Best Credit Cards for the Holidays

By Miranda Marquit. Last updated 1 June 2015. 3 comments

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With the holidays coming up fast, now is a good time to get a jump on your shopping. It’s easier on your budget when you plan out your holiday spending over a couple of months rather than cramming it all in during December. If you want to make your holiday spending even more effective, consider using a well-chosen credit card to make your purchases. 

A card that offers an introductory purchase rate of 0% can make your spending more manageable. Even better? Cards with rewards programs and/or huge sign up bonuses. Not only can you complete your holiday shopping, but you can also reduce the overall impact to your budget with the help of cash back and rewards points. (See also: How to Choose Between a Cash Back or Travel Rewards Credit Card)

But the very best credit card can only benefit you if you're using it responsibly. All the cash back or travel reward points isn't going to cover the interest rate charged if you keep a balance. A good credit card does not replace planning and budgeting. It only helps take the sting out a little. Most of us spend more during this time of year, and it makes sense to use the holiday burst of spending wisely. Each of the cards noted below will help you do just that.

Best Cash Back Rewards

A good cash back rewards card will lower your holiday expenses automatically. (See all of our picks for the best cash back reward credit cards.)

Discover it®

Discover it® offers 5% cash back in categories that change each quarter up to the quarterly maximum when you sign up, plus 1% cash back on all other purchases. As an exclusive offer, Discover will double all the cash back you've earned at the end of your first year — automatically. But the thing that makes this the ideal card for holiday shopping is the 5-20% cash back it offers if you shop via its shopping portal, which includes over 200 online popular retailers like Apple, Macy's and Best Buy. Besides being a great cash rewards credit card, it also offers protection from higher APRs due to late payments, no overlimit fee, and you get a free FICO® Credit Score on your monthly statement, online, and in their mobile app so you can keep track of your credit. Identity theft is rampant during the holidays; with Discover's new Freeze ItSM on/off switch, you can freeze or unfreeze your account in seconds via their website or mobile app.

This card currently has a sign-up bonus offer of 0% APR on purchases and balance transfers for 12 months — then a variable purchase APR applies (currently 10.99% - 22.99%). There is no annual fee.

Click here to apply for the Discover it® card.

Best Cash Back Sign Up Bonus

Some cards offer a nice sign up bonus in the form of cash back. Give yourself a little head start to help with your shopping list.

Blue Cash Preferred® Card From American Express

Who wouldn't want an extra $150 to spend this time of year? Apply for the Blue Cash Preferred® Card. New cardmembers get $150 back (as statement credit) after spending $1,000 in purchases within the first 3 months. Earn 6% back at US supermarkets (up to $6,000 per year in purchases), 3% back at US gas stations and select US department stores, and 1% on other purchases. Terms and limitations apply. Finally, new cardmembers also get 0% APR on purchases and balance transfers for 15 months, then a variable rate of 12.99%-21.99% (depending on your creditworthiness) applies. The annual fee is $75.

Click here to apply for the Blue Cash Preferred® Card from American Express today!

Best 0% APR on Purchases

A 0% APR on purchases essentially is a free loan. Right now, the best cards offer up to 21 months of 0% APR. This will allow you to spend what you need to without incurring interest charges. The important thing is that you commit to paying it off within the time period. See all our picks for the best 0% APR credit cards.

Citi Simplicity® Card

credit card

The Citi Simplicity® MasterCard offers 0% APR for 21 months on both balance transfers and new purchases. After that, the regular balance transfer APR will be 12.99%-22.99% (variable), depending on your credit. There is a $5 or 3% balance transfer fee (whichever is greater). This card offers no late fees or penalty interest rates. There is no annual fee.

Click here to apply for the Citi Simplicity® Card

Best Travel Rewards

You can rack up a ton of miles on your holiday purchases. Give yourself a nice vacation for all the giving you'll be doing for others! See all our picks for the best travel rewards credit cards.

British Airways Visa Signature® Card

The British Airways Visa Signature® Card has a great sign-up offer for new cardmembers: earn 50,000 bonus points (called Avios) after spending $2,000 on purchases within the first 3 months. Also, if you make $30,000 in purchases in a calendar year, you will receive a Travel Together Ticket so that you can get a free ticket for your companion the next time you redeem a rewards flight. Cardholders earn 3 Avios on British Airways purchases and 1 Avios for every dollar spent on other purchases. Travel freely with this card that has Smart Chip Technology and no foreign transaction fees. The annual fee of $95 is waived for the first year.

Click here to apply for the British Airways Visa Signature® Card today!

Best 0% Balance Transfer

If you are already carrying a balance, it may not be wise to continue to rack up additional debt. But if you must spend during the holidays, giving yourself some interest-free breathing room can be a life saver. Better yet, use your best rewards credit card for holiday shopping, and then do a balance transfer to a new card. See all our picks for the best balance transfer credit cards.

Chase Slate®

The Chase Slate® card was named "Best Credit Card for Balance Transfers" two years in a row by Money Magazine. It offers 0% APR for 15 months on purchases and balance transfers as well as free monthly FICO Score and credit dashboard to monitor your credit. What makes this card special is the $0 balance transfer fee for transfers made during the first 60 days. You can move your holiday purchase balance over here to get a 15 month break from interest. There is no annual fee.

Click here to apply for the Chase Slate® card

Savvy Credit Card Use During the Holidays

Make sure that you are smart about your credit card use during the holidays. Even though there are some great terms associated with many of these credit cards, you don’t want to fall into the debt trap.

Do Your Best Only to Spend Money That You Already Have

Rewards credit cards are most effective when you make planned purchases, and then pay off the balance each month. That way, you earn the rewards, but you don’t end up having their value eroded by interest charges.

If You're Going to Carry a Balance, Choose Your Card Wisely

If you think that you will need to carry a balance as a result of your holiday shopping, look for a rewards card with a 0% APR on purchases for a few months. Make a plan to pay off the balance before the end of the intro period. In any case, it’s best if you avoid carrying a balance for more than three or four months. Choose a card with an intro period, and you can still earn rewards without paying interest.

With the right plan, you can take advantage of credit cards for the holidays, earning bonuses and rewards that can help you offset your spending, saving you money on purchases now and interest later.

Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved or otherwise endorsed by any bank, card issuer, airline or hotel chain.

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Guest's picture

Great article!! Especially now since it is close to the holidays, this was a perfect read. It’s good to know of the some of the best credit cards for the holidays.

Guest's picture

After reading the post that was entirely dedicated to the Chase Sapphire Preferred Card, it definitely seems like a good deal, but especially if you're looking for a card just to make it through gift-buying season. As a very recent post-grad, I'm lucky that I'm not expected to get anyone too expensive this Christmas season.

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Credit Card Rewards Nerd

The Discover More card is also paying 5% cash back on all Internet shopping as well as department store shopping for up to $1500 in spending from October through December.

You might also be interested in the rewards calculator at http://www.creditcardtuneup.com/ . You enter your average monthly spending in categories like restaurants, groceries, gas, airfare, hotels, etc. and it calculates the single best card as well as the best combinations of cards for your spending profile.