Best no-annual-fee credit cards for January 2022

The Chase Freedom Unlimited® card wins the spot for best no-annual-fee credit cards for a few reasons. This card offers an extensive cash-back rewards program, allowing you to earn more rewards on grocery stores, eligible travel, dining and drugstore purchases than you could with the other best no-annual-fee cards. 

If we were to feature a pick for the best grocery store credit card with no annual fee in this list, the Chase Freedom Unlimited would also walk away with that title. This card also offers a $200 welcome bonus when you spend $500 in the first three months of account ownership and a 15-month 0% introductory APR on purchases (14.99% to 24.74% variable APR thereafter). 

With the Bank of America® Travel Rewards credit card*, you earn 1.5 points (equivalent to 1.5 cents) for every dollar spent on any purchase, anywhere. These points can be redeemed for statement credits against travel expenses like hotels, flights and restaurants, with no restrictions on airlines, websites or dates. You’ll also enjoy no foreign transaction fees, so anywhere you travel to, you can use this credit card without penalty. The sign-on bonus and introductory APR make this a well-rounded everyday credit card, as well.

The Bank of America® Customized Cash Rewards credit card* offers a lot of flexibility. Unlike most credit cards where you can choose a category, this one doesn’t rotate — making it a valuable tool you can use all year long. You can earn 3% cash back on the category of your choice, on up to $2,500 of expenditure per quarter in combined 3% and 2% categories, then 1% thereafter. The default category selection is gas, and for all others you must manually switch the selection through your account. Alternatively, this card would also be selected as the best no-annual-fee credit card for online shopping, as that is another category you can manually choose.

The Wells Fargo Active Cash Card offers an unlimited 2% flat cash rewards structure, making this a simple but powerful card. There’s no worrying about reward limits or bonus categories — you’ll earn a flat rewards rate on eligible everyday purchases. Plus, if you spend $1,000 in purchases in the first three months of opening your account, you’ll earn a $200 cash rewards welcome bonus. You can also take advantage of the low introductory APR on purchases and qualifying balance transfers, as this is a well-rounded card.

What does ‘no annual fee’ mean?

It means the card issuer will not charge you a yearly cardholder fee. Cards with no annual fees may have other fees though — such as security deposits, transaction fees, late payment fees and balance transfer fees. Many different types of cards offer no annual fee, such as most student credit cards.

What else should I consider about credit cards with no annual fees?

If you use your card more and want access to better incentives, it is easy to make the switch. Alex Miller, CEO and founder of Upgraded Points, said, “No-annual-fee credit cards tend to have a ‘sister’ card with an annual fee. You can upgrade from a no-annual-fee to an annual fee card, usually with little to no hassle.” With these upgraded cards, you can typically earn even more rewards.

Are annual-fee cards ever worth it?

Sometimes. If you’re new to using credit cards or do not plan to charge many expenses, then having a card with an annual fee will not be in your best interest since you won’t take advantage of the incentives enough to justify the cost. 

Meanwhile, there are instances where the opposite applies. “Annual-fee cards are worth it for people who spend more money because they have much higher bonuses on spending categories,” said John Taylor Garner, CEO and founder of Card Curator. “And their points/miles are worth a lot more, especially when redeemed for travel.”