Best October Credit Cards: Chase, Discover and Capital One Lead the Way
October is here and there are plenty of credit-card treats to be had for those willing to do a little research on the best credit cards available.
This month has been an interesting one because it saw the emergence of a new card from Capital One – the Savor. There are also some excellent offers going on for a couple of popular retail stores.
Best Card for Walmart Purchases: Chase Freedom
From October through December the Chase Freedom card is offering 5% cash back on all purchases made at Walmart, either at the company’s brick-and-mortar stores or through its website.
There’s a $1,500 spending cap on spending, which, considering the 5% bonus is good during the holiday seasons, shouldn’t be too difficult to hit, especially if you do most of your grocery and housewares shopping at Walmart.
The Chase Freedom’s 5% rewards come to you in the form of points. You can redeem these points for cash at a rate of $0.01 per point – 1,000 points is $10 – or you can transfer those points to the Chase Ultimate Rewards program.
Transferring the points requires one thing though: You’ve got to have a Chase Sapphire Preferred or Reserve card, or a Chase Ink Business Preferred card.
The advantage to this is that you can use those points to book free travel with Hyatt, Marriott, Southwest Airlines, United Airlines and more.
Best Card for Foodies: Capital One Savor
This month was kind of a big deal for Capital One because they launched the Savor card, a rewards credit card that’s focused on foodies. Why foodies?
Cardholders will get 3% cash back on purchases at restaurants and fast food places, as well as 2% back on groceries.
Basically, any food you buy will get some sort of rewards rate. Whole Foods, Trader Joe’s, Outback, Chili’s, McDonald’s; it’s all fair game for the Savor card’s rewards rates.
Just to give you an idea of how much you could earn from this card, the Bureau of Labor Statistics Estimates that the average household spends about $3,154 a year eating out, which equates to nearly $100 in cash back rewards.
The same stats say that the average household spends about $4,000 a year on groceries, which is kind of low, especially if you have kids. But, either way, at $4,000 a year, you can earn $80 in rewards.
Spend more than that? Multiply your yearly grocery bill by 0.02 and that’s how much you’ll earn in rewards.
Best Card for Target Purchases: Discover it Cash Back
In the same way that the Chase Freedom card is offering 5% cash back on Walmart purchases from October to December, the Discover it Cash Back is offering 5% cash back at Target and Amazon.com.
Also, like the Chase card, Discover limits your rewards spending to $1,500. Once you spend $1,500 at Target and Amazon, the rewards rates on those purchases goes down to 1%.
There are a couple of reasons why this card’s 5% Target bonus is a big deal. First, it offers a great rewards option for those who have this card and the Chase Freedom card and would rather buy home goods, groceries and holiday presents (not to mention Halloween decorations) at Target instead of Walmart.
Second, should anything go awry with your rewards balance, Discover has a sterling customer service reputation, often finishing in the top two of J.D. Power’s yearly credit card satisfaction survey.
Considering that the average American spent about $1,000 on holiday purchases in 2016, you should be able to hit the $1,500 limit and maximize your rewards.
Why Credit Cards Are a Better Choice Over Store Cards
One of the main reasons we’re recommending mainstream credit cards over store credit cards is that the Chase Freedom and the Discover it have lower interest rates than credit cards you can get from Walmart and Target.
The Discover it’s lowest APR is 11.99% compared to the Target REDcard’s 23.90% APR and the Chase Freedom’s low APR of 15.99% is far lower than the Walmart credit card’s 23.90%.
These big differences in APR can save you considerable cash, especially since many of us go into debt during the holiday months.