Get a Great General Purpose Reward Card and Use It for All of Your Spending (2021)

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If you are following our advice, you will eventually acquire a handful of credit cards for their travel benefits—such as a card that provides free airport lounge access, an airline credit card for the airline you fly the most, and perhaps a couple of hotel credit cards.

You COULD use any of these credit cards (or another one you already have) to earn rewards on your ongoing purchases. But they probably don't offer the best rewards for your spending. Since your goal is to earn as many points as you can, it is worthwhile to sign up for an additional card—specifically chosen to earn the best possible reward rate on your everyday purchases.

GET the cards that make sense for their travel benefits; but USE the card that earns the best rewards for your spending. And use it, instead of cash or checks, whenever you can.

You'll slowly and surely earn enough points for free airplane tickets and hotel rooms. If you make the effort to use your card to pay for as many of your expenses as you can, you'll earn more free travel every year.

If You are Collecting Signup Bonuses

If you've decided to collect credit card signup bonuses, you don't need to worry about using a great rewards card—you'll want to focus your credit card spending on meeting the minimum spending requirements of new cards instead. For example, rather than earning an extra $15-30 from spending $3,000 on a better reward card, you can use that spending to earn an additional signup bonus worth at least $500.

On the rare occasions where you aren't working on earning a new bonus, just use the most rewarding card that you happen to already have. You may eventually want to get yourself a good no-annual-fee cashback card (once you're no longer under 5/24 and have completed getting your higher priority cards) to earn some additional rewards during these gaps.

However, it may be worthwhile to prepare for a day when you choose to stop collecting signup bonuses. At that point, you are likely to still be blocked from getting any new Chase cards. We recommend getting two Ultimate Rewards card while you still can (and probably more if you are getting business cards). You can choose the ones with the best signup bonuses (or other benefits) and convert them to no-annual-fee versions (if necessary). Then you'll have them ready-to-go whenever your start slowing down with new signup offers.


(Almost) never use cash—earn rewards instead

Your goal is to collect as many miles or points (or as much cash back) as you can. That means that once you choose the reward card that works best for you, you should use it whenever possible, rather than paying with cash, a debit card, or a check. Start putting everything on your cards, and your rewards will build up quickly.

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  • Every time you use cash, a check, or your bank card (when you could have used your credit card), you are missing out on reward points. Each individual transaction may not seem like much, but it adds up over time.
  • Using a credit card (instead of cash) has some other benefits as well. You’ll have better records of your spending, build up your credit history, and make fewer trips to the ATM (paying less in ATM fees). In addition, your credit card will often give you some protection if something you buy breaks, is stolen, or even drops in price. Automatic Protection for the Things You Buy with Your Credit Card.
  • While we strongly recommend using your credit card for as much of your spending as possible, you don’t have to take it to an extreme. If you are making a small purchase and paying cash will speed up the process for everyone, don’t worry about a few cents worth of points. If you are under the store’s minimum for taking credit cards, don’t make a fuss, just pay with cash.  And you usually don’t want to use your credit card with any business that will add an extra "convenience" fee.
  • Many of the bills that you pay each month can be paid with a credit card, rather than with a check or automatic bank withdrawal. For example, pretty much every wireless and cable company accepts credit card payments, as do many utilities, insurance companies, and gyms. Go back over a few months of bank statements and see who you are paying on a regular basis. Then check which of these companies you can switch over to a credit card (without any extra fees).

The best general purpose reward card (for most people)

Which general purpose reward card is best? For most people, the answer is...

You should get BOTH the Chase Sapphire Reserve Card and the Chase Freedom Unlimited Card. The two cards work together to give you fantastic reward rates on your purchases. In addition, the Sapphire Reserve Card provides a valuable set of extra travel benefits.

The Freedom Unlimited Card earns 1.5x Ultimate Rewards points on every purchase. These points are normally only worth 1 cent each towards travel purchases or gift cards.

However, if you also have the Chase Sapphire Reserve Card, you can get 1.5 cents each. This gives you a "cash" rewards rate of 2.25 cents per dollar, higher than most cashback cards.

