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Which Rewards Credit Cards Give The Most Value – A Guide

Which Rewards Credit Cards Give The Most Value – A Guide

By Dan Green

Growella researched hundreds of rewards credit cards, built an algorithm, then ranked the most popular card by their pay-outs to consumers. Use our research to find the most valuable rewards credit card for how you live your life.

What Is A Credit Card?

The way that humans “buy things” has changed over time.

In the first economies, people met in public marketplaces to exchange goods. A person with a bag of spices might be in search of fruit. Another person, holding a bag of fruit, might in search of spices.

The two would meet, exchange their goods in a transaction known as a barter , and each would return home.

The barter system requires two people to have something the other person needs. It’s an inefficient way to trade, which led to the creation of currency .

Currency is something of known value which can be traded for goods and for services. Paper money and coins are common examples of currency. A $10 bill, for example, is worth ten dollars.

With currency, buyers can bring money to a marketplace to buy fruit instead of having to bring spices, or some other item for trade.

But, currency can be limiting. You can only spend what’s in your wallet; and, it’s easy to lose or misplace your cash. These are just two of the reasons behind the invention ofcredit cards .

Credit cards are cash substitutes. They make it possible to buy things without an immediate exchange of goods or money. A buyer can show up in a marketplace with nothing but a credit card, and walk away with that fruit.

When you use your credit cards, you’re buying something today with a promise to pay for it in the future.

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Banks Compete To Get In Your Wallet

There are more than 1.5 billion credit cards in circulation today and the typical Millennial consumer carries more than one.

Credit cards are often wallet-sized and made from plastic or metal. However, the physical composition of a credit card is mostly irrelevant anymore. This is because you don’t need your credit card when you make a credit card purchase.

Consider when you buy from Amazon, Blue Apron, or some other online store.

You don’t give your actual credit card when you buy from a store online. Instead, you type your credit card account number in an order form, along with a security code and an expiration date.

And, when you buy something in a store using Apple Pay or Android Pay , you actually do even less — all that information gets shared with just a waive of your phone.

Those pieces of information — your credit card account numbers, your security codes, and your expiration dates — are what links your credit cards to your buying power. And you get to choose which card you use for each thing you choose to buy.

This is where things can get interesting.

Credit card companies can’t make money unless people use their cards. So, over the last few decades, they’ve been honing credit cards rewards programs which reward consumers for using their credit cards.

Credit card rewards program give actual rewards to consumers.

Some credit cards give cash discounts on everything you buy, which works like an automatic coupon applied to your entire shopping cart.

Other credit cards give free airline tickets, waive baggage fees, and give automatic “status” for hotel stays.

Overall, there are more than 500 rewards credit cards from which to choose, offered by companies including Capital One, Chase, American Express, Discover, Citi, Bank of America, Wells Fargo, and Barclays; as well as from smaller, local banks and credit unions.

A lot of consumers treat rewards credit cards as free money. If they’re going to spend money on their credit card anyway, they think, it’s smart to get a bonus for it.

Determining which rewards credit card will be best for you, though, can be confusing. With so many available cards — and so many possible rewards! — finding the rewards credit card that yields the highest return requires research, data, patience, and tenacity.

We set out to find the answer, then: which rewards credit card gives the most overall value.

What follows is what we learned.

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The Growella “Highest Value Credit Card” Methodology

To find which reward credit cards give the most value to consumers, Growella built an objective, proprietary algorithm based on the rewards offered by each credit card; the spending patterns of a typical consumer; and, a near-term time horizon of one year or three years, depending on the card’s reward offers.

None of our research was subjective, which is why this credit card review isn’t titled “Best Credit Cards To Keep In Your Wallet” or something similar. The word “best” implies opinion. There is no opinion here.

Our results are based on data and facts.

The information used in this study comes from credit card issuers directly; and, from government websites, including the U.S. Census Bureau and the Bureau of Labor Statistics.

