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One of the key factors in developing a successful points and miles strategy is to make sure every dollar you spend is getting you closer to your travel goals. The choice of which card to use for bonus category purchases is pretty straightforward. But which is the best credit card to use for non-bonus category spend? Do you go for a straight cash back card offering 2% back on every purchase? Or do you go straight for a card from your preferred flexible rewards currency?
The reality is, there is no #1 best card for everyday spend because the answer is tied directly to your current travel goals. Where are you planning to go, how do you plan to get there, what are the accommodation options?
If your travel goal is to experience a luxury hotel in the Maldives, airline miles aren’t likely to be of much use (at least for the accommodation), and you’ll get more value out of transferrable points or rewards you can redeem to reimburse travel expenses. If you're only 2,000 Membership Rewards shy of a redemption you plan to complete after transferring your MR points to miles, and redeem for your dream trip, then the Amex card that earns the highest number of points for any given purchase is the best everyday spend card in your wallet.
The goal with non-bonus category spend should not be to extract every tenth of a cent out of potential value from your everyday spending, but to focus your household efforts on earning the best possible return–in a rewards currency that will help you achieve your travel goals.
Use Cards that Earn Flexible Rewards Currencies
When deciding between a flat 2% cash back card and a card that earns a maximum one point per dollar on everyday spend, the flat earning rates can be a little misleading. While earning at just one point per dollar looks the worse deal, you can transfer flexible currencies to airline and hotel partners with a specific redemption in mind and often amplify the value of your points well beyond what you receive with a cash back rewards card.
Keeping it simple, the decision of which card to use for your everyday spend can be summed up in two steps:
- Pick the rewards program that offers the best options to reach your travel goals
- Work out which of their credit cards will earn the most points on non-bonus category spend (in some cases, this will be a combination of cards).
The Best Credit Card for Everyday Spend
Each of the flexible rewards programs has either one card or a combination of cards that offer a solid return on everyday spend.
Chase offers up a few different options for earning a decent return:
- Chase Freedom Unlimited® – Earns a $150 bonus on all purchases
- Ink Business Unlimited℠ Credit Card – Earns 1.5% cash back on all purchases
Paired with …
- Chase Sapphire Reserve® – Redeem points for 1.5¢ per point for travel through Ultimate Rewards
- Chase Sapphire Preferred® Card – Redeem points for 1.25¢ per point for travel through Ultimate Rewards
- Ink Business Preferred℠ Credit Card – Redeem points for 1.25¢ per point for travel through Ultimate Rewards
The Freedom Unlimited and Ink Business Unlimited have the highest earn rate on non-bonus spending if you're collecting Ultimate Rewards, but if you pair them with any of the three cards above you can combine those rewards and redeem them as you would points earned on the higher tier card. Plus, transfer points to one of Chase's 12 transfer partners, and you can achieve much greater returns! As the Unlimited cards charge no annual fee, you're essentially adding half a point per dollar in earning capacity to your everyday spend, without adding any additional cost.
- The Amex EveryDay® Preferred Credit Card from American Express
- The Blue Business® Plus Credit Card from American Express
- American Express® Blue Business Cash Card
While the Amex EveryDay Preferred only earns one MR point per dollar spent on non-bonus category spend, if you make a minimum 30 transactions in a month you get a 50% bonus, so the card earns an effective 1.5 points per dollar if you meet the criteria. The Blue Business Plus is an Amex business card and earns 2X Membership Rewards® points on everyday business purchases such as office supplies or client dinners. The latest card to join Amex's lineup of rewards cards is the Blue Business Cash which earns a solid 2% cash back on all eligible purchases on up to $50,000 per calendar year, then 1%.
Membership Rewards are a highly flexible rewards currency and include airline partners ANA, Air France/KLM, and Singapore as transfer options. Those 30 transactions don't have to be of any specific dollar value; yes, even your daily cup of coffee counts.
The Citi Premier earns a standard 1 point per dollar on everyday spend. Points can be redeemed for 1.25¢ per point through the ThankYou Travel Center, and potentially much more when you transfer points out to Citi’s airline and hotel partners. ThankYou Rewards lags behind the other three flexible currencies in the value of its US transfer list, but they are a fantastic option for flying in the Asia/Pacific region.
Capital One is the latest bank to unveil a flexible rewards program, allowing cardmembers to transfer Venture Miles and Spark Miles to 15 airline partners. The majority of partners receive a transfer ratio of 2 points to 1.5 airline miles, with Singapore, JetBlue, and Emirates copping a 2:1 transfer ratio. In addition to adding transfer partners, Capital One has retained the ability to redeem Venture and Spark miles against any travel purchase for a fixed-value of 1¢ per piece, making these some of the most versatile points available to points and miles across any loyalty program.
The Arrival Plus earns a solid 2X miles on all purchases, and miles are worth a penny apiece when redeemed for travel expenses over $100. Cardholders also get 5% miles back every time you redeem points, so in reality, you earn 2.1 points for every dollar spent. Note that Barclaycard Miles can be redeemed against any $100+ expense that codes as travel which includes hostels, campgrounds, and airline taxes & fees, making it a fantastic card for travelers that like to get off the beaten track. The $100 minimum threshold equates to a minimum of 10,000 miles per redemption.
Best Cash Back Cards for Everyday Spend
We’ve got to give a solid mention at this point to the best cash back cards. They may not have the ability to offer higher value by transferring out to partners or give awesome travel perks, but they offer the least complicated way of earning a noteworthy return on everyday spend without needing partner cards or any specialized knowledge of points and miles.
- Citi® Double Cash Card – earns a solid 2% on all purchases, 1% on purchase, 1% on paying your account
- Capital One® Spark® Cash for Business – Earns an unlimited 2% cash back on every business purchase. Our favorite business cash back card.
If we had to choose between Membership Rewards and Chase Ultimate Rewards as the best flexible rewards currency to focus on, we’d be likely to come down on the side of UR, if only because points transfer faster in the majority of cases for UR than MR and that can make a big difference in redeeming points for your chosen award. It's worth keeping in mind, if you don’t want the added expense of the Sapphire Reserve’s $550 annual fee, you’ll still get excellent value pairing the Chase Freedom Unlimited® up with the Ink Preferred, or Sapphire Preferred as your preferred combination of cards.
As far as the best card, we are going to pin that honor on one of the latest rewards cards to join the ranks of top everyday spend cards, the The Blue Business® Plus Credit Card from American Express, which earns a solid 2X Membership Rewards points on everyday business purchases, and with no annual fee to offset has a big jump on the opposition. (Rates & Fees.)
Any cards we’ve missed off the list? Let us know in the comments which card and why it should have made the cut.
For rates and fees of the cards mentioned in this post, please visit the following links: The Blue Business® Plus Credit Card from American Express (Rates & Fees)
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