But it gets better. Ultimate Rewards points can be converted into a number of different types of airline miles and hotel points, which can then be redeemed for frequent flyer tickets or free hotel nights. For example, you can convert your Ultimate Rewards points to Hyatt points to book a free hotel night night or to United miles to book a frequent flyer ticket.

At a "base value" of 1.7 cents per point, the effective earning rate is 2.55 cents per dollar and you can get even more value with particularly good hotel and frequent flyer award redemptions.

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  • For most people, earning Chase Ultimate Rewards points is a better option than earning other types of credit card rewards. Not all points are equal—some points are worth more than others. Introduction to 'Transferable' Reward Points.
    • Unlike Amex's Membership Rewards points and Citibank's ThankYou points, you can get good value from your Ultimate Rewards points without hassling with frequent flyer miles. Truth be told, it is getting increasingly difficult to find frequent flyer award space and get good value from your miles. Fortunately, Chase points can be used in much easier ways. More than likely, you'll use most of your points for hotel stays through Hyatt. Using points for hotel stays is easy. Unlike frequent flyer miles, you don't need to find limited award space—if a standard room is available, you can book it with points. Since Hyatt doesn't charge (significantly) more points when hotel prices are more expensive than normal, you can usually get more than 1.7 cents per point in value and sometimes more than 2-3 cents per point. And because award nights use far fewer points than frequent flyer tickets, you can reward yourself more frequently.
    • You can always use Ultimate Rewards points (at a fixed value of 1.5 cents each) to offset grocery store, home improvement store and restaurant purchases on your credit card bill, or make any travel purchase through the Chase website.

    • But unlike the cash-like points you can earn from some other credit cards, you still retain the upside of getting much more value from your reward points. When you find an opportunity to use your Ultimate Rewards points for frequent flyer tickets or to make a particularly valuable hotel redemption, they can be worth 2-5 cents per point (3-7.5% per dollar) or even more.
    • Accumulating Ultimate Rewards points lets you get your feet wet with potentially high-value hotel and frequent flyer redemptions, while still providing a way to simply "cash-out" your points. In the worst case, spending with the combo will earn 2.25% back in travel purchases through Chase—which is better than most cards but slightly lower than you might be able to get from the very best cashback options. We think it is worth the slightly lower "floor" to get the potentially valuable upside from frequent flyer tickets or Hyatt hotel stays.
  • You'll earns 3x Ultimate Rewards points (valued at 5.1 cents per dollar) on restaurant spending made with either card.
  • You'll earns at least 3x Ultimate Rewards points (valued at 5.1 cents per dollar) on travel spending with the Sapphire Reserve. If you are willing to purchase airfare through Chase, instead of directly with the airline, you'll boost your rewards to 5x Ultimate Rewards points (valued at 8.5 to 17 cents per dollar). In the rare cases where you can get a good deal on a hotel or rental car through Chase, you can earn 10x points.
  • You’ll start out with 50,000 points from the Sapphire Reserve Card, plus 15,000 points from the Freedom Unlimited Card (with the standard offers). 65,000 Ultimate Rewards points can be used like $975 in cash, but you'll probably get more value when you use it for a free flight to Europe, 2.5 flights within the United States, or 5 to 8 nights at a downtown Hyatt hotel (in many major cities).
  • You'll get some other attractive benefits with the Sapphire Reserve Card. These include airport lounge access, primary rental car insurance, and top-of-the-line travel and shopping protections.

The Freedom Unlimited Card has no annual fee. However, the Sapphire Reserve’s annual fee is a whopping $550, and you need to have it, or the Sapphire Preferred or Ink Preferred Card, in order to get good value from the points you earn with the Freedom Unlimited Card.

This isn’t as bad as it first appears. The Sapphire Reserve provides an automatic $300 travel credit. That means that the first $300 you spend on travel each year is automatically taken off your credit card bill.  This drops the total out-of-pocket cost to $250 per year. They also have a changing set of other credits, such as $60 per calendar year Door Dash credit, that can help offset the annual fee. For most of our readers, airport lounge access, high reward rates, and primary rental car insurance are worth it. 