No part of this study was sourced from a third-party credit card review website and we considered national credit card issuers, only. We did not consider credit union credit cards and credit cards issued by local banks because of their limited market.

We included credit cards that use the VISA and MasterCard payment networks; and, cards from American Express and Discover.

To find the most valuable rewards credit card, Growella focused on three important questions.

1. What is the spending pattern of a typical credit card holder?

Everyone spends money differently. Where you live and how you live affects how much of your pay check goes to rent and restaurants; and, to things such as gas, groceries, and entertainment.

The government keeps good record of such information, publishing it as part its annual Consumer Expenditures Survey.

The Consumer Expenditures Survey is published jointly by the Bureau of Labor Statistics and the U.S. Census Bureau. The report tracks money spent on housing, groceries, clothing, transportation, and health care among others.

First, Growella combined the report’s data into nine categories:

HousingFood At HomeFood Not At Home
ClothingGasTransportation
HealthcareEntertainmentOther

Next, because this study is designed to show the reward credit cards with the highest value, we made adjustments to the expense categories for consumers cannot use credit cards to make payment.

Those two categories are Housing and Transportation. You can’t pay your rent or your mortgage with a credit card; and, you can’t pay your car loan or car lease with one, either.

Note that the “Other” category was used as a catch-all category. It includes such expenses as personal care products and services, alcohol, and reading and education.

Lastly, we divided our spending data to include the 25-34 age group only. We selected this cohort because it’s most relevant to Growella’s readership.

We specifically elected to ignore the under-25 age group because the cohort includes high school, college, and trade school students as well as recent graduates, which makes the grouping too broad for our research purposes. Similarly, we feel that the 35-44 age group, because of its markedly higher income and homeownership rate, is an imperfect fit.

2. What is the value of a credit card reward program?

To determine which rewards credit card offers the most value to consumers, we standardized the currency in which rewards programs pay out, then made adjustments for the typical consumer’s annual spend.

We considered each of the five types of rewards credit cards in the study:

  1. Travel rewards credit cards
  2. Retailer rewards credit cards
  3. Gas rewards credit cards
  4. Cash back rewards credit cards
  5. General rewards credit cards

For cards that pay cash rewards as deposits into a bank account, or as rebates against credit card statements, we assigned a one-to-one value on each dollar paid.

For travel rewards credit cards, which typically pay rewards in “miles” to be used for flights; or “points” to be used for hotel stays, we assigned the industry standard value of two cents per mile or point, acknowledging that the actual value of a mile or point will vary based on airline, hotel, and general availability.

Travel rewards credit cards include credit cards sponsored by airlines and hotel chains; and, credit cards issuing points for general spending for which the highest point redemption value is linked to booking travel and vacation.

For general rewards credit cards, which typically pay rewards in points redeemable for products and services, we assigned the industry standard value of two cents per point. Again, we acknowledge that the actual value of a point will vary slightly.

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Next, we considered the bonuses offered by each rewards credit card.

Our research showed that most rewards credit cards offer sign-up bonuses which are paid as cash rebates, airline miles, or general credit card rewards points. Many also award follow-up bonuses after card holders cross specific spending thresholds; and place limits on bonuses which can be earned for certain purchase types, such as gas or groceries.

To determine the relative value and limits of these bonuses, Growella cross-referenced each credit card’s rewards schedule with the spending pattern of a typical credit card holder, aged 25-34. This step ensured that the value of each credit card’s rewards program were mapped to a “real life” person.

Lastly, related to bonuses, credit card issuers offer bonus rewards to new customers that are typically unavailable to existing and returning credit card holders. For this study, we assumed that each credit card holder was a new customer and ignored time-sensitive, seasonal bonus offers.

3. What fees are credit card holders required to pay?

Credit cards are typically free, but it’s also common for consumers to pay fees for certain credit card services, such as making currency conversions when traveling abroad; and, to pay annual fees, which are fees for having access to a card’s benefits.

