cards issuers typically use to determine what you qualify for.

FICO Score visual breakdown

FICO’s website breaks this down into a few categories and the percentage weight given to each category:

  1. Payment history (35%) – This looks at your past credit accounts and whether or not you have made payments on time. This is accepted as the most important factor.
  2. Amounts owed (30%) – If you have a higher amount owed, it doesn’t necessarily mean you are higher risk, but it can factor into the equation.
  3. Length of credit history (15%) – Generally, the longer your length of credit history, the better, but again, this depends on the rest of your credit report as well.
  4. Credit mix (10%) – This aspect looks at the various types of credit that you have open. It could be retail cards, a home loan, a car loan, etc. Ultimately, you shouldn’t open up lines of credit that you do not intend to use.
  5. New credit (10%) – If you are to open up a few different lines of credit in a short amount of time it is viewed as a negative. If you do not have a long history of credit and you are opening multiple lines of credit if can be viewed as even riskier.

The best credit cards

Credit Card Issuer Credit Needed Best For
Platinum Card from American Express American Express Excellent/Good Travel Rewards
Chase Sapphire Preferred Credit Card Chase Bank Excellent Travel Rewards
Citi Double Cash Card Citi Excellent/Good Cash Back
BankAmericard® Credit Card Bank of America Excellent Balance Transfer
Discover it® Card for College Students Discover Limited History Students
Bank of America® Cash Rewards Bank of America Limited History Students
Capital One® Secured Mastercard® Capital One® Poor Bad Credit
Discover it® Secured Card Discover Poor Bad Credit

Travel Credit Cards

If you’re an avid traveler, a travel credit card might make the most sense for you. Ultimately, they’re a boon for travelers who want to save money on airfare, hotels, and transportation. Travel credit cards aren’t without pitfalls, however. They tend to carry a higher-than-average interest rate on purchases. Knowing that it’s important that you:

  • Don’t carry a monthly balance. If you’re interested in getting a travel credit card, it’s more important than ever to make sure you’re not letting your credit card company get rich off your inability to pay off your card each month.
  • Have a high credit score to qualify for a low APR. Since APRs are already high, a low credit score could potentially make these cards an all-around bad idea for those who aren’t doing the best, credit-score wise.
  • They often carry restrictions. With a plethora of terms and conditions, it can be a major headache to wade through blackout dates, restrictions on earning miles and more.
  • Watch the annual fees. They can get pricey. Many travel cards have them, which can ratchet them into the “forget about it” category if you’re not a frequent traveler.

However, if:

  1. You pay off your credit cards monthly,
  2. You have a decent to high credit score and
  3. You travel regularly,

Then it’s a great idea to look into Benzinga’s two highly recommended credit cards, below.

Platinum Card from American Express®

  • Annual fee: $550
  • APR: 0% intro APR on purchases and balance transfers for 12 months, then a variable APR, 14.24% to 25.24%.
  • Earn 60,000 Membership Rewards Points after you use your new card to make $5,000 in purchases in your first three months.
  • Up to $200 in Uber credits
  • 5X points on travel
  • $200 airline credit fee (in baggage fees, in-flight meals and other incidental fees charged by an airline)

In addition, you’ll also benefit from the following with the Platinum Card from American Express® :

  • Fee credit for TSA Pre✓ ®
  • Hotel perks, including room upgrades and hotel credits
  • Personalized travel planning services
  • No foreign transaction fees
  • Car rental loss and damage coverage
  • Shopping and entertainment benefits

Chase Sapphire Preferred® Credit Card

  • Annual fee: $0 intro annual fee for the first year
  • APR: 17.24%-24.24% variable APR
  • Earn 50,000 bonus points after you spend $4,000 on purchases in the first three months, and $625 toward travel when redeemed through Chase Ultimate Rewards®
  • Earn 2X points on travel and dining at restaurants
  • 25% more in travel redemption
  • 1:1 point transfer
  • Travel and purchase coverage
  • No foreign transaction fees

If you’d like to target your specific interests within travel credit cards, it’s a great idea to look specifically into airline or hotel credit cards. The two credit cards mentioned above could also apply to these particular areas, too:

Airline credit cards

Airline miles, also known as frequent flyer miles or travel points, are part of a loyalty program offered by your credit card. Naturally, if you accumulate miles based on how much you fly or spend on your credit card, you can use miles to buy airline tickets.

Hotel credit cards

If you’re more interested in earning free hotel stays and upgrades in hotels, then a hotel credit card may be more your style. Rewards are varied amongst the different cards, so it’s imperative that you do your research.

Cashback rewards

If you’re looking for a way to benefit from your credit card, you’ll enjoy the simplicity of a cents-points-miles cash back and quick turnaround of a cash back rewards card.  

Most cash back cards let you earn one to five percent on eligible purchases. There are two major benefits to a cash back rewards credit card:

  • “Getting it” isn’t hard – as in, what they offer is pretty easy to understand. Plus, the rewards are listed in dollars, so you can easily track what you’ve earned.
  • They’re easy to redeem – once you’ve earned the required balance to actually redeem the cash back reward, that is. Once you have, it’s as easy as clicking “redeem my cash” or something to that effect, depending on your card.

On the other hand, there are definitely fewer perks available if you go with a cash back credit card, and you’ll also likely have to have a good to high credit score to qualify.

Benzinga’s team of credit card experts highly recommends the Citi® Double Cash Card for this category, and here’s why:

Citi® Double Cash Card

  • Annual fee: No annual fee
  • APR: 0% for 18 months from date of first transfer for balance transfers. The standard variable APR is 14.74%, 17.74%, 20.74%, 22.74% or 24.74%, based on creditworthiness.
  • No caps on the total amount of cash back you can earn.
  • You’ll earn cash back as you pay for purchases.