If you don't value the airport lounge benefit and won't be spending very much on travel, you can always get the Sapphire Preferred Card, instead of the Sapphire Reserve. Its annual fee is only $95 and you can offset part of the fee with a $50 hotel credit (that you can only use on likely slightly overpriced rates through the Chase website). You'll only receive 1.25 cents per point (rather than 1.5 cents) when you use your points for offsetting credit card charges or making travel purchases through Chase, but since you are likely to get even more than 1.5 cents in value when you transfer your points to Hyatt or other travel partners, you are unlikely to want to take advantage of this option anyways. And you can always temporarily upgrade your card to the Sapphire Reserve at a later time to cash out your points.

Higher reward rates are possible with bonus categories

As part of a discussion of the best general purpose reward cards, it helps to understand how “bonus categories” work.

  • Many credit cards offer higher-than-normal rewards on spending within certain categories. For example, one card may give bonus rewards for purchases from gas stations and supermarkets, while another card may give bonuses on travel and restaurants.
  • Chances are, that as part of building out your core credit card collection, you will naturally wind up with a card that earns bonus reward rates on travel, restaurants, and some other purchases. Eventually, you may even choose to expand your credit card collection to specifically include cards just to take advantage of their bonus rewards. Optimize Rewards by Using Different Cards for Different Purchases.
  • Regardless of what you do in terms of bonus categories, you always want to get one general purpose card that earns a good reward rate whenever you use it and not just on specific categories. This will be your “fall back” card for any purchase where you can't earn bonus points or when you just want to keep things simple and put all your charges on a single card.  It is sometimes called your card for “everyday spending”. But we refer to it as your “general purpose” reward card.

Who should get a different card?

While the Freedom Unlimited / Sapphire Reserve combination is the right solution for most people, it isn't for everyone.

  • The Chase 5/24 rule might block you from getting the Freedom Unlimited and Sapphire Reserve cards. Chase limits access to the Sapphire Reserve and Freedom Unlimited cards to people who have signed up for fewer than five new credit cards in the past two years. This is called the “Chase 5/24” rule, and they count every new credit card you’ve gotten, regardless of whether it came from Chase or from another bank (even if you are just an authorized card holder).
  • If you’ve signed up for more than three credit cards in the last two years, you won’t be able to sign up for both these cards, regardless of your income and credit score. You can either hold off getting any new credit cards until you are under the limit or you can choose an alternative general purpose reward credit card.

  • You might get even more value from one of the advanced credit card options. There are some other cards that can earn even more valuable rewards than the Freedom Unlimited / Sapphire Reserve combination. But each has restrictions, caveats, or complexities that make them hard to broadly recommend. Depending on your circumstances, one of these advanced options (see below) might be for you.
  • You may not spend enough money to justify the Sapphire Reserve's annual fee. If you expect to spend less than about $20,000 per year on your general purpose reward card (and on travel and restaurant charges), the extra reward points you earn from the Freedom Unlimited / Sapphire Reserve combination may be worth less than the $190-250 effective annual fee.
  • If you don't get much value from the airport lounge benefit and don't expect to use your points for premium-cabin frequent flyer tickets, you are probably better off with a cashback card instead. Keep in mind, that even if you are interested in free airport lounge access, you can receive that benefit for years to come, by spreading out your premium credit card applications (and collecting the signup bonuses) over time.

  • You may prefer to earn points that can be used for an even wider variety of travel purchases. You can use your Ultimate Rewards points to pay for hotels, airfare, and other travel expenses through the Chase website (as well as for frequent flyer tickets and award nights). But you can't use them to purchase hotels on other websites (where you might find lower rates), on AirBnBs, or on admissions and activities. If you earn cash-like points, you can use your points for any of things (or often anything else).
  • For most people, earning Ultimate Rewards points is the better option. You can easily use up all your points on worthwhile redemptions and will generally get more value than you would earn from a cashback card. But if you don't expect to easily use up all your Ultimate Rewards points, because you don't expect to spend enough on airfares and hotels or because you are earning tons of points in other ways, you may want to just earn cash from your purchases.

