The Best Rewards Credit Cards for Big Spenders

Rack up serious points with the right piece of plastic.

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Do you spend a lot on your credit card? If you do but don't use a credit card that earns you the best rewards, you're not getting the most out of your money.

Rewards cards vary significantly in terms of what areas you can rack up big points in (some cards offer better rewards for hotels and flights, while others yield higher returns for gas and groceries), but the best cards require excellent credit to qualify—generally scores of 750 and above. "They're great cards, which means you have to have great credit to get them," says Beverly Harzog, an independent credit-card expert and consumer advocate. You can get an estimate of your credit score for free at MyFico.com.

A great rewards card will enable you to bank significant discounts on hotels and flights, while others will earn you large amounts of money in cash back on everyday expenses like groceries and gas. However, a rewards credit card isn't a good option if you can't pay off your balance in full each month. "If you carry a balance, the [annual percentage rate] is going to eat away all the rewards you earn," says Bill Hardekopf, a credit expert with LowCards.com.

"That's always the trap for the card holder: They'll get so excited about earning rewards that they charge more than they can afford to pay off in full, in which case rewards can become very costly, very quickly," says Gerri Detweiler, director of consumer education at Credit.com.

Many rewards cards carry higher interest rates than standard credit cards: As of mid-August, the average consumer rewards card interest rate was 17.64 percent, versus 15.15 percent for a non-rewards card. Annual fees are also common among many rewards credit cards, with most starting around $59.

However, a $7 billion settlement with Visa, MasterCard, and several major banks last month over interchange fees could adversely affect what consumers have to pay for using a rewards credit card. The settlement would reduce the interchange fee that banks can charge for the next eight months and would enable retailers to charge fees on each swipe directly to consumers who use credit or debit cards in order for them to make up the costs. "If the credit card interchange fee gets sliced dramatically, that can affect the rewards that credit card issuers can offer," Hardekopf says, since banks make a large chunk of their money off the interchange fees. If the banks and credit card companies scale back the interchange fees, that means they'll make less money on each transaction and, in turn, could mean they'll no longer be able to offer such attractive rewards on their credit cards. Some critics have gone so far as to say this could mean the end for rewards credit cards.

Yet a number of major retailers, including Walmart and Target, are opposed to the settlement. With such significant opposition, Harzog believes it will take a while for consumers to feel the effects of the settlement. Harzog and Hardekopf say they don't think the settlement means the end for rewards credit cards.

For now, rewards credit cards offer lucrative perks for card users, and the potential rewards are greatest for big spenders. U.S. News asked credit-card experts for their top picks:

PenFed Premium Travel Rewards American Express Card. Harzog says this is a great card for frequent travelers. Cardholders get five points per dollar on airfare and one point per dollar on all other purchases. They can also earn 20,000 bonus points if they spend $650 in the first three months. The interest rate is also attractive, at a variable 9.99 percent until June 30, 2014—meaning the rate can only decrease during that time.

There's no annual fee and no cap on the amount of rewards you can earn. "Big spenders want to know they can earn unlimited rewards, otherwise they have to start shuffling cards," Detweiler says.

Capital One Venture Rewards Card. This card is also a winner in the travel category. It offers two miles per dollar on every purchase, with unlimited miles, and you can buy any airline ticket or hotel room you want with no blackout dates. "I've had this card for about a year and really like the flexibility of being able to get airline seats and hotel rooms without hassle," says Liz Weston, author of Your Credit Score. "Also, it has no foreign transaction fees, which made it a great choice for a recent trip to Europe."