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Gift shopping season is here — and many Americans feel their finances aren’t ready. A recent Bankrate survey found that 40% of holiday shoppers expect to be financially burdened this year.
One way to ease some of the shopping stress? Putting your gifts on plastic. Using a credit card for your holiday spending can help you earn rewards, maximize your budget, and save you money.
The best credit cards for holiday shopping come with no annual fees, generous rewards, and competitive welcome bonuses. So, while you’re out making a list (and checking it twice), consider using one of these seven cards.
Best credit cards that save money while holiday shopping
- Bank of America® Customized Cash Rewards Credit Card: Best for online shopping
- U.S. Bank Cash+® Visa Signature® Card: Best for electronics and department store purchases
- Blue Cash Preferred® Card from American Express: Best for holiday grocery shopping
- Wells Fargo Active Cash® Card: Best for flat-rate cash back rewards
- Prime Visa Card: Best for Amazon purchases
- Capital One Walmart Rewards® Mastercard®: Best for Walmart purchases
- Costco Anywhere Visa® Card: Best for Costco purchases
Bank of America Customized Cash Rewards credit card: Best for online shopping
The Bank of America Customized Cash Rewards credit card is our top pick for online shopping.
You can earn 3% cash back in your chosen category, including online shopping, dining, travel, gas, or even home improvement. Plus, you’ll earn 2% cash back at grocery stores and wholesale clubs and 1% cash back on all other purchases.
Unlike other rewards cards, you can choose the category where you want to earn 3% cash back, and you can change it once per month. So, if you’re doing most of your holiday shopping online, you can choose it as your preferred category to maximize your rewards.
This card has no annual fee, a decent cash welcome bonus, and a lengthy 0% introductory APR offer for purchases and balance transfers. Also, if you’re a Bank of America Preferred Rewards customer, you can boost your rewards by 25%-75%.
U.S. Bank Cash+ Visa Signature Card: Best for electronics and department store purchases
If you have a tech enthusiast or a fashionista on your holiday list, the U.S. Bank Cash+ Visa Signature Card could be the perfect fit for you. This card rewards you for your spending habits, especially in these specific categories.
You can earn 5% cash back on the first $2,000 spent each quarter in two categories of your choice — including electronics stores and department stores. After that, you’ll earn 1%.
You can change your 5% cash back categories every quarter, allowing you to adjust your preferences based on your shopping needs. You also earn 2% cash back on one choice everyday category, which often includes gas, restaurants, and grocery stores. You’ll earn 1% unlimited cash back on all other purchases.
Like the Bank of America Customized Cash Rewards card, the U.S. Bank Cash+ comes with no annual fee, a solid welcome bonus, and an extensive 0% introductory APR offer for purchases and balance transfers.
Blue Cash Preferred Card from American Express: Best for holiday grocery shopping
The Blue Cash Preferred Card from American Express can make your holiday grocery hauls more rewarding.
With the Blue Cash Preferred, you can earn a whopping 6% cash back on up to $6,000 spent at U.S. supermarkets annually (then 1%). So, while you’re stocking your pantry and preparing a delicious holiday feast, you’ll earn generous rewards.
You can also earn 6% cash back on select U.S. streaming subscriptions, 3% cash back at U.S. gas stations, and 1% on all other purchases. The cash back rewards on gas can be a great perk if you’re planning holiday road trips or fueling up for gatherings with loved ones.
This card has an introductory annual fee of $0 in the first year and costs $95 annually afterward. It often comes with a welcome bonus after spending a certain amount in the first few months of owning the card. See rates and fees.
The Blue Cash also includes access to exclusive discounts, entertainment experiences, and travel perks, enhancing your holiday season.
Wells Fargo Active Cash Card: Best for flat-rate cash-back rewards
Holiday shopping is stressful enough. If tracking rotating spending categories adds to your stress, consider the Wells Fargo Active Cash Card.
The card earns an unlimited flat rate of 2% cash rewards on all purchases. Whether buying gifts, decorations, or holiday supplies, you can earn cash rewards on every transaction.
The flat cash rewards rate is especially beneficial when expenses tend to increase during the holiday season. Unlike cards with rotating categories or spending limits, the Active Cash offers consistent and reliable cash rewards. So, whether you’re splurging on big-ticket items or making smaller purchases, you’ll earn rewards that add up quickly.
This card comes with a welcome bonus to new cardholders, which can provide a significant boost to your holiday shopping budget. It also has no annual fee and features a generous introductory APR for purchases and qualifying balance transfers.
