Best credit cards for back to school shopping - CNBC

Back to school is looking different this year due to the coronavirus pandemic, but parents still need to stock up on supplies for the upcoming school year. However, your list may have more electronics and hand sanitizer than last year as many schools anticipate a hybrid of online and in-person learning.

Parents with kids in elementary through high school said they plan to spend a record-breaking average of $789.49 on back-to-school supplies, according to the Back-to-School 2020 survey from the National Retail Federation. Spending increases to $1,059.20 for college students and their families, hitting another record high.

Before you start checking off your list, consider which credit card you plan to pay with. By choosing the right card, you can save money at checkout, earn generous amounts of cash back and/or benefit from intro 0% APR periods.

CNBC Select analyzed a variety of credit cards that can help you optimize back-to-school shopping for electronics, supplies, clothing, groceries and more.

Best credit cards for back to school shopping

Electronics

Apple Card

Information about the Apple Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.

• Rewards

  3% cash back on goods or services purchased directly from Apple (including Apple retail stores, the Apple online store, the App Store, iTunes, Apple Music and other Apple-owned properties) on Uber and UberEats, at Walgreens and Duane Reade stores, on the Walgreens app and on Walgreens.com, in T-Mobile stores, at Nike and at Exxon and Mobil stations, 2% cash back on Apple Pay purchases and 1% cash back on all other purchases

• Welcome bonus

• Annual fee

• Intro APR

• Regular APR

  10.99% to 21.99% variable

• Balance transfer fee

• Foreign transaction fee

• Credit needed

Pros

• No annual fee
• 3% cash back on goods or services purchased directly from Apple, on Uber and UberEats, at Walgreens and Duane Reade stores, on the Walgreens app and on Walgreens.com and in T-Mobile stores and at Nike
• No fee charged on purchases made outside the U.S.
• No late payment fee

Cons

• Apple Pay isn’t accepted everywhere
• Purchases with the physical card only earn 1% cash back
• No special financing offers or welcome bonus

• Estimated rewards earned after 1 year: $231
• Estimated rewards earned after 5 years: $1,156

To calculate the rewards you could earn using your Apple Pay card, we assumed that cardholders will use Apple Pay for 70% of their purchases at a rate of 2% cash back, since 70% of all merchants accept Apple Pay, according to an Apple spokesperson. We also assumed the cardholder would use the physical Apple Card for the other 30% of their purchases at a rate of 1% cash back. You may earn a higher or lower return depending on your spending habits.

Who's this for? Parents who prefer to purchase phones, tablets and laptops from Apple should consider the Apple Card. This card offers a competitive 3% cash back on goods or services purchased directly from Apple, including Apple retail stores, the Apple online store, the App Store, iTunes, Apple Music and other Apple-owned properties.

You can also earn 3% back when you use the Apple Card via Apple Pay at Walgreens and Duane Reade stores, on the Walgreens app, on Walgreens.com, on Uber and UberEats, in T-Mobile stores, at Nike, at Exxon and Mobil stations and at Panera. All purchases made with Apple Pay earn 2% cash back, and you earn 1% cash back when paying with the physical Apple Card.

With the Apple Card, you can benefit from receiving your cash rewards quicker than other cards. Cash back is referred to as "Daily Cash," which is deposited into your account at the end of every day, once the purchase is posted. Once you receive cash back, you're able to redeem it as a statement credit to your Apple Card balance, spend it like cash through Apple Pay, transfer it to a bank account or send it to friends via iMessage.

Online shopping

Amazon Prime Rewards Visa Signature Card

Information about the Amazon Prime Rewards Visa Signature Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.

• Rewards

  5% cash back at Amazon.com and Whole Foods Market; 2% back at restaurants, gas stations and drugstores; 1% back on all other purchases

• Welcome bonus

  $70 Amazon.com gift card upon approval

• Annual fee

  $0 (but Prime membership is required)

• Intro APR

• Regular APR

  14.24% to 22.24% variable

• Balance transfer fee

  5%, $5 minimum

• Foreign transaction fee

• Credit needed

  Excellent/Good

Pros

• No annual fee
• $70 Amazon.com gift card upon approval, with no spending requirements
• 5% back at Amazon.com and Whole Foods Market
• No fee charged on purchases made outside the U.S.

Cons

• Prime membership is required
• The 5% back on groceries only applies to groceries bought on Amazon.com or at Whole Foods Market

• Estimated rewards earned after 1 year: $510
• Estimated rewards earned after 5 years: $2,272

Rewards totals incorporate the points earned from the welcome bonus

Who's this for? The Amazon Prime Rewards Visa Signature Card offers a high 5% cash back at Amazon.com, which is great for all your online shopping needs. You also earn 5% cash back at Whole Foods Market, 2% back at restaurants, gas stations and drugstores and 1% back on all other purchases.

This card doesn't have an annual fee, but you do have to have an active Prime membership (currently $119 annually or $12.99 a month).

If you're approved for this card, you'll instantly receive a $70 Amazon.com gift card. This is a great way to offset some of upcoming back-to-school expenses or essentially cover some of the cost of your Prime membership.

Supplies and clothing

Target RedCard™

Information about the Target RedCard™ has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.

• Rewards

  5% discount at checkout on most purchases in-store and at Target.com

• Welcome bonus

  No current offer

• Annual fee

• Intro APR

• Regular APR

  22.90% variable

• Balance transfer fee

• Foreign transaction fee

• Credit needed

Pros

• No annual fee
• Instant 5% discount at checkout
• Free two-day shipping on most items
• Extra 30 days for returns

Cons

• Card can only be used in-store at Target or at Target.com
• High 22.90% variable APR

CNBC Select didn't calculate estimated rewards for store cards.