Credit card fees affect a card’s value, so we accounted for them in our study. We deducted the fees charged by an issuer from each card’s overall value, which helped us determine the Highest Value in Rewards Credit Cards.

We did not make adjustments for credit cards that waive the annual fee for first-year customers, but then charge the annual fee in subsequent years. We acknowledge that some consumers will apply for credit cards like these then cancel those cards before the first annual fee can be assessed.

To account for this generally-accepted behavior, our research includes two sortable result sets:

  1. Highest Reward Credit Card Value for people who cancel cards after one year
  2. Highest Reward Credit Card Value for people who use cards for at least 3 years

It is a consumer’s right to apply for credit cards and cancel credit cards at-will. The long-term value of their rewards credit cards is affected by these choices, however. Our research accounts for this preference.

Rewards Credit Cards With The Highest Value

Growella ranked more than forty different rewards credit cards available to today’s consumers. We used algorithms, and kept our research objective and scientific. There is nothing subjective in our rankings.

Cards are ranked based on the value of their rewards programs.

Barclaycard Arrival Plus™ World Elite MasterCard®

1

Expected Value after 1 year:$871.66
Expected Value after 3 years:$1,436.98

Compare Rewards Credit Cards

Chase Sapphire Reserve

2

Expected Value after 1 year:$971.66
Expected Value after 3 years:$1,414.97

Compare Rewards Credit Cards

Capital One Venture® Rewards

3

Expected Value after 1 year:$771.66
Expected Value after 3 years:$1,396.98

Compare Rewards Credit Cards

American Express Blue Cash Preferred® Card

4

Expected Value after 1 year:$598.10
Expected Value after 3 years:$1,294.30

Compare Rewards Credit Cards

Citi ThankYou® Premier Card

5

Expected Value after 1 year:$730.74
Expected Value after 3 years:$1,252.21

Compare Rewards Credit Cards

Chase Sapphire Preferred® credit card

6

Expected Value after 1 year:$896.00
Expected Value after 3 years:$1,248.00

Compare Rewards Credit Cards

PNC Premier Traveler® Visa Signature® Credit Card

7

Expected Value after 1 year:$671.66
Expected Value after 3 years:$1,244.98

Compare Rewards Credit Cards

Discover it® Miles card

8

Expected Value after 1 year:$557.49
Expected Value after 3 years:$1,114.98

Compare Rewards Credit Cards

Citi® Double Cash Card

9

Expected Value after 1 year:$371.66
Expected Value after 3 years:$1,114.98

Compare Rewards Credit Cards

Discover it® card

10

Expected Value after 1 year:$520.32
Expected Value after 3 years:$1,040.65

Compare Rewards Credit Cards

Ranking Reward Credit Cards By Value To Cardholders

RankRewards Credit Card NameRewards Value in First YearSecond Year Rewards ValueThird Year Rewards ValueRewards Value over 3 Years 
1Barclaycard Arrival Plus™ World Elite MasterCard®$871.66$282.66$282.66$1,436.98

