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Many consumers are angry that their hard-earned points and miles are virtually impossible to redeem for free travel. Their frustration is justified, since many loyalty programs have lately been severely devalued.
For reward credit-card users who are fed up with their travel cards, cash-back rewards offers a welcome alternative to the rules and restrictions of frequent flier programs. Here are my picks for the top five cash-back credit cards on the market today…
For those who are looking for an automatic way to add some money to their investments, Fidelity sets the gold standard with 2-percent cash-back rewards that are deposited each month into your eligible account. There’s no annual fee, and it also comes in versions that contribute to either your retirement savings or a tax-free college savings program.
This product offers 1-percent cash back on most purchases, 3 percent on gasoline and department stores, and a whopping 6 percent at grocery stores. Smart shoppers will purchase gift cards at their grocery store to extend their cash back to other merchants. Unfortunately, this card has a $75 annual fee.
This card is offered by the Pentagon Federal Credit Union, which was originally established to provide financial services to members of our armed forces and their families. With a one-time $15 donation to a military charity, anyone can join and earn 1 percent cash back on most purchases and 5 percent cash back on airfare. There’s no annual fee for this card, making it a must for employees who book company-reimbursed travel on their own cards.
This new product almost matches the standard set by Fidelity. It offers businesses and sole proprietors 2 percent cash back on all purchases, but there’s an annual fee of $59 that’s waived the first year. As with all Capital One cards, there are no foreign transaction fees.
Call it a travel card or call it a cash-back card, but it earns two “miles” in their rewards program – which are easily redeemed for statement credits toward any travel-related purchase. So long as you spend at least 2 percent of charges on any airfare, hotels, or rental car purchases, this is the same as having a cash back card.
There’s no need to endure another fight with your airline or hotel company when the award reservations you want are not available. By switching to a cash back credit card, you can enjoy impressive rewards without the rules and restrictions.