The Best Credit Cards With No Annual Fee in 2022
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Credit cards that come with annual fees are usually worth the money paid, as they come with features and benefits that make up for what you are charged yearly. However, some people prefer to get credit cards with no annual fee, which is completely understandable and valid. The good news is that even if you don’t pay an annual fee, you can still get many benefits that can be more than enough for your financial needs.
Looking at the bigger picture, you will see that some credit card issuers offer both options with slightly different perks in some cases. For example, the Blue Cash Everyday® Card from American Express has a $0 annual fee, and the Blue Cash Preferred® Card from American Express has a $95 annual fee. While the EveryDay Card offers many benefits that you can benefit from, the Blue Cash Preferred Card has higher cash back rates on gas and groceries. So, you should always weigh your options, as every person has their own needs and can decide which card works best for them.
This article will go over all the benefits and perks you can find in a no annual fee credit card and will recommend the best cards in 2022. But before going into detail on these cards, here are the most important pros and cons that you need to keep in mind before taking any step:
- It is a low-cost method to help you build up your credit and credit score: Your credit card activity will get reported to the credit bureaus every month. If you follow all the good practices on how to use your credit card, your responsible use will help you greatly build a positive credit history and maintain it on your report. Such practices include paying down your balances and monthly statements on time or in full.
- You can earn rewards and skip fees: Credit cards with no annual fee will give you many perks and rewards and not require a yearly payment in return.
- You will not have to worry about the annual fee as extra money to pay: Having a credit card with an annual fee means that you should always keep some extra money on the side to pay for your fee. With a no annual fee credit card, you can put that worry on the side for the full duration of the year.
- These cards may not have sign-up bonuses: Cards that charge an annual fee usually offer you bonuses upon signing up. However, if you pick a credit card with no annual fee, you may not get a bonus at all, or in some cases, you may get a relatively smaller one.
- Rewards and perks are not as valuable as they are with cards that do have annual fees: No annual fee credit cards typically have smaller rewards (like lower cash back rates) and fewer extra perks than those cards with annual fees. However, this does not mean that they won’t be enough for you, as you are the only one who can decide.
- The card that does not charge an annual fee may have other fees: To make sure that you do not get any unpleasant surprises at the end of the month, make sure to understand any other fees your balance will be subject to.
The simple truth is that almost everyone can benefit from credit cards that impose no annual fees. If you are thinking about getting a no annual fee credit card, think about why you need the card and how you plan to use it; this includes your spending habits, your financial priorities, your credit score, and how often you will need the card.
There are multiple instances in which a no annual fee credit card can be the perfect option for you; if you fit into any of these categories, you should go ahead and get one:
- If you are a new credit card user: If you are new to credit cards and this is your first card, then a no annual fee credit card may be the perfect choice until you gain more experience in using such cards. This way, you will not have to worry about making full use of the card’s benefits to compensate for the annual fee that you have to pay. You can start with a credit card with no annual fee until you get used to all the rewards and benefits. Once you have enough experience in how to maximize such benefits, you can upgrade to a higher-level credit card with annual fees and more valuable benefits and perks.
- If you are a credit-builder or rebuilder: If you are trying to keep your budget simple, not having an annual fee to pay will make it easier to achieve your goal; this can be very relieving for anyone working on building or rebuilding their credit score. For this purpose, many credit cards are designed for people who have no credit history or bad credit, and such cards do not charge annual fees to help people build their credit. However, some secured credit cards require a one-time security deposit.
- If you are a debt manager: Some of these no annual fee credit cards also offer a 0% introductory APR on purchases, balance transfers, or both. These cards will offer cardholders a promo period with zero interest, which cardholders can use to pay for a large purchase or make a balance transfer from a different credit account to pay their balance interest-free.
- If you are an experienced cardholder looking for a change: If you already own high-level credit cards with annual fees and want to add yet another credit card, this is your chance. You can make a credit card combination by pairing two cards; for example, you can combine a travel card and an everyday cash back card; this can help you get even more diverse benefits.