Amazon Prime Rewards Visa Signature Card: Best for Amazon purchases
If you’re an avid Amazon shopper, the Prime Visa Card is a perfect fit for you. Cardholders earn an impressive 5% cash back on all eligible Amazon.com or Whole Foods Market purchases.
Whether you’re buying gifts, groceries, or even everyday essentials, you’ll earn a generous 5% unlimited cash back on every purchase. You also earn unlimited 2% cash back on restaurants and gas stations, unlimited 2% cash back on local transit and commuting, and unlimited 1% cash back on everything else.
Upon approval, you’ll earn a $150 Amazon gift card, which can be a great way to kickstart your holiday shopping. You can also access exclusive deals and discounts on Amazon products and services.
The Prime Visa card technically doesn’t have an annual fee, but you’ll have to be a Prime member to qualify, which costs $14.99 per month or $139 per year. Because most of this card’s features are tied to Amazon, it’s really only a good fit for Prime members who shop with the online retailer frequently.
Capital One Walmart Rewards Mastercard: Best for Walmart purchases
The Capital One Walmart Rewards Mastercard can help you maximize your trips to Walmart, particularly during the holiday season.
You can earn up to 5% cash back on purchases made at Walmart.com, including pickup and delivery. During the holiday season, when Walmart offers a wide range of products and deals, this cash back rate can be beneficial. It can help you save money and stretch your holiday budget even further.
The card also comes with a welcome offer of 5% cash back in Walmart stores in the first 12 months, as long as you use your card with Walmart Pay. This gives you flexibility in how and where you shop. You also earn 2% cash back on eligible travel and dining purchases, including restaurants and hotels. You’ll earn 1% cash back everywhere else.
The Capital One Walmart Rewards card has no annual fee and is instantly available in the Walmart app once you’re approved.
Costco Anywhere Visa Card by Citi: Best for Costco purchases
If you’re a Costco member and love shopping at their warehouse stores, consider the Costco Anywhere Visa Card.
Earn generous cash back on your Costco shopping trips, including 4% cash back on eligible gas purchases at Costco and other gas stations (up to $7,000 annually, then 1%). Whether you’re fueling up for holiday road trips or running errands, you’ll earn solid cash back on your gas expenses.
This card also offers 3% cash back on restaurant and eligible travel purchases, 2% on all Costco and Costco.com purchases, and 1% on all other purchases. The Costco Anywhere Card comes with no annual fee, though you do need to be a Costco member to qualify. Costco membership costs $60 annually.
Using credit cards for holiday shopping
Making holiday purchases with a credit card can be rewarding — literally.
But, if you’re not careful, using a card can lead you to spend beyond your holiday budget. To avoid overspending (and going into debt), here are some tips on how to use your cards responsibly this holiday season.
- Review your card’s benefits: Take the time to understand how your card’s rewards, cash back, or points work. This will help you maximize your benefits and make the most of your holiday shopping.
- Set a budget: Determine how much you can put towards holiday shopping and set a spending limit. This will help you avoid overspending and accumulating unnecessary debt. “Don’t succumb to the ‘buy now, pay later’ mentality,” says Jeff Rose, certified financial planner and founder of GoodFinancialCents.com, “which could create a debt cycle that’s hard to break.”
- Create a holiday fund: Open a separate savings account specifically for holiday shopping. You can make small contributions throughout the year “so the financial burden doesn’t hit all at once,” says Rose.
- Plan your purchases: List the items you need to buy and prioritize them. This will help you stay focused and avoid impulsive purchases.
- Look for promotions and discounts: Keep an eye out for promotions, discounts, or rewards offers available through your card. Many credit cards offer bonus rewards or savings during the holiday season.
The bottom line
The best credit cards for holiday shopping should have generous rewards, welcome offers, no annual fees, flexible redemption options, purchase protection, and more.
Choose the best option that aligns with your spending habits and offers benefits beyond the holiday festivities. Using your credit cards responsibly and sticking to your budget can help you avoid overspending during the holiday season.
[Disclaimer]: *Eligibility and Benefit level varies by Card. Terms, Conditions, and Limitations Apply. Please visit americanexpress.com/benefitsguide for more details. Underwritten by Amex Assurance Company
Opinions expressed are author’s alone, not those of any bank, credit card issuer, or other entity. This content has not been reviewed, approved, or otherwise endorsed by any of the entities included in the post.