Best No Annual Fee Credit Cards: Which Card Suits You Best?

Hi guys and welcome to the Smart Investor channel. On this video, we are going to review the best no annual fees credit cards according to our research. We will review the pros and cons of each card, compare rewards and benefits, and learn how to pick up the right card for your needs. Let's start. You have a choice to get a card with an annual fee or one with a free annual fee. You might be asking, why would you get one where you have to pay something when there is a free After all, an annual fee can range from $49 to $550 for a credit card. The annual fee will basically provide the cardholder more valuable purchase rewards and benefits than their free counterparts. A good rule to follow your annual fee decision is how often you plan to use the card. If you will be paying $49 for the card, you should earn at least $49 in rewards to break even and maybe profit from the rewards. If you plan on using the card sporadically, a no-fee card is better. Many cashback cards do not charge an annual fee. This makes them a good option as a second card or a primary card for the budget conscious. Besides the no annual fee benefit, all of the cards below offer rewards on everyday purchases. How to compare no annual fees cards Knowing how to compare no annual fee credit cards is critical for making sure you're getting the right card for your needs. Here are some of the more important features you need to consider. Intro APR Introductory APR, annual percentage rate, is often used by financial institutions to make their credit cards more appealing for new clients. A low introductory APR is a good thing since it makes owning the credit card cheaper for the first few months. However, you should remember that low introductory rates can sometimes disguise higher rates and fees after the first six months to a year. Ongoing APR The ongoing APR of your credit card reflects the real cost of the card. Many no annual fees credit cards have a comparatively high APR after the introductory rate has passed. So, it's important to compare the ongoing APR of different options to find a more affordable and valuable credit card offer. Rewards Quality Some no annual fee credit cards don't offer much in the way of a good rewards program, but there are a few cards that have solid rewards. Usually, these cards are some of the best options, but they may have very specific kinds of rewards. Look for programs that offer high cashback, fast point accrual, or that provide a significant discount at certain stores or for specific kinds of purchases. Sign-up bonus Not every credit card will offer a sign-up bonus, so it's not a requirement to find a credit card that has a good one. Sign-up bonuses are often used to disguise unfavorable APR and high fees and to get customers to sign up because of the immediate benefits. Sign-up bonuses are great when they don't hide unfavorable terms and conditions, but an overly generous signing bonus should make you look carefully at the other details of the card. Fees Almost all credit cards have some fees associated with them, but you don't want to get stuck with a card that will nickel and dime you for using it. Look for cards with low fees, especially low interest rates, low overcharge fees, and low late payment fees. Does the card accept balance transfers? Balance transfers can be an important part of money management, especially if you already have credit card debt. Relatively few credit cards accept balance transfers, especially if you're looking for low fees at the same time. You might not always need this feature, but it's important to know whether it's an option before you sign up. Source of the credit card Most people get a lot of credit card offers, but those cards usually aren't the best offer you're eligible for. Pay attention to the bank or financial institution making the offer. Likely, a banker or financial advisor will be able to choose a better credit card than a cold credit offer from a letter or mail. If you're shopping for a credit card, you are likely to be aware of the bigger brands on the market. However, one factor you may not have considered is the number of complaints for credit card issuers. Here are the smart investor selects picks for the top no annual fee credit cards. U.S. Bank Altitude The U.S. Bank Altitude Go Visa Signature Card is extremely beneficial to both new and existing customers. Cardholders can earn four times points at restaurants, takeouts and delivery, two times points at supermarkets, gas stations, and streaming services, and one point for $1 on all other purchases. These points have no expiration date and can be redeemed whenever the account is open. When you reach 2,500 points, you can either redeem them as statement credits or request that they be deposited into your account. On purchases and balance transfers, there is a 0% introductory APR for 12 billing cycles on purchases and balance transfers, followed by a variable APR ranging from 14.99% to 23.99% Finally, there are no annual fees or charges for shopping from international merchants because both are set at $0. Chase