Who's this for? If you love going on Target runs, you may want to add the Target RedCard™ to your wallet. You can receive a 5% discount on most purchases, from school supplies to clothing. This discount is unique for credit cards because you receive it instantly at checkout, compared to other cards that reward you with cash back or points that need to be redeemed later.

In addition to a 5% discount, you can benefit from a variety of additional perks, such as free two-day shipping on hundreds of thousands of items from Target.com and an additional 30 days for returns and exchanges.

RedCard holders receive exclusive access to new product launches and a coupon for 10% off a purchase every account anniversary year if you sign up for Target marketing emails. Since this is a store card, you can only use it on Target.com and at Target locations.

Groceries

Blue Cash Preferred® Card from American Express

On American Express's secure site

• Rewards

  6% cash back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%), 6% cash back on select U.S. streaming subscriptions, 3% cash back at U.S. gas stations, 3% cash back on transit including taxis/rideshare, parking, tolls, trains, buses and more and 1% cash back on other purchases

• Welcome bonus

  $250 statement credit after you spend $1,000 on eligible purchases on your new card within the first 3 months

• Annual fee

• Intro APR

  0% for the first 12 months on purchases, N/A for balance transfers

• Regular APR

  13.99% to 23.99% variable

• Balance transfer fee

• Foreign transaction fee

• Credit needed

  Excellent/Good

Pros

• High 6% cash back at U.S. supermarket spending (up to $6,000 a year, then 1%)
• Unlimited 6% cash back on select U.S. streaming subscriptions
• Unlimited 3% cash back at U.S. gas stations and on transit
• A year of no interest on new purchases

Cons

• $95 annual fee
• 2.7% fee on purchases made abroad

• Estimated rewards earned after 1 year: $679
• Estimated rewards earned after 5 years: $2,397

Rewards totals incorporate the cash back earned from the welcome bonus

Who's this for? If you're not giving your kids lunch money anymore, you may be spending more money on groceries. In that case, the Blue Cash Preferred® Card from American Express offers the highest cash-back rate at U.S. supermarkets at 6% (on up to $6,000 per year in purchases, then 1%).

In addition to high grocery rewards, there's an unlimited 6% cash back on select streaming subscriptions, unlimited 3% cash back at U.S. gas stations, unlimited 3% cash back on transit including taxis/rideshare, parking, tolls, trains, buses and more and 1% cash back on all other purchases.

Cardmembers can also take advantage of Amex Offers, where you earn a statement credit or additional cash back at select retailers. These limited-time offers are location-based and additional terms apply.

This card does come with a $95 annual fee, but it can be offset by your cash-back earnings and discounts you can receive through the Amex Offers. See rates and fees.

Welcome bonus

Chase Freedom Unlimited®

On Chase's secure site

• Rewards

  Earn 5% cash back on grocery store purchases (not including Target^® or Walmart^® purchases) on up to $12,000 spent in the first year, Unlimited 1.5% cash back on all other purchases

• Welcome bonus

  $200 cash back after you spend $500 on purchases in your first 3 months from account opening

• Annual fee

• Intro APR

  0% for the first 15 months on purchases

• Regular APR

  14.99% to 23.74% variable on purchases and balance transfers

• Balance transfer fee

  Either $5 or 5% of the amount of each transfer, whichever is greater

• Foreign transaction fee

  3% of each transaction in U.S. dollars

Pros

• No annual fee
• Long intro 0% APR period for purchases
• Rewards can be transferred to a Chase Ultimate Rewards card
• Generous welcome bonus

Cons

• Below average 1.5% cash back
• 3% fee charged on foreign transactions

• Estimated rewards earned after 1 year: $713
• Estimated rewards earned after 5 years: $2,041

Rewards totals incorporate the cash back earned from the welcome bonus

Who's this for? If you have a lot on your shopping list, it can be a good time to earn a credit card welcome bonus. The Chase Freedom Unlimited® Card offers a generous welcome bonus with a low spending requirement: Earn $200 cash back after you spend $500 on purchases in your first three months from account opening.

Chase is also offering new cardholders 5% cash back on grocery store purchases (not including Target® or Walmart® purchases) on up to $12,000 spent in the first year, then 1.5% cash back. All other purchase earn unlimited 1.5% cash back.

In addition to earning rewards, you can benefit from a 0% APR for the first 15 months on purchases (then 14.99% to 23.74% variable APR). This can help you finance any big-ticket school supplies like laptops without incurring interest charges.

Cash back

Citi® Double Cash Card

On Citi's secure site

• Rewards

  2% cash back: 1% on all purchases and an additional 1% after you pay your credit card bill

• Welcome bonus

  No current offer

• Annual fee

• Intro APR

  0% for the first 18 months on balance transfers; N/A for purchases

• Regular APR

  13.99% - 23.99% variable on purchases and balance transfers

• Balance transfer fee

  3%, minimum $5

• Foreign transaction fee

• Credit needed

Pros

• 2% cash back on all purchases
• Simple cash-back program that doesn't require activation or spending caps
• One of the longest intro periods for balance transfers at 18 months

Cons

• No welcome bonus, so you can’t maximize rewards during the first few months of card opening
• Minimum cash-back redemption of $25
• 3% fee charged on purchases made outside the U.S.

• Estimated rewards earned after 1 year: $437
• Estimated rewards earned after 5 years: $2,185

Who's this for? The Citi® Double Cash Card is a solid choice if you're looking to maximize your cash-back earnings without having to worry about rotating reward categories. Cardholders earn 1% cash back on purchases and 1% when you pay off your bill. That makes the card's appeal almost universal, as you won't have to miss out on reward