Credit Card Points and Rewards Value Compared

Credit card rewards programs allow cardholders to earn points, miles or cashback on purchases. However, the true value depends on redemption options and factors like annual fees. We analyzed over 50 popular rewards cards across banks to compare value and help consumers maximize perks.

Choosing the right card for your spending can lead to free flights, hotel stays, statement credits and more. But understanding key differences in points systems, redemption rates and fees enables extracting full value from your rewards program.

How We Compared Rewards Value

We evaluated cards across these critical factors:

Earning Rates

Higher earn rates on common spend categories mean faster points accumulation.

Redemption Value

Cents-per-point valuations based on typical redemptions like travel and cash back.

Transfer Partners

Quality of airline and hotel partners impacts flight and hotel redemption options.

Annual Fees

Lower annual fees enable cards to pay for themselves through rewards.

Perks

Additional cardholder benefits like lounge access, credits and discounts add indirect value.

Based on this criteria, we determined both equivalent redemption values across programs and the highest value options for average consumers.

Points vs. Miles vs. Cash Back Rewards

Credit card rewards programs fall into three primary categories:

Points

Programs like Chase Ultimate Rewards and American Express Membership Rewards award points that can be redeemed for various purchase erasures and travel options.

• Flexible redemptions like cash back, gift cards, flights, hotels, and more
• Point values depend on how they are redeemed
• Can transfer points to airline/hotel partners

Miles

Airline co-branded cards award miles in that airline’s program, like Delta SkyMiles and United MileagePlus miles.

• Redeem for one primary airline’s flights or partners
• Offer the best value for loyal airline customers
• Miles valuations based on redemption flight costs

Cash Back

These cards simply award statement credits equal to a percentage of spending. Most offer between 1-2% back.

• Redeem as statement credits to erase spending
• $0.01 per point value by design
• Preferred for simplicity and flexibility

While they differ, each type can provide value. We’ll explore popular examples of points, miles and cash back cards.

Top Rewards Credit Cards by Type

Here are some of the best credit cards in each major rewards category:

Points

Chase Sapphire Preferred®

• 5x on travel purchased through Chase
• 3x on dining, streaming, online groceries
• 1x on all other purchases
• Points worth ≈1.25 cents when redeemed for travel
• $95 annual fee

American Express® Gold Card

• 4x at restaurants, US supermarkets
• 3x on flights booked with airline or AmexTravel.com
• 1x on other purchases
• Points worth ≈1 cent cash back or more for travel
• $250 annual fee

Citi Premier® Card

• 3x on travel, gas stations, restaurants, groceries
• 1x on everything else
• Points worth ~0.8 cents cash back or 1 cent for travel
• $95 annual fee

Miles

Delta SkyMiles® Gold American Express Card

• 2x on Delta purchases
• 1x on everything else
• Miles worth ~1-1.2 cents each toward Delta flights
• $0 introductory annual fee the first year, $99 after that

United Explorer Card

• 2x on United Airlines purchases
• 2x on dining and hotel stays
• 1x on other purchases
• Miles worth ~1.2-1.5 cents towards United flights
• $0 introductory annual fee the first year, $95 after that

American Airlines AAdvantage MileUpSM Card

• 2x on American Airlines purchases
• 2x on grocery store purchases
• 1x on other purchases
• Miles worth ~1.2-1.4 cents towards American flights
• $0 introductory annual fee the first year, $99 after that

Cash Back

Citi® Double Cash Card

• 2% cash back – 1% when you buy, 1% when you pay
• No category bonuses
• $0 annual fee

Chase Freedom Unlimited®

• 5% cash back on travel purchased through Chase
• 3% on dining, drugstores
• 1.5% on all other purchases
• No annual fee

U.S. Bank Cash+® Visa Signature® Card

• 5% on two categories you choose
• 2% on one category
• 1% on all other eligible purchases
• No annual fee

As you can see, cards offer a range of bonus category earning structures. Next we’ll compare equivalent redemption values.