With so many credit cards on the market, it can be quite confusing to find the right one that best fits your need and financial abilities. There are a few steps that you need to follow when looking for the best credit cards with no annual fees:
Step 1: Think about your spending habits
First and foremost, you need to understand and evaluate your spending habits to decide which credit card is the most beneficial for your needs and financial abilities. Many credit cards offer extra benefits and rewards for spending in certain categories, like gas or grocery. So, knowing which categories you spend the most in will help you decide which credit card will be the best for you and which card will give you back the most.
Step 2: Compare benefits and rewards between different cards
After concluding which type of no annual fee card fits your needs, you should start comparing cards; some cards offer more benefits and higher rewards rates than others. Some cards have specific rewards designed for specific purposes. For example, you may choose to get a credit card that offers rewards in the form of cash, in the form of travel points and miles, or other forms, based on what you prefer. So before choosing and applying for a card, make sure that you know exactly what you need so that you can make the best out of your credit card.
Step 3: Decide if the rewards are enough for you
You should always keep in mind that credit cards that do charge an annual fee will typically come with better and more desirable rewards and perks. But if you still think that you do not want to pay an annual fee for any reason, then you should stick to a no annual fee credit card. But do so while fully knowing that their benefits will not be the same as those of their counterpart credit cards that charge annual fees.
The Blue Cash EveryDay® Card from American Express
With this card, you can enjoy a 0% intro APR on purchases for 15 months from the date of account opening, then a variable APR of 16.99% to 17.99% Variable. You also get $0 Buy Now, Pay Later Plan It fees on any plans that are created during the first 15 months from account opening. Any plans created after that will have a plan fee of up to 1.33% of each purchase amount (based on the plan duration, the APR that would normally apply to the purchase, and more factors).
Other rewards you can expect:
- 3% cash back on groceries at U.S. supermarkets, and U.S. gas stations, on up to $6,000 per year in purchases. After that, you get 1% cash back on eligible purchases.
Terms and conditions apply.
Chase Freedom Unlimited®
This no-annual fee credit card offers an introductory period with 0% APR for 15 months from the date of opening your account on purchases and balance transfers. After this period ends, your balance will be subject to a variable APR of 15.24% to 23.99%.
Perks and rewards include:
- You earn 5% on travel purchased through the Chase Ultimate Rewards.
- You earn 3% on dining at restaurants (including takeout and eligible delivery services).
- You earn 3% on all drugstore purchases.
- You earn 1.5% on all other purchases.
Terms and conditions apply.
Citi® Double Cash Credit Card
This no annual fee credit card offers 0% Intro APR on purchases and balance transfers for the first 18 months of account opening (all balance transfers should be completed within four months). After that, there will be a variable APR of 13.99% - 23.99%, based on your creditworthiness. You also earn 2% cash back on purchases; 1% every time you buy and 1% every time you complete any payment. To get this card, you need to have a Good to Excellent credit score (670 – 850).
Terms and conditions apply.
Capital One Quicksilver Cash Rewards Credit Card
This card has no annual fees and offers an intro 0% APR on purchases and balance transfers for the first 15 months of account opening. After that, your balance will be subject to a variable APR of 14.99% to 24.99%.
Additional perks and rewards:
- You also get a $200 bonus after you spend $500 on purchases within the first three months of account opening.
- This card has a fixed cash back rate of 1.5% on any purchase and in any category. This will be useful if you do not spend heavily on one particular category.
- You get to enjoy many other benefits, including travel rewards, 24/7 concierge assistance, extended warranty protection for qualifying purchases, and so on.
Terms and conditions apply.
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This article includes the author's opinions, reviews, and analyses alone that have not been reviewed, endorsed, or approved by any of these entities. Please note that the information regarding each card's offer is believed to be accurate as of the date it was written and as card offers change regularly; reasonable efforts are made to maintain accurate information.