The Ultimate Guide to Choosing the Best Credit Card for You
In the vast realms of credit cards, many options have been forged for the benefit of consumers: six from Chase, seven from Capital One, seven from American Express, and many more. But there can only be one credit card to rule them all. I have meticulously compiled the points and bonuses from 40 of the most popular credit cards, spending more time than Frodo Baggins took to carry the ring to Mount Doom to create a master spreadsheet. Finally, we can determine the one true ultimate credit card. If you know your budget and exactly how much you’re going to spend in relevant categories, you can identify the best credit card for you.
Understanding Your Spending Habits
The first step in choosing a credit card is understanding your spending habits. Are you earning points? Are you mindful of where you spend your money? Do you have to shop at specific stores, or are there rotating categories? Do you spend more on gas or dining out? These are the factors we need to consider.
Evaluating Annual Perks
The second source of points comes from annual perks. Are you getting Global Entry or TSA PreCheck for free? Do you have lounge access or complimentary memberships? These benefits add value and must be taken into account.
Maximizing Sign-Up Bonuses
The third source of points is sign-up bonuses. Are you receiving a significant number of points upfront, or are all your points matched in the first year? This is particularly important if you’re considering credit card churning, but it’s worth examining regardless.
Example: The Prime Visa Card
To illustrate, let’s consider the Prime Visa card. With this card, you earn a minimum of one point per dollar spent. Additionally, you earn two points for gas stations and dining and five points for shopping at Amazon, Fresh Whole Foods, and for all Amazon purchases, as well as Chase travel.
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Utilizing the User Profile Section
A crucial feature of this spreadsheet is the user profile section. This allows you to account for different spending habits and memberships. You might utilize this way: credit cards that don’t benefit you won’t factor into your total points. For instance, I’ve entered a zero in the Clear Plus section for American Express cards, because my wife and I use Global Entry.
Analyzing Our Budget
For this analysis, I’ll use our actual budget to determine which card is best for us. We’ll also highlight some top credit cards at different spending levels, so you can see where you might fit in. Our expenses are divided into monthly and yearly categories. Monthly expenses include utilities, groceries, and subscriptions, while yearly expenses cover gifts, travel, and home improvements. Our annual credit card spending is $38,255.
The Results: Top Credit Cards
After analyzing the data, the Capital One Venture X credit card emerges as the best option for us, providing $867 in value annually, excluding the first-year sign-up bonuses. The second-best card is the X1 credit card from Robin Hood, offering $788 in value. The Chase Freedom Flex card takes third place, despite its flexible categories.
The Venture X Card: A Closer Look
The Venture X card, with a $395 annual fee, might seem daunting at first. However, the annual bonuses put you $130 in the green each year. You receive a $300 annual travel credit, a $100 anniversary bonus, and lounge access. The sign-up bonus applicable only in the first year adds significant value.
Churning Credit Cards
For those interested in churning, where you open a new credit card to take advantage of the sign-up bonus and then close or downgrade it, the Venture X card again comes out on top. In the first year, we gain almost $1,700 in value. The Chase Sapphire Reserve and another Capital One Venture card follow closely.
Conclusion: The One Card to Rule Them All
In the battle of credit cards, the Venture X from Capital One reigns supreme, offering the most points annually and for churning. However, the only way to know which credit card is best for you is to do the math. You can use my spreadsheet available for free in the description or explore other videos in my credit card series for more detailed analyses. As found on YouTube