No-annual-fee 2% cashback cards

There are several credit cards which give you 2% back on every purchase and don't have an annual fee. This are a good option if you want something a little simpler than the Chase Unlimited Combo, you are over 5/24, or you hardly spend any money on your cards each year.

  • Probably the best option is the relatively unknown USAlliance Visa Signature. While it has a 1% foreign transaction fee, it is one of the few cards that still offers the full suite of purchase protections (price protection, return protection, extended warranty, and purchase protection). And it even offers cell phone protection.
  • If you can't that card, the State Department Credit Union Preimum CashBack+ Card is another good option. It doesn't provide price and return protection, but there is no foreign transaction fee and it comes with a $200 signup offer ($3,000 initial spending requirement).
  • To get the card, you'll need to join the State Department Federal Credit Union. If you are not a State Department employee, according to this article at Doctor of Credit, you can join by first joining the American Consumer Council (at no fee).

    A somewhat less obscure option, the PayPal Cashback Credit Card also doesn't have a foreign transaction fee, but it doesn't provide the same purchase protections or a signup bonus.

If you highly value international business and first-class tickets, a card that earns "transferable points" is always better. No cashback or fixed-value card can provide as much value as you can get from redeeming your points for business and first-class frequent flyer tickets. You may not always be able to find award space, and it will require a lot of points for each ticket, but you’ll eventually be able to redeem your points for massive values. Your best options are the Chase Unlimited Combo (described above) or the Citi Double Cash Combo or Amex Blue Business Plus Card (described in our advanced options). Introduction to 'Transferable' Reward Points.

Advanced options

For most people, the best options are either to earn 1.5x Ultimate Rewards points with the Chase Unlimited combo or 2% cashback with one of the no-annual-fee options.

All the cards that offers more than 2% cashback involve extra time, effort, and/or fees, special relationships with banks, or only work for people who highly-value premium-cabin award redemptions and can earn enough points to make those a reality. These other cards can make sense for many people, but we can’t recommend them to most people who want to keep things simple and flexible.

However, some people can earn even more valuable rewards with other general purpose cards. Click to view our guide:

Most Likely Candidates
  • If you are eligible for a business card, comfortable to use it for your personal purchases, and willing to redeem all your points for frequent flyer tickets, the most valuable general purpose reward card is almost certainly the Amex Blue for Business Card. If you are committed to using your points for frequent flyer tickets, earning 2x Membership Rewards points is better than earning 1.5x Ultimate Rewards points or 2x ThankYou points. Just remember, that with Membership Rewards points, you typically don't have good options for non-frequent-flyer redemptions.
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  • If you have $100,000 in investment or retirement assets that you would be willing to manage through Merrill Lynch, you can earn 2.625% cash back with the Bank of America Unlimited Cash, Premium, and Travel Rewards cards. That level of assets qualifies you for Bank of America "Platinum Honors" status, which gives you a 75% bonus for the rewards you earn from some Bank of America cards. The reward bonus boosts the earning rate from these cards from 1.5 cents per dollar to 2.625 cents per dollar (which is the highest long-term cash back rate available from any card). If you have assets at another broker, you can usually transfer them to a Merrill Edge account and manage them there (at little or no additional cost) and qualify for the higher reward rate.
  • If you are willing to sign up for a new account each year, you can get a continuous 3% cash back with the Discover Miles Card. It earns 1.5% cash back, but gives you double the points at the end of your first year. The catch is that you'll have to get a new card ever year (and use up a credit card application slot) to maintain access to this effective 3% rate.
  • If you you are looking for cash back, you don't qualify for Platinum Honors, and you don't want to get a new Discover Card every year, you could consider the Alliant Cashback Card. As long as you jump through some hoops, you'll earn 2.5% back on your spending.



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