Balance Transfer Credit Cards

A balance transfer, when part or all of the balance you owe is transferred from one credit card to another, is a great way to save on interest. A balance transfer credit card is the answer, especially since the transfer credit card will have a lower interest rate than the original.

Transferring high balances to a lower interest rate could save you lots of money, especially since a lot of balance transfer credit cards offer promotional offers (including interest-free time periods). This will allow you to pay off the original balance at a cheaper rate.

You’ll fill out information on the credit card application about your existing balance, and the credit card company pays off your old balance and transfers it to the new card.

Note: You’ll be charged a balance transfer fee at a small percentage of the balance you’re planning to transfer.

Benzinga’s team recommends the BankAmericard® Credit Card for balance transfers, for good reason.

BankAmericard® Credit Card

Here are the basics and a few extra details of the card:

  • Credit Needed: Excellent
  • Annual fee: No annual fee
  • APR: 0% introductory APR for the first 15 months; after that, your APR will be 13.24% to 23.24%, depending on creditworthiness.
  • APR for cash advances: 16.24% to 26.24%, based on creditworthiness.
  • Cash advance fee: Either $10 or 3% of the amount of each transaction, whichever is greater.
  • Penalty APR: None
  • Late payment fee: Up to $38

Student Credit Cards

If you’re a college student, you have a few strikes against you in the credit card department. Lack of income and lack of credit history are two major hurdles students and credit card companies must face.

In the past, a college student could get a credit card without verifiable income or even a co-signer. However, now, laws stipulate that credit card companies must verify a student’s income before allowing them to have a credit card.

Benzinga recommends these two credit cards for college students:

Discover it® Card for College Students

  • Credit Need: Limited History
  • Annual fee: No annual fee
  • APR: 10.99% intro APR for six months on balance transfers, 14.24%-23.24% standard variable APR applies.
  • Cash back rewards for good grades ($20 cash back each school year your GPA is 3.0 or higher)
  • 5% cash back rewards
  • Discover will match all the cash back you’ve earned at the end of your first year, automatically.
  • APR for cash advances: 16.24% to 26.24%, based on creditworthiness.

Bank of America® Cash Rewards

  • Credit Need: Limited History
  • Annual fee: No annual fee
  • APR: Introductory 0% APR for your first 12 billing cycles for purchases, and for any balance transfers made within 60 days of opening your account. After that, a variable APR at 14.24% to 24.24% will apply.
  • 1% cash back on every purchase
  • 2% cash back at grocery stores and wholesale clubs
  • 3% cash back on gas for the first $2,500 in combined grocery/wholesale club/gas purchases each quarter
  • $150 online cash rewards bonus offer after making at least $500in purchases in the first 90 days of opening the account.

Bad Credit

Unfortunately, a bad credit score can affect your financial freedom in more ways than one. It’s not only banks and credit card companies that are “nosy” about that seemingly fictitious number. Landlords, insurance companies, utility companies and cell phone providers are also going to be curious about your credit score and can sometimes deny services to you if your rating is low.

What actually constitutes a bad credit score? According to Experian, FICO score ranges fall into the following categories:

Credit score Rating

  • 300-579 – Very poor
  • 580-669 – Fair
  • 670-739 – Good
  • 740-799 – Very good
  • 800-850 – Exceptional

Choosing a credit card

If you’re in the 400-500 credit score range and think there’s no way you can get a credit card, think again. However, there’s nothing more important than carefully researching all of your options, because unlike people with exceptional credit scores, you can’t afford to kill your score even more.

Benzinga’s experts have teamed up to recommend two credit cards for bad credit:

Capital One® Secured Mastercard®

If you need to build or rebuild credit, the Capital One® Secured Mastercard® is a great option. Its $0 annual fee, almost–automatic credit increases (once your monthly payments are made) and built-in spending control options all spin your bad credit in a positive direction.

In addition, you’re able to watch the positive steps you’ve made by monitoring your credit profile and credit score.

Details:

  • Annual Fee: $0
  • Purchase APR: 24.99% variable
  • APR for cash advances: 24.99% variable
  • Cash advance fee: 3% (minimum $10)
  • Penalty APR: None
  • Late payment fee: Up to $35

Discover it® Secured Card

Discover it® Secured Card allows cash back rewards on every purchase with 2% cash back on restaurant or gas purchases and an unlimited 1% back on everything else. Also, you get a dollar-for-dollar match of all the cash back you’ve earned–automatically–at the end of your first year.

As you’re researching cards, you’ll notice that most secured credit cards don’t have rewards programs, so Discover it® Secured Card’s $0 annual fee, plus rewards, are icing on the cake.

Details:

Annual fee: $0

Monthly fee: $0

Purchase APR: 24.24% variable

APR for cash advances: 26.24%

Cash advance fee: Either $10 or 5% of the amount of each cash advance, whichever is greater

Penalty APR: None

Late payment fee: Up to $35

Final thoughts

Now that we’ve listed our top picks for credit cards by category, it’s also vital that you also do your own research. Whether it’s a sign-up bonus, no annual fee or rewards that really add up, it’s up to you to determine which credit card will be best for your situation.

For some, what credit card will work for you is pretty cut-and-dried. For example, if you’re a student, you’ll only be able to look at cards meant for those with little-to-no credit history (and the ones we recommended are excellent in that category). Similarly, if you’ve got bad credit, your choices are also somewhat limited.

Overall, the most important step is to pay attention to the various restrictions that may come with certain cards. Do any rewards expire? Are there limits to points you can earn?

Once you’ve answered those questions and have also reviewed Benzinga’s top recommendations, we’re confident you’ll have made an excellent decision.