Valuing Points and Miles for Travel

Points and miles redemption values differ based on how they’re used. Here are benchmark valuations for paying for flights and hotels:

Chase Ultimate Rewards

When Chase points are transferred to airline/hotel partners, they are typically worth $0.0125 or 1.25 cents each based on average redemption costs.

For direct travel bookings via Chase’s portal, they are worth $0.015 or 1.5 cents each.

So 50,000 Ultimate Rewards points have a value around $625 for transfers or $750 for portal bookings.

American Express Membership Rewards

Amex points are generally valued at $0.01 or 1 cent each when transferring to airline partners to book award travel.

When points are used instead for statement credits or Amazon purchases, the value is $0.005 or 0.5 cents per point.

So 50,000 Membership Rewards points equate to $500 in travel redemptions or $250 in non-travel redemptions.

Citi ThankYou Points

Citi points have a baseline redemption value of $0.008 or 0.8 cents when redeemed for statement credits or gift cards.

When used to book travel via Citi, the value rises to $0.01 or 1 cent per point.

Therefore, 50,000 Citi points equal $400 when redeemed for statement credits or $500 when booking travel.

This illustrates how points values differ based on redemption choices. Next we’ll see how airline miles valuations are determined.

Valuing Airline Miles for Flights

Airline miles are valued based on average cost to redeem for flights:

Delta SkyMiles

Value around $0.012 or 1.2 cents each

50,000 miles ≈ $600 in flights

United MileagePlus

Value around $0.013 or 1.3 cents each

50,000 miles ≈ $650 in flights

American AAdvantage Miles

Value around $0.014 or 1.4 cents each

50,000 miles ≈ $700 in flights

These valuations reflect real-world averages to redeem miles based on factors like:

• Route (short-haul vs long-haul)
• Cabin (economy vs business class)
• Peak vs off-peak dates
• Airline partner award charts
• Cash price equivalents

While individual redemptions may vary, these benchmarks allow estimating an expected value from an award mile bonus.

Cash Back Value Comparison

For cash back rewards cards, the value is simple – each point is worth $0.01 as statement credits to offset purchases.

So for a card that earns:

2% cash back – $0.02 per $1 spent

5% cash back – $0.05 per $1 spent

There’s no lower value for non-travel redemptions like with points above.

Next we’ll see how signup bonuses factor in.

How Signup Bonuses Increase Value

Many cards offer large signup bonuses like 50,000 points after spending $X in the first 3 months. This immediately boosts the total value received from a card.

For example:

50,000 point bonus with $0.01 redemption value = $500

60,000 mile bonus with $0.014 redemption value = $840

Signup bonuses can offset annual fees or provide thousands in value through just one redemption.

Long-Term Rewards Value Factoring Fees

To maximize value over the long-run, cards must continue providing benefits that exceed their annual fee each year. Here are two examples:

Chase Sapphire Preferred

• $95 annual fee
• 50,000 point signup bonus worth $625 in travel
• Ongoing 2x on travel and dining rewards worth over $400 annually

Net Value Per Year: ≈ $930

Delta SkyMiles Gold Card

• $99 annual fee
• 35,000 mile signup bonus worth $350 in flights
• Ongoing 2x miles on Delta purchases worth ≈ $200 annually

Net Value Per Year: ≈ $450

As shown, signup bonus and ongoing rewards outpacing the annual fee result in strong net value. We weighed these factors in our evaluations.

Maximizing Reward Value Tips

Follow these tips to get the highest value from your card rewards:

• Prioritize cards with benefits exceeding annual fees
• Compare redemption values and transfer partners between programs
• Redeem points for highest-value options like premium travel
• Use points for purchases you’d make anyway
• Avoid letting points expire – use or transfer as needed
• Consider pooling points from co-branded cards into a Chase/Amex program for flexibility
• Verify if transfers to airline partners return outsized value over other redemptions
• Use airline miles for expensive long-haul flights and premium cabins
• Don’t hoard miles unnecessarily if lower value redemptions also have benefit

Extracting full value takes research into programs’ nuances. But choosing the right card for your habits is the first step.

