With hundreds of credit cards available today, it’s difficult to find the best credit card for your particular situation. Whether you need a travel rewards card or a great cash-back card, the best offers are getting more difficult to find. The best credit cards of 2012 are just not as rewarding as they once were, but as the economy improves, credit card issuers are beginning to make a concerted effort to get your business back.

Credit cards, and in particular the type of credit card use that’s associated with maximizing rewards, is not the best option for people who do not pay the bill in full and on time each month. Be sure to read the note at the bottom of this article before changing your credit card situation.

These are the best credit cards available today, updated for May 2012. I’ve included a brief explanation as to why each credit card made the list. I update this page frequently, so check back often.

Citibank

Citi® Diamond Preferred® Card. While the Citi® Diamond Preferred® Card does not include a rewards program, there is a 0% introductory APR on purchases and balance transfers for a full 18 months. The regular APR is 11.99% – 21.99% variable, depending on credit history, and this card includes no annual fee. The Citi® Diamond Preferred® Card provides cardholders a concierge service, which can be used for just about everything, from booking hotel rooms and flights to purchasing concert tickets and making restaurant reservations.

Citi ThankYou℠ Preferred Card. The cousin of the ThankYou Premier, the Citi ThankYou℠ Preferred Card is a scaled-down version of the card with slightly smaller bonuses and rewards. If you spend $1,000 within the first three months, Citi provides cardholders with 15,000 bonus ThankYou® points, good for a $150 gift card. Customers earn five rewards points for each dollar spent on gasoline, drugstore and supermarket purchases during the first 12 months and one rewards point for each dollar spent thereafter. The Citi ThankYou℠ Preferred Card does not carry an annual fee.

American Express

Starwood Preferred Guest® Credit Card. One of the leading credit cards for travel rewards, the Starwood Preferred Guest® Credit Card offers up to 25,000 bonus points in the first six months you are a cardholder, and has no annual fee for the first year ($65 thereafter). At the recent Financial Blogger Conference, there was a significant consensus at my dinner with a number of top bloggers that the rewards offered on this card and its business counterpart are the best. And your Starpoints can be redeemed for nearly any travel expense.

Blue Cash Everyday℠ from American Express. Blue Cash Everyday℠ from American Express offers $100 cash back bonus after spending $1,000 in eligible purchases in the first 3 months, as well a cash back tier of: 3% cash back on supermarket purchases, 2% cash back on gas and department store purchases and 1% cash back on everything else. There is an introductory 0% APR on purchases for 12 months and no annual fee associated with the card. A $25 referral fee is awarded if you sign up and recommend the Blue Cash Everyday℠ from American Express to a friend.

TrueEarnings® Card from Costco and American Express. Rounding out the best American Express cards, the TrueEarnings® Card from Costco and American Express offers 3% cash back for annual gasoline purchases of up to $3,000 (1% thereafter), 2% on travel and restaurants, and 1% on everything else. The card has a low comparable APR and an introductory offer of 0% APR on purchases for six months.

Disclaimer: This content is not provided or commissioned by American Express. Opinions expressed here are author’s alone, not those of American Express, and have not been reviewed, approved or otherwise endorsed by American Express. This site may be compensated through American Express Affiliate Program.

Chase

Chase Sapphire℠ Preferred Card. The Chase Sapphire℠ Preferred Card has an introductory offer of 40,000 bonus points if you make at least $3,000 in purchases during the first three months, worth $500 toward travel rewards booked through Ultimate Rewards. This card has a 1% standard reward rate on purchases and 2% for purchases made on travel and at restaurants. There is a $95 annual fee associated with the Chase Sapphire℠ Preferred Card which is waived for the first year but cardholders will receive a 7% annual dividend on all new points earned – even on points already redeemed. For travelers, this card can really come in handy because there are no foreign transaction fees.

Chase Freedom® Visa – $100 Bonus Cash Back. The best of all cash back credit cards, the Chase Freedom® Visa – $100 Bonus Cash Back offers cardholders a $100 statement credit after making just $500 in purchases during the first three months of card ownership. This card also includes 5% cash back on up to $1,500 spent on rotating categories throughout the year and 1% cash back on everything else. Cash earned never expires and the Chase Freedom® Visa – $100 Bonus Cash Back has no annual fee.

Capital One

Capital One® Venture℠ Rewards Credit Card. The Capital One® Venture℠ Rewards Credit Card is as straightforward as it gets. Earn two miles for every dollar you spend and an additional one-time bonus of 10,000 miles when you spend $1,000 in your first three months. There is a $59 annual fee, but it is waived the first year you have the card. The Capital One® Venture℠ Rewards Credit Card is a Visa Signature card, so the card offers the Signature set of extended benefits such as complimentary concierge services and travel upgrades.

Capital One® Cash Credit Card. The Capital One® Cash Credit Card offers 1% cash back on all purchases. The card offers a 0% APR introductory offer on purchases until December 2012. The card carries a $39 annual fee and of all the cards that made this list, the Capital One® Cash Credit Card is the only one that is available for customers with average credit.