Freedom Unlimited The Chase Freedom Unlimited card provides an enthralling combination of lavish rewards, including a 5% on travel purchased through Chase Ultimate Rewards, 3% on dining at restaurants, including takeout and eligible delivery services, 3% on drugstore purchases, and 1.5% cashback on all purchases. It offers a nice signup bonus of additional 1.5% cashback on everything you buy on up to $20,000 spent in the first year, worth up to $300 cashback. Another benefit worth mentioning is the long 0% intro APR, 15 months on purchases and balance transfers, 14.99% to 23.74% variable after that. Overall, Chase Freedom Unlimited is one of the best options in the market, especially for those who are looking to save the annual fee. Capital One Saver One The Capital One Saver One cash rewards credit card is a no annual fee card that allows you to earn cashback rewards on everyday purchases. You can earn an unlimited 3% cashback on dining, entertainment, popular streaming services, and grocery store purchases, excluding superstores like Walmart and Target, 1% on all other purchases, and 8% cashback on purchases from Vivid Seats until January 2023. In addition, you are eligible for 15 months on purchases and balance transfers to help you pay down an existing balance or pay off new purchases gradually, 14.99% to 24.99% variable after that, as well as a $200 cash bonus if you spend $500 on purchases within the first 3 months of account opening. On the downside, this card requires good to excellent score and it charges a balance transfer fee of 3%. Bank of America Customized Cash Rewards If you are looking to have a bit more control over what categories in which you are going to be earning rewards, the Bank of America Customized Cash Rewards could be for you. You are able to choose the category in which you get spending rewards. You will be able to earn 3% cashback in the category of your choice, gas, online shopping, dining, travel, drugstores, or home improvements slash furnishings, 2% cashback at grocery stores and wholesale clubs, and 1% cashback on all other purchases. The 3% and 2% cashback available on the first 2,500 in combined choice category slash grocery store wholesale club purchases each quarter, then 1%. The sign-up offer allows you to get $200 cash rewards bonus after making at least $1,000 in purchases in the first 90 days of your account opening. Another great advantage of this card is that you do not have to pay an annual fee. Amex Everyday Credit Card The Amex Everyday Credit Card is a very good option among rewards cards for individuals that rank up spending at the grocery checkout and gas pump. The Everyday Card offers two times at U.S. supermarkets, up to $6,000 each year, then one time on all purchases. Terms apply. It also offers a nice welcome bonus, 10,000 points after you spend $1,000 in purchases on your new card within the first three months. Lastly, you'll enjoy 0% intro for 15 months on purchases. So if you plan a big purchase, it's another reason to consider this card. Now, besides reviewing the top cards in the category, it's important to understand how to make the smartest choice for your needs. When to consider a no annual fees card No annual fees credit cards are almost certainly the cheapest option for consumers, at least at first. They are a good option for people who are looking for an affordable credit card that doesn't cost a lot to use. You need to build credit. No annual fees credit cards are also usually a good option for people who are looking to build their credit scores. This isn't the same as trying to recover bad credit. Consumers with bad credit scores likely aren't eligible for no annual fees credit cards with other good features and terms of use. But first-time credit card users and people with moderate credit scores usually qualify for reasonable no annual fee credit cards. Your spend doesn't cover the annual fee. It's also important to think about how much you're likely to use your credit card. Consumers who are going to use their credit card a lot, especially with high balances, may be better off with a card that has annual fees compared to a no annual fee credit card. That's because high use consumers will generally make back the cost of the annual fee in higher rewards returns. However, if you need a credit card for small purchases, minimal use, or to carry as an emergency only credit card, a no annual fee credit card is likely a good option. You don't need travel rewards. No annual fee credit cards are usually best for people who aren't likely to travel very often since cards with annual fees almost always offer better travel bonuses and mileage rewards. That's it for now. Thank you for watching. On our website you can find side-by-side credit card comparisons, extensive reviews, and full guides that can help you maximize your credit rewards or build credit responsibly. What is your favorite credit card? We would love to know your thoughts so feel free to share them in the comments below. I hope you enjoyed it and don't forget to subscribe to our channel to get the best financial videos as soon as they go live.