Best Flexible Travel Rewards Cards

For many, cards earning flexible points that can be redeemed through a bank’s travel program or transferred to various airline/hotel partners provide the highest long-term value and convenience. Here are our recommended options in this category:

Chase Sapphire Preferred

• 5x on travel purchased through Chase
• 3x on dining, streaming, online groceries
• Points worth ≈1.25 cents when redeemed for travel
• Visa Signature benefits like rental car insurance
• $95 annual fee

Capital One Venture Rewards

• 2x miles on all purchases
• 50,000 mile signup bonus
• Miles worth 1 cent towards travel statement credits
• Application fee credit up to $100 for TSA PreCheck/Global Entry
• $95 annual fee

Citi Premier Card

• 3x on travel, gas stations, restaurants, groceries
• 60,000 point signup bonus
• Points worth 1 cent when redeemed for travel via Citi
• No foreign transaction fees
• $95 annual fee

Wells Fargo Propel American Express® Card

• 3x on dining, gas stations, transit, streaming, travel
• 30,000 point signup bonus
• Points worth 1 cent redeemed toward travel/cash back
• Cell phone protection
• $0 annual fee

Flexibility provides resilience to future program changes and award chart devaluations as well.

Best Airline Co-Branded Credit Cards

For loyal customers of a preferred airline, co-branded airline credit cards can provide great value through perks like:

• Priority boarding and free checked bags
• Discounted or companion tickets
• Complimentary lounge access
• Higher mileage earnings per dollar spent

This incremental value offsets annual fees. Our top airline card picks:

Delta SkyMiles® Gold American Express Card

• Free first checked bag – savings of $30 per flight
• Priority boarding
• 20% savings on in-flight purchases
• Up to $100 statement credit toward Global Entry/TSA PreCheck
• $0 intro annual fee the first year, $99 after that

UnitedSM Explorer Card

• Free first checked bag – savings of $30 per flight
• Priority boarding
• 2 one-time United Club lounge passes per year
• 25% discount on in-flight purchases
• Up to $100 fee credit for Global Entry/TSA PreCheck
• $0 intro annual fee the first year, $95 after that

Hilton Honors American Express Card

• Automatic Hilton Honors Silver status
• 5th night free on award stays
• Up to $100 in annual Hilton resort statement credits
• 14x points on Hilton purchases
• $0 intro annual fee the first year, $95 after that

Marriott Bonvoy Boundless® Credit Card

• 1 Free Night Award (up to 35,000 points) every year
• Automatic Silver Elite status
• 15 Elite Night credits per year toward higher status tiers
• Up to $300 annual statement credit at Marriott properties
• $95 annual fee

Remember to evaluate whether the incremental perks outweigh the annual fee for your personal travel frequency and spending patterns.

Best No Annual Fee Travel Rewards Cards

For those who want simple rewards without an annual fee, options like these offer a baseline of value:

Bank of America® Travel Rewards credit card

• 1.5x points on all purchases
• Points can be redeemed for 1 cent each toward travel
• No foreign transaction fees

PenFed Pathfinder® Rewards Visa Signature® Card

• 4x points on travel purchases
• 3x points on dining, gas stations, supermarkets
• $100 annual travel statement credits
• No annual fee

U.S. Bank Altitude® Connect Visa Signature® Card

• 4x points on travel and gas station purchases
• 2x points on grocery stores, grocery delivery, streaming services
• Intro annual fee waived the first year, $95 after that
• Up to $30 annual credits toward streaming service purchases

Wells Fargo ReflectSM Card

• 3x points on dining, gas stations, travel, transit
• Intro 0% APR for 18 months on purchases and balance transfers
• Cell phone protection when paying monthly bill with card
• No annual fee

While rewards may be lower than premium cards, avoiding annual fees enables keeping them long-term.

