Why you might want a no-frills credit card in your wallet

Card minimalistsWhile they may not get the splashy homepage real estate on the issuer’s site, most issuers do have stripped-down cards that offer no rewards or fancy travel perks. Sound boring? Here’s why you may want one in your wallet – and some options to consider.

What are no-frills cards?

Before we dive into the reasons you may want one, here’s how we define no-frills credit cards:

  • No rewards or luxury perks: That doesn’t mean these cards have no perks, however. Because many basic cards still bear the Visa/MasterCard logo, they have some basic network benefits, including secondary rental car insurance and travel emergency assistance.
  • No annual fee: Because they’re not passing on any rewards or luxury perks, no-frills cards have no annual fee. Some cards have no rewards, but still have annual-fees (secured cards and cards for damaged credit, for example). But because those are designed for a niche consumer base (credit-rebuilders), we don’t consider them to be basic, no-frills cards.

Why you might want a no-frills card

Reason No. 1 – Rewards cards tempt you to spend more
Rewards cards are a great way to get a return on your regular spending. But research shows the promise of rewards can get you to spend more. In addition, rewards cards often offer sign-up bonuses – up to 100k extra points if you spend thousands of dollars in the first few months. It’s a hard opportunity to ignore, but if you don’t have a few grand worth of planned purchases in the next few months, a spending bonus may cause your finances more harm than good.

That all makes no-frills cards a safer alternative; while they’ll still allow you to shop online and rent a car more easily, they won’t lead you into temptation.

Reason No. 2 – You want to carry a balance
Cards laden with perks and rewards often have higher interest rates. So, if you’re carrying a balance month to month, a rewards card is not the best place for it – you’ll end up cancelling out any rewards you earn. No-frills cards tend to have lower APRs and perhaps longer 0 percent intro periods, so you can lower the costs of paying off a balance over time.

Even if you already have a rewards card, you might add a no-frills card for a planned big purchase. That way you can continue earning points, miles or cash back on everyday purchases while minimizing your interest costs as you pay off that big purchase.

Reason No. 3 – You want to keep your costs down
The annual fees on rewards cards are often justifiable. After all, the value of the rewards, lounge access and statement credits can often cancel out even high annual fees.

But if you’re aggressively paying down debt and simplifying your lifestyle to do so, you’re better off going without those perks and saving the cost of the annual fee.

Reason No. 4 – You’re building your credit

If you have imperfect credit, the bank may deny you its premium rewards cards anyway. Some rewards card come with minimum credit limits. After all, why would the bank want to pay for all your rewards and perks if you can put only $500 on its card?

So, if the bank isn’t comfortable giving you a higher credit line, you might want to go with a card that costs the bank less – a rewards-free, plain-and-simple card. Once you prove yourself with that product (by making on-time payments and keeping your credit utilization low), you can move up to a more exciting card.

Examples of no-frills cards

If your card strategy could benefit from a no-frills card, check our chart for some options to consider. We included only cards from major national issuers. Your local bank or credit unions may also have no-frills card options.

No-frills credit cards from major issuers
Bank of America
BankAmericard12.99% to 22.99% (variable, based on creditworthiness)
BankAmericard for Students12.99% to 22.99% (variable, based on creditworthiness)
Capital One
Capital One Platinum24.99 percent (variable)
Chase Slate15.99%-24.74% (variable, based on creditworthiness)
Citi Diamond Preferred13.49%-23.49 percent (variable, based on credit worthiness)
Citi Simplicity14.49%-24.49 percent (variable, based on credit worthiness)
HSBC Platinum MasterCard credit card (this offer is no longer available on CreditCardForum)13.99%, 17.99% or 23.99% (variable, based on credit worthiness)
USAA Rate Advantage Visa Platinum Card7.90% to 24.90% (variable, based on creditworthiness)
U.S. Bank
U.S. Bank Visa Platinum10.99% to 22.99% (variable, based on creditworthiness)
Wells Fargo
Wells Fargo Platinum Visa16.15% to 25.99% (variable, based on creditworthiness)

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