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Best Credit Cards with No Annual Fee

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Credit cards that come with an annual fee can be a burden if you find it exhausting to constantly maximize your rewards just to offset the yearly fee. 

If you’re under the impression that all credit cards without an annual fee are vanilla, you’re mistaken. Some of the top-tier credit cards that are packed with benefits are absolutely free of cost.

The best part? You’ll be able to keep your card open for a long time at no cost. This way, you can earn rewards and cash back as well as increase the average age of your accounts which can improve your credit score.

Best Credit Cards with No Annual Fee

There is a vast array of free credit cards that offer ample rewards. Benzinga’s found some of the best no annual fee cards with low rates, cash back, and rewards that are available in 2020. 

1. Best for Cashback: Citi® Double Cash Card

The Citi® Double Cash Card is great if you want to be rewarded in a way that you can understand best — dollars and cents. 

The card rewards you in 2 ways. First, you earn 1% unlimited cash back on every purchase you make. Then, as you pay for those purchases — whether it’s all at once or over time — you earn an additional 1% cash back on those credit card payments.

Unlike many other cash back credit cards, Citi Double Cash has no restricting categories to keep track of or enroll in. There are also no caps on the total amount of cash back you earn.

  • Annual fee: $0
  • Regular APR: 13.99% – 23.99%
  • Welcome bonus: No offers currently

2. Best for Travel: Wells Fargo Propel American Express® Card

The Well Fargo Propel American Express card is best for the starter traveler looking for travel benefits without paying an annual fee. 

The card offers so much value in spite of not charging an annual fee. As a welcome bonus, you get 20,000 points on spending $1,000 in purchases during the first 3 months — a $200 cash redemption value. You also earn extra rewards in a host of common spending categories — restaurants, gas stations, transit, travel, streaming and more. 

  • Annual fee: $0
  • Regular APR: 14.49% to 24.99%
  • Welcome bonus: 20,000 bonus points

3. Best for Students: Discover it® Student Cash Back

Discover it® Student Cash Back is the go-to credit for students. The card offers a $20 statement credit each school year your GPA is 3.0 or higher for up to the next 5 years.

You can earn 5% cash back on everyday purchases at different places each quarter like Amazon.com, grocery stores, restaurants, gas stations. Plus, earn unlimited 1% cash back on all other purchases.

The card also lets you automatically get an unlimited dollar-for-dollar match of all the cash back you’ve earned at the end of your 1st year.

  • Annual fee: $0
  • Regular APR: 12.99% to 21.99%
  • Welcome bonus: Cash Back Match™

4. Best for Dining and Entertainment: Savor® Rewards from Capital One®

If you spend a lot of time eating out or going out for events, it can’t get better than Savor® Rewards from Capital One®. You can earn unlimited 4% cash back on dining and entertainment, 2% at grocery stores and 1% on all other purchases. 

Prefer ordering in? The card earns you a 5% cash back if you order with Uber Eats. The card gives you privileges such as VIP experiences, discounts and on-site perks at select events.

  • Annual fee: $0
  • Regular APR: 15.99% to 24.99%
  • Welcome bonus: $300

5. Best for Rotating Categories: Discover it® Cash Back

Discover it® Cash Back earns 5% cash back on purchases you make every day at different places each quarter. Some of the categories include Amazon.com, grocery stores, restaurants and gas stations. You also earn unlimited 1% cash back on all other purchases automatically. 

The card offers an introductory offer known as Cash Back Match™. It will match all the cash back rewards you’ve earned on your credit card from the day your new account is approved and add it to your rewards account.

  • Annual fee: $0
  • Regular APR: 11.99% to 22.99%
  • Welcome bonus: Cash Back Match™

Credit Card Responsibility

Credit cards were designed to help you pay for items you need urgently over time (paying in full each month) and to help you build your creditworthiness. You can also profit from the card if you maximize the benefits that come with it.

But the misuse of credit cards is rampant in the U.S. According to the latest data from the Federal Reserve Bank of New York, credit card debt in the U.S. hit a record high of $930 billion.

Although credit cards can be beneficial, it’s no secret that it is a dangerous ground to tread. Here are some things you should know that might help you understand the dangers of owning a credit card.

Gives you the illusion of having more money

It’s easy to forget that you are actually borrowing money when you pay with a credit card. It tricks you into thinking that you have money that you don’t. This means that you don’t have a budget. 

For example, you might think that it’s just a cup of coffee or a cab ride, but over time you might realize that you were living beyond your means.

Interest leads to debt

Lenders allow you to repay a portion of what you actually owe them every month. This amount may seem less but the remaining amount accrues interest.

If you don’t pay the full amount due every month then you could end up in debt as the amount that accrued interest will get carried over to the next month.

Misuse can hurt your credit score

Your credit score is tied directly to how you use your credit card. If you don’t repay on time or run up large balances, you’ll see your credit score plummet.

A low credit score implies you aren’t financially responsible. This can affect your ability to get jobs, car loans, home loans, purchase products and more.

How to Apply for a Credit Card

You can apply for a credit card in multiple ways — online, a paper application or by phone. There are some basic requirements and information that you would need to provide in the application.

  1. Check your credit score. Most credit cards require you to have a fair to excellent credit score. If you have no or low credit, you can rebuild your credit score using a secured credit card.
  1. Choose your card. There are many kinds of credit cards. Assess your needs and lifestyle and get a card that suits you best. For example, if you live out of your suitcase, then a travel card would be perfect. 
  1. Provide personal, employment and income information. In your application form, you will have to provide personal information such as your name, address, phone number and Social Security number. You will also need to provide information about your occupation, income and sources  of income.
  1. Enter your card preferences. If you have an eligible partner or dependent who you’d like to add as an additional cardholder (or authorized user), you can include their personal details. You can also apply for a balance transfer from your existing card to your new card. 

Once you complete these steps, you can review your details and hit submit. Make sure you check your application carefully since it can’t be recalled once it’s submitted.

Is a No Annual Fee Card Right for You?

Premium credit cards typically come with a higher level of benefits compared to a card with an annual fee. You can certainly benefit from having a no annual fee credit card while you rack up rewards and take advantage of consumer protections.

Keep in mind that although a no annual credit card is free, you still might have to pay interest and other fees if you fail to repay on time or don’t pay the full amount every month. Start with our recommended cards with no fee to find the perfect fit today.

Methodology

Benzinga analyzed over 60 credit cards to determine the top 5 with no annual fees. The most important factors in determining the best credit cards are APR, annual fee and rewards. The credit card also has to report to all 3 credit bureaus.