Best Cash Back Credit Cards

For no-fuss rewards, flat-rate cashback cards offer guaranteed value on each dollar spent:

Citi® Double Cash Card

• 2% cashback on all purchases (1% when buying, 1% when paying)
• $0 annual fee

Chase Freedom Unlimited®

• 5% cashback on travel purchased through Chase
• 3% on dining, drugstores
• 1.5% on all other purchases
• $0 annual fee

Citi Custom CashSM Card

• 5% cashback in top eligible spend category each month (up to $500 in purchases)
• 1% on all other purchases
• $0 annual fee

U.S. Bank Cash+® Visa Signature® Card

• 5% cash back in two categories you choose from a list
• 2% cash back in one everyday category
• 1% cash back on other eligible purchases
• $0 annual fee

Cash back offers pure simplicity. Just ensure your categories align with your actual highest spending.

Best Low Interest Rate Credit Cards

Minimizing interest on revolving balances can save substantially on credit card debt. Here are some top low APR card options:

Citi® Diamond Preferred® Card

• 0% APR for 21 months on balance transfers, 12 months on purchases
• Ongoing variable APR of 16.99% – 25.99%
• No annual fee
• Balance transfer fee of 5% (min $5) applies

**Amex EveryDay® Credit Card **

• 0% APR for 15 months on purchases and balance transfers
• Ongoing 12.99% – 23.99% variable APR
• No annual fee
• Balance transfer fee of 3% applies

BankAmericard® credit card

• 0% APR for 18 billing cycles on purchases and balance transfers
• Ongoing 15.24% – 25.24% variable APR
• No annual fee
• Balance transfer fee of 3% (min $10) applies

Wells Fargo Active Cash® Card

• 0% intro APR for 15 months from account opening on purchases and qualifying balance transfers
• Ongoing 14.99% to 24.99% variable APR after the intro period
• $0 annual fee
• Balance transfer fee of 3% (min $5) applies

Having a low APR card available for revolving larger purchases over time can provide savings and flexibility.

Best Student Credit Cards

Student cards help beginners build credit responsibly with sensible credit limits and training tools. Our recommendations:

Discover it® Student Cash Back

• 5% cashback in bonus categories each quarter
• 1% cashback on all other purchases
• Cashback matched after first year
• $0 annual fee

Bank of America® Cash Rewards Secured Credit Card

• 1% – 3% cash back rewards on purchases
• Requires security deposit up to $4,000
• Can graduate to unsecured card
• $0 annual fee

Capital One Journey Student Rewards

• 1% cashback on all purchases
• 0.25% increase each year for on-time payments
• Credit limits up to $5,000
• No annual fee

Deserve® EDU Mastercard for Students

• Earn 1% cash back on all purchases
• No annual fees
• No foreign transaction fees
• Cash back can be redeemed anytime
• Free credit score monitoring

Student cards help young people learn credit responsibility under parental guidance. Cost-controlled limits combined with education tools provide experience.

Closing Thoughts on Maximizing Credit Card Rewards

The value consumers receive from credit card points, miles and cash back ultimately depends on redemption opportunities and program limitations. Yet rewards can effectively erase much of your spending when chosen carefully.

Consider your normal monthly budgets and categories of expenses to select optimal bonus earning rates. Compare annual fees and incremental perks against expected earnings. And monitor award charts and transfer partners for the highest-value redemptions.

While tempting, avoid hoarding points unnecessarily. Consistently using rewards toward purchases made anyway helps offset costs. Pooling points from co-branded cards into flexible programs extends value as well.

With the right combination of signup bonuses, high earnings on major outlays, and redemptions that maximize cents per point, credit card rewards programs enable reducing out-of-pocket spending substantially. Conducting research on options most lucrative for your habits allows credit cards to functionally pay you for everyday spending.