Apply

2Chase Sapphire Reserve$971.66$221.66$221.66$1,414.97

Apply

3Capital One Venture® Rewards$771.66$312.66$312.66$1,396.98

Apply

4American Express Blue Cash Preferred® Card$598.10$348.10$348.10$1,294.30

Apply

5Citi ThankYou® Premier Card$730.74$260.74$260.74$1,252.21

Apply

6Chase Sapphire Preferred® credit card$896.00$176.00$176.00$1,248.00

Apply

7PNC Premier Traveler® Visa Signature® Credit Card$671.66$286.66$286.66$1,244.98

Apply

8Discover it® Miles card$557.49$278.75$278.75$1,114.98

Apply

9Citi® Double Cash Card$371.66$371.66$371.66$1,114.98

Apply

10Discover It® card$520.32$260.16$260.16$1,040.65

Apply

11American Express Blue Cash Everyday® Card$446.77$296.77$296.77$1,040.31

Apply

12BankAmericard Travel Rewards®$478.75$278.75$278.75$1,036.24

Apply

13Chase Freedom® Credit Card$442.35$292.35$292.35$1,027.05

Apply

14Costco Anywhere Visa® Card By Citi$332.33$332.33$332.33$996.99

Apply

15Chase Freedom Unlimited Credit Card$428.75$278.75$278.75$986.24

Apply

16Wells Fargo Cash Wise Visa® Card$428.75$278.75$278.75$986.24

Apply

17Capital One Quicksilver® Rewards$378.75$278.75$278.75$936.24

Apply

18American Express Blue Cash® Card$311.34$311.34$311.34$934.01

Apply

19USAA Cashback Rewards Plus American Express® Card$301.91$301.91$301.91$905.73

Apply

20Fifth Third TRIO Credit Card$367.51$267.51$267.51$902.52

Apply

21Capital OneVentureOne® Rewards$432.29$232.29$232.29$896.86

Apply

22BankAmericard Cash Rewards™$364.26$264.26$264.26$892.78

Apply

23U.S. Bank Cash+™ Visa Signature® Card$295.78$295.78$295.78$887.34

Apply

24AARP® Credit Card from Chase$290.81$290.81$290.81$872.43

Apply

25Discover It® Gas and Restaurant Card$432.93$216.46$216.46$865.85

Apply

26U.S. Bank FlexPerks® Travel Rewards Visa Signature® Card$421.22$221.22$221.22$863.66

Apply

27U.S. Bank Cash 365™ American Express® Card$278.75$278.75$278.75$836.24

Apply

28USAA Preferred Cash Rewards Visa Signature® Card$278.75$278.75$278.75$836.24

Apply

29Wells Fargo Visa Signature® Card$449.65$185.83$185.83$821.31

Apply

30Wells Fargo Rewards® Card$449.65$185.83$185.83$821.31

Apply

31Citi Prestige® Card$601.94$101.94$101.94$805.81

Apply

32Wells Fargo Propel American Express® Card$259.84$259.84$259.84$779.52

Apply

33USAA Rewards™ American Express® Card$267.74$242.74$242.74$753.22

Apply

34Capital One QuicksilverOne® Rewards$239.75$239.75$239.75$719.24

Apply

35PNC CashBuilder® Visa® Credit Card$232.29$232.29$232.29$696.86

Apply

36Wells Fargo Propel 365 American Express® Card$259.84$214.84$214.84$689.52

Apply

37American Express Premier Rewards Gold Card$523.71$78.71$78.71$681.13

Apply

38U.S. Bank FlexPerks® Select+ American Express® Card$285.83$185.83$185.83$657.49

Apply

39Amazon Rewards Visa Signature Card$245.83$195.83$195.83$637.49

Apply

40USAA Rewards™ Visa Signature® Card$210.83$185.83$185.83$582.49

Apply

41U.S. Bank FlexPerks® Gold American Express® Card$184.29$184.29$184.29$552.87

Apply

42PNC Points® Visa® Credit Card$148.66$148.66$148.66$445.99

Apply

Yes, You Can Share Our Research!

Growella conducted its “Which Rewards Credit Cards Have The Highest Value” research to help Millennials make better decisions with their money. If you’ve found our research to be helpful, you are welcome to share this article online with proper attribution.

Here’s how to properly share the Growella study, “Which Rewards Credit Cards Have The Highest Value – A Guide For Millennials”:

For follow-up information and usage rights for our research, please email [email protected] We’re happy to help you do more with our data.

Written by Dan Green

Dan Green is a mortgage lending expert and the founder of Growella. Prior to Growella, Dan was a six-time, top-producing loan officer; and, ranked repeatedly among the top 1% of loan officers nationwide. Dan's home buying expertise has been in print and on TV with The Wall Street Journal, NPR, Forbes, CNBC, and others.

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