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Best Credit Cards of 2020
There are hundreds of thousands of credit cards available, and choosing the best credit card for you matters. We analyzed the credit card marketplace and compiled a list of the best credit cards of 2020. Our top picks range from credit cards that help you book travel to cards that reward you for spending.
A credit card can be a great financial asset in your wallet. Depending on your financial goals, spending habits and lifestyle, you’re probably asking yourself – what is the best credit card? There is no one-size-fits-all, perfect card for everyone because it depends on the individual’s financial situation.
You’ll first want to figure out which type of credit card is right for you when you are ready for one. You can earn hundreds of dollars a year, build your credit or enjoy travel benefits with the right card. Find your perfect credit card by exploring our top picks for the best credit cards of 2020.
Best Credit Cards of 2020
- Best for flat-rate cash back: Capital One Quicksilver Cash Rewards Credit Card
- Best for travel rewards: Capital One Venture Rewards Credit Card
- Best for sign up bonus: Chase Sapphire Preferred® Card
- Best for no annual fee: Capital One VentureOne Rewards Credit Card
- Best for common expenses: Blue Cash Preferred® Card from American Express
- Best for dining rewards: Capital One Savor Cash Rewards Credit Card
- Best for cash back in rotating categories: Discover it® Cash Back
- Best for balance transfers: Discover it® Balance Transfer
Blue Cash Preferred® Card from American Express
Who should get it
If you spend a lot on gas, groceries, or have a large family, the Blue Cash Preferred® Card from American Express is an excellent choice.
How to use it
Use this card when you’re grocery shopping and filling up your tank to maximize your earnings. You’ll earn 6% cash back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%) and 6% on select U.S. streaming subscriptions and 3% cash back at U.S. gas stations and on transit.
- Annual fee of $95
- American Express isn’t as widely accepted as cards in the Visa or Mastercard networks
- $25 minimum redemption for cash back
Why you’ll love it
The Blue Cash Preferred® Card from American Express’ extremely high-rate rewards make it the best choice for frequent shoppers or large families. It’s a credit card that makes earning cash back both fast and easy.
Compare the best credit cards of 2020
|Card||Annual Fee||Rewards Rate||Welcome Bonus|
|Best for flat-rate cash back: Capital One Quicksilver Cash Rewards Credit Card||$0||Unlimited 1.5% cash back on every purchase||One-time $200 cash bonus after you spend $500 on purchases within 3 months from account opening|
|Best for travel rewards: Capital One Venture Rewards Credit Card||$95||Unlimited 2x miles per dollar on every purchase||Earn 100,000 bonus miles when you spend $20,000 on purchases in the first 12 months from account opening, or still earn 50,000 miles if you spend $3,000 on purchases in the first 3 months|
|Best for sign up bonus: Chase Sapphire Preferred® Card||$95||2X points on travel and dining at restaurants worldwide, eligible delivery services, takeout and dining out & 1 point per dollar spent on all other purchases.||80,000 Ultimate Rewards points after you spend $4,000 on purchases in the first three months. Plus earn up to $50 in statement credits towards grocery store purchases.|
|Best for no annual fee: Capital One VentureOne Rewards Credit Card||$0||Unlimited 1.25x miles per dollar on every purchase||20,000 bonus miles once you spend $500 on purchases within the first three months|
|Best for common expenses: Blue Cash Preferred® Card from American Express||$95 ( See Rates & Fees )||6% cash back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%) and 6% on select U.S. streaming subscriptions and 3% cash back at U.S. gas stations and on transit, 1% on everything else. Terms Apply.||Earn a $250 statement credit after you spend $1,000 in purchases on your new Card within the first 3 months. Terms Apply.|
|Best for dining rewards: Capital One Savor Cash Rewards Credit Card||See Terms||Unlimited 4% cash back in entertainment and dining, 2% cash back at grocery stores and 1% on everything else; 8% cash back on tickets at Vivid Seats through May 2020||$300 cash back after you spend $3,000 on purchases within the first three months|
|Best for cash back in rotating categories: Discover it® Cash Back||See Terms||5% cash back at different places each quarter like grocery stores, restaurants, gas stations, select rideshares and online shopping, up to the quarterly maximum when you activate, 1% on everything else||Dollar-for-dollar match at the end of the first year|
|Best for balance transfers: Discover it® Balance Transfer||See Terms||5% cash back at different places each quarter like grocery stores, restaurants, gas stations, select rideshares and online shopping, up to the quarterly maximum when you activate, 1% on everything else||Discover will match ALL the cash back earned at the end of your first year, automatically.|
Capital One Quicksilver Cash Rewards Credit Card
Who should get it: The Capital One Quicksilver Cash Rewards Credit Card is for those who love simplicity, have good to excellent credit and want to earn rewards.