Discover

Discover® More® Card. The Discover® More® Card can be a strong cash back card if used properly. With the opportunity to earn 5% cash back on rotating categories throughout the year, up to the total purchase dollar amount specified in each program, the Discover® More® Card has been a customer hit for years. Category purchases in excess of the specified amounts will earn up to 1% cash back. In addition earn 1% unlimited cash back on purchases after your total annual purchases exceed $3,000; purchases that are part of your first $3,000 earn .25%. The card also carries a 0% APR introductory offer on balance transfers and purchases for 15 months. There is no annual fee to carry the Discover® More® Card.

Bank of America

BankAmericard Cash Rewards™ Card. The BankAmericard Cash Rewards™ Card offers 3% cash back on gas, 2% on groceries and 1% on all purchases thereafter. Cardholders have the opportunity to earn an additional 10% cash back if they redeem into a Bank of America® checking or savings account. The BankAmericard Cash Rewards™ Card does offer an introductory rate of 0% APR on purchases for the first twelve statement closing dates following the opening of the account. This card does not carry an annual fee.

Bank of America® Accelerated Rewards® American Express® Card. Two issuers combine to form this great cash back credit card, currently offering up to $50 in statement credits. The Bank of America® Accelerated Rewards® American Express® Card offers 1.25 points for every $1 in net retail purchases and does not have an annual fee. The card also carries a 0% APR introductory offer for your first 12 statement closing dates only for purchases and for balance transfers made within 60 days of opening your account. If you don’t pay your card off each month, you might discover this card’s one drawback: a purchase APR as high as 20.99%.

Simmons First

Simmons First Visa Platinum Rewards. The Simmons First Visa Platinum Rewards Card made the list because of its low standard purchase APR. At 9.25%, the only card with a lower standard purchase APR we could find was the Simmons First Visa card but that card didn’t have a rewards program. With the Simmons First Visa Platinum Rewards Card, you earn one point for every net dollar you spend, and the card carries no annual fee. If you’re planning to make a balance transfer onto this card, you’ll be happy to know there is no balance transfer fee either.

Reader favorite

Fidelity Investment Rewards Visa Signature Card. The Fidelity Investment Rewards Visa Signature Card offers a unique reward program. Earn 1.5 points for each $1 spent on the first $15,000 in purchases per year, and if you spend more than $15,000 annually that reward is increased to 2 points per $1 in purchases. When you reach 5,000 points they can be converted into deposits into your eligible Fidelity investment account. The card also participates in the WorldPoints program, so if you do not want cash back in your Fidelity account or if you don’t have an investment account, you can redeem for travel on major U.S. airlines with no blackout dates or for purchases from a selection of available merchandise.

Note: If you use credit cards as a tool for convenience, pay your bills in full every month, and are otherwise financially self-aware, consider some of these credit cards. If you use credit cards to pay for things you can’t afford, paying interest every month, then start thinking about paying off debt.

{ 38 comments }

Credit card companies tend to have some of the most pervasive marketing messages. Through frequent commercials, credit cards get their branding goals across with immediately-identifiable taglines. Discover has “it pays to Discover.” Citibank has been using “Citi never sleeps” recently. One of the most effective marketing hooks comes from Capital One, with the indelible “what’s in your wallet?” message. The ads are also memorable because they are confusing. Why, exactly, are barbarians the spokespeople for the card? Alec Baldwin signed on as a spokesperson recently, so now they offer a mixed message with barbarians on the one hand with an eloquent and cultured version of Alec Baldwin on the other.

The product in which Capital One spends the most time advertising is the Capital One® VentureOne℠ Rewards Credit Card. This card is designated one of the best travel rewards credit cards and new account holders will earn 10,000 bonus miles after spending $1,000 during the first three months, which is equivalent to earning $100 in travel rewards. Capital One also includes a 0% introductory APR for new customers on purchases until December 2012, so this card is great for making interest-free purchases, as long as the cardholder focuses on getting the entire balance paid off by the time the introductory period ends.

The Capital One VentureOne Rewards Credit Card carries a simple rewards program. Every card user earns 1.25 miles for every dollar spent, and these miles never expire. There is no maximum to the miles earned, and they can be redeemed for almost any travel expense. The standard purchase APR on the card once the introductory rate expires is 11.9% to 19.9% variable, depending on credit history. This rate, or range of rates, is also the rate for balance transfers. Although there is no low-interest introductory offer for balance transfers, the Capital One VentureOne Rewards Credit Card has no balance transfer fee, unlike most other major cards currently on the market.

In addition to the travel rewards and low APR, Capital One VentureOne Rewards Credit Card also receive the following:

• No foreign transaction fees
• No annual fees
• No blackout dates when redeeming miles

The Capital One VentureOne Rewards Credit Card is a great all around travel rewards credit card but the up-front bonus is a little light. If you have the excellent credit that this card requires, you may want to consider the Chase Sapphire® Preferred Card they offer 50,000 bonus points after you spend $3,000 in the first 3 months which is worth $625 toward travel. The rewards are similar, and Chase provides a 7% bonus on all points every year you renew the card.

{ 4 comments }