Home > Credit Card Reviews > 3 Credit Cards That Reward You for Being Responsible

Comments 2 Comments

[UPDATE: Some offers mentioned below have expired and/or are no longer available on our site. You can view the current offers from our partners in our credit card marketplace. DISCLOSURE: Cards from our partners are mentioned below.]

One reason many people dislike credit cards is that often, they impose harsh interest rates and fees when cardholders carry debt or miss payments. For example, most cards charge a late payment fee equal to the minimum payment or $25, whichever is less, and up to $35 for subsequent late payments. In addition, cardholders who pay late lose their grace period and have to pay interest charges on all of their purchases.

Thankfully, there are some rewards cards with incentives that encourage customers to use their credit cards responsibly, and at least one that has simply eliminated fees altogether.

1. Citi’s Double Cash Rewards Card

Citi recently introduced a new card that rewards cardholders as they pay off their debts. The Double Cash rewards card offers 1% cash back on all purchases, plus another 1% cash back as cardholders pay off their bill. So the sooner they make a payment, the sooner they receive their cash back.

According to Chris Fred, head of rewards product management at Citi Cards, “By earning an additional 1% cash back when their purchases are paid off, we hope customers will have a sense of accomplishment and an added incentive to pay down their balances quickly.” In fact, Fred anticipates this card will appeal to a broad cross-section of Citi’s customer base, not just the narrow segment focused on earning cash-back rewards.

Further, this card will automatically waive a customer’s first late fee, removing a significant penalty that cardholders face when they make a mistake with their payments. And unlike many other cash-back cards, there is no enrollment required, no spending categories to keep track of, and no cap on the amount of rewards that can be earned.

Citi cards also come with the Price Rewind service, which now covers purchases made within the past 60 days, up from 30, and up to $300 an item, up from $200. According to Citi, Price Rewind refunded customers an average of $85 on eligible purchases throughout 2013.

2. Journey Student Rewards Credit Card 

Capital One offers its Journey Student Rewards card with built-in incentives for young adults to get in the habit of paying their bills on time. Cardholders receive 1% cash back on all purchases, plus an additional .25% cash back each month that they pay their bills on time.

As a student credit card, Journey is available to those with average credit, which includes students with a limited credit history. Nevertheless, this card includes valuable benefits such as an extended warranty program, auto rental insurance and travel accident insurance. There is no annual fee for this card and no foreign transaction fees imposed on charges processed outside of the United States.

3. PenFed Promise Visa 

This card falls more into the category of a credit card that won’t punish you for being irresponsible, but we included it since it’s a card responsible cardholders are likely to find appealing. The Pentagon Federal Credit Union, or PenFed, offers members its Promise card that boasts no fees for anything. This includes no annual fee, late fee, balance transfer fee, foreign transaction fee, or even a penalty APR. So in essence, this card has removed all of the penalties for making late payments, other than the simple fact that interest will continue to accrue on cardholder’s balances.

Of course, those who consistently fail to make payments will find their accounts suspended or closed, and their payment history reported to consumer credit bureaus, which makes it optimal for cardholders who just slip up once in a while. Sill, cardholders with an imperfect payment history will be able to avoid all of the other punitive fees imposed by most cards.

Applicants must first become a member the credit union, which is available to a broad cross section of those who are active or retired members of the military and many other organizations, including the family and household of existing members. Others can join a military support group for a nominal one-time fee that qualifies them for credit union membership.

Only credit cardholders with the best credit scores get access to the best credit cards, and in that way, almost all credit cards reward responsible users. If you want to see where your credit stands, you can check two of your credit scores for free once a month on Credit.com.

At publishing time, the Journey Student Rewards card and PenFed Promise Visa are offered through Credit.com product pages, and Credit.com may be compensated if our users apply and ultimately sign up for these cards. However, this relationship does not result in any preferential editorial treatment.

Note: It’s important to remember that interest rates, fees and terms for credit cards, loans and other financial products frequently change. As a result, rates, fees and terms for credit cards, loans and other financial products cited in these articles may have changed since the date of publication. Please be sure to verify current rates, fees and terms with credit card issuers, banks or other financial institutions directly.

More on Credit Cards:

Image: iStock

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

  • http://www.Credit.com/ Gerri Detweiler

    It could be that the fact that you didn’t use it triggered a review.

  • http://www.credit.com/ Credit.com Credit Experts

    We can’t tell you for certain why the accounts were closed, but we can tell you that using a card just for the purpose of keeping it open can be a good idea. Closed accounts lower your credit utilization (the amount of credit you are using vs. the amount available to you) because they deny you access to a line of credit. You can read more here: The Biggest Credit Mistake People Make

Credit.com receives compensation for the financial products and services advertised on this site if our users apply for and sign up for any of them.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.

Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team