Some of you may not like the idea of trying out a new credit card with an annual fee and possibly having to cancel the card later (even if comes with a big sign-up bonus!), though the effect on your credit score is a lot less than many media articles would lead you to believe. Here are a couple of cards with $100 sign-up bonuses and minimal requirements (indeed, they would have been rock stars in 2008 and 2009) – but are also everyday “keeper” cards with no annual fee. I’ve had both of them for years.
- $100 bonus cash back after spending just $500 in first 3 months.
- Earn 5% cash back on up to $1,500 spend on rotating categories each quarter. 2nd quarter 2013 categories are Restaurants, Movie theaters and Lowe’s.
- Earn 1% cash back on everything else. There is no limit on the 1% cash back.
- Instead of cash, you can also redeem points at Ultimate Rewards site.
- No annual fee.
- $100 cash back after $500 in purchases within the first 3 months of account opening.
- Earn 5% cash back from Citi at Home Depot, Home furnishing stores and home and garden stores between 4/1/13 and 6/30/13, with enrollment.
- Full 1% cash back on all other purchases and eligible cash advances.
- No annual fee.
Which one is better?
Both offer a $100 bonus after spending $500 on the card for anything (40% back). Both offer 5% back on select categories, and the good thing is you can benefit from having both cards since their categories often don’t overlap. Both require you to “activate” the 5% online each quarter, which is a bit annoying but only takes a minute. Both cap their rewards at similar levels (5% of $1,500 is $75 per quarter = $300 per year). Both have no tiers on their 1% back on everything else. The Chase Freedom has no expiration of rewards as long as the account is open, whereas the Citi Dividend rewards do not expire as long as you have activity once every 12 months. Last I checked, the minimum redemption amount was $20 for Chase, $50 for Citi. Overall, they are both very similar in my opinion.
However… in my credit card survey a few weeks ago with over 3,000 reader responses, there was an open-ended question asking which card was the “best credit card on the market today”. The #1 most popular answer was the Chase Freedom card, beating out everyone including travel cards. Where was the Citi® Dividend Platinum Select® Visa® Card? Not even in the top 20. The people have spoken, but I’m really not sure why! Better commercials?
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