How to use it: You can earn unlimited 1.5% cash back on all purchases with the Capital One Quicksilver Cash Rewards Credit Card. There is no cap to the amount of rewards you can earn on purchases, and your cash back can be automatically applied as a statement credit when it reaches a specific amount ($25, $50, $100 or $200) through Capital One’s auto-redemption feature.
Why you’ll love it:
There aren’t any rotating categories to worry about, so you’ll earn 1.5% cash back no matter how you use your Capital One Quicksilver Cash Rewards Credit Card. When you earn rewards, you can redeem them for any amount at any time.
Things to consider:
- Cash back redemption is lower value than travel redemption.
- Higher earning rewards cards available.
- Good to excellent credit required for approval.
Capital One Venture Rewards Credit Card
Who should get it: Anyone looking for a fast way to earn miles will get the most out of the Capital One Venture Rewards Credit Card. It makes our top credit cards list for the simple fact that you can earn 2x miles per every dollar you spend on purchases.
How to use it: You can take this card anywhere without worrying about foreign transaction fees and earn 2x miles for every dollar. Earn 100,000 bonus miles when you spend $20,000 on purchases in the first 12 months from account opening, or still earn 50,000 miles if you spend $3,000 on purchases in the first 3 months.
Why you’ll love it:
The Capital One Venture Rewards Credit Card stands among the best credit cards for travel rewards. Being able to earn unlimited 2x miles for every dollar you spend makes saving up for a vacation fast and simple.
Things to consider:
- Annual fee of $95
- Lesser redemption value for cash back
- Requires good to excellent credit
Pro tip: Take advantage of the sign up bonus that nets you 100,000 bonus miles when you spend $20,000 on purchases in the first 12 months from account opening, or still earn 50,000 miles if you spend $3,000 on purchases in the first 3 months.
Capital One VentureOne Rewards Credit Card
Who should get it: The Capital One VentureOne Rewards Credit Card is a great first-time travel card for people who want to earn rewards and take advantage of no blackout dates and booking travel through any of Capital One’s airline or hotel partners.
How to use it: If you use the Capital One VentureOne Rewards Credit Card, you’ll earn 1.25x miles for every purchase. There’s flexibility in how you can redeem your rewards, but you’ll get the most value out of your earned miles by transferring it to one of Capital One’s travel partners.
Why you’ll love it:
The Capital One VentureOne Rewards Credit Card gives you the opportunity to earn great rewards and rack up an unlimited amount of miles that you can use to travel more frequently. An added bonus is that the rewards next expire.
Things to consider:
- Late payment fee of up to $40
- Lower reward value with cash back redemption
- Potentially high APR after intro period
Discover it® Cash Back
Who should get it: The Discover it® Cash Back is ideal for cardholders who like a little variety in their rewards categories while earning cash back, as well as a great rewards match program at the end of your first year.
How to use it: With the Discover it® Cash Back, you can earn up to 5% cash back each quarter at various, rotating categories including grocery stores, restaurants, gas stations, select rideshares and online shopping, up to the quarterly maximum when you activate. Plus, earn unlimited 1% cash back on all other purchases.
Why you’ll love it:
There’s a lot to love about a credit card like the Discover it® Cash Back. It lets you redeem your cash back rewards without any fear of those rewards expiring and you’ll automatically get a dollar-for-dollar match at the end of your first year.
Things to consider:
- Limit on how much you can earn
- Rotating bonus categories require activation
- Discover isn’t as widely accepted as cards in the Visa or Mastercard network.
Pro tip: Keep in mind that a year can be a long time to wait for that dollar-for-dollar match offered by the Discover it® Cash Back card.
Should I get a credit card?
Getting a credit card can make you feel like an adult and be financially beneficial if you use it responsibly. It’s a decision that can be an important step towards building a credit history that will eventually open the door to buying big-ticket items and being more financially responsible, but it can also have long-term consequences.
With a credit card, you’ll get access to a revolving line of credit from the card issuer. Your credit limit is determined on your creditworthiness. You can continue using the card for purchases as long as your outstanding balance stays within your credit limit.
If you’re new to credit, you might not have enough of a credit history to qualify for some of the best credit cards available. That’s where secured credit cards come into play. Unlike unsecured credit cards (regular credit cards), secured cards require a down payment. That makes them less risky for lenders and easier to apply for.
How credit cards work
A credit credit is similar to a loan, in that it offers you a line of credit that can be used to make purchases, balance transfers or cash advances. After you use it to make purchases, you are required to pay back the amount you spent. A minimum payment is typically required every month by a specific date on the balance, but it is better to pay any balance in full to avoid interest charges.
Some credit cards might have an annual fee, which the fee amount depends on the card and can vary after an introductory period. There may also be other fees associated with credit cards depending on the activity, such as cash advance fees, balance transfer fees or foreign transaction fees.
The biggest pro of having a credit card is the ability to build or improve your credit score, as it is important if you ever want to buy a car or get a mortgage loan, among other things. If you can regularly use your credit card responsibly, you can build credit and grow financially.
How to apply for a credit card
Applying for a credit card is one thing, but getting approved for one is another. It’s as simple as entering your information into an online application. However, it can require some planning and research beforehand. Knowing what credit card issuers are looking for can be useful when you’re completing your application. Here are steps to apply for a credit card:
- Check your credit score
- Determine what type of card you need
- Choose where to apply
- See if you’re pre-qualified
- Prepare for a potential impact to your credit
- Practice responsible credit card habits
When should I pay off my credit card bill?
Always strive to pay your credit card balance in full by your statement due date. There’s no better way to build a solid credit history and healthy credit score. Credit is a powerful tool when seasoned with self control, but without discipline, it can wreak havoc on your financial future. Case in point – the average American household has $16,000 of credit card debt.
If your card has an 18% interest rate and you’re only making the minimum payment (usually around 3% of the total balance), you’ll rack up over $2,000 in interest charges every month and continue to lose ground.
Paying your credit card off in full also helps to keep your credit utilization ratio low. Your credit utilization ratio is the percentage of your available credit that you have used. Credit bureaus use this metric to gauge how responsible you are. When it comes to credit utilization ratio, low is best. Credit cards can negatively affect your credit utilization if you continuously run large balances. We recommend keeping your credit utilization for each credit card below 30%.
Pro tip: You can track your credit utilization on your credit card with some simple math — your balance divided by your credit limit equals your ratio.
How credit utilization affects your credit score
There are five factors that influence your credit score: payment history, age, mix of credit, inquiries, and your credit utilization — which can impact up to 30% of your score. Credit utilization (sometimes referred to as your credit utilization ratio) represents the percentage of your available credit that is currently active.
Imagine you have two credit cards with a total credit limit of $20,000 – one with a $5,000 limit and another with a $15,000 limit. On the first card, you have a $3,200 balance, and on the second you have a zero balance because you just paid it off. Right now, your credit utilization is at a healthy 16%.
If you cancel the second card, your total credit limit will drop to $5,000 and your credit utilization will rise to a whopping 64%. That’s important to keep in mind because experts say that once your utilization ratio exceeds 30% your credit score may be at risk.
How many credit cards should you have?
The number of credit cards someone should have depends on the individual. You should never have more credit cards than you can handle. The short answer is that you should strive to have at least two credit cards – ideally from different issuers and that offers different rewards. The average American has 3.1 credit cards, according to a 2017 Experian survey.
Whether you have two or 20 cards, what’s important is that you use your cards responsibly and take full advantage of the benefits that come along. Make sure you’re not juggling so many cards that you get overwhelmed and can’t keep track of all the payment due dates. The main point of having more credit cards is earning points or cash back on your everyday spending that you pay off every month.
Please Note: Information about the Discover Credit Cards and Blue Cash Preferred® Card from American Express have been collected independently by TheSimpleDollar.com. The issuer did not provide the details, nor is it responsible for their accuracy.
For rates and fees of the Blue Cash Preferred® Card from American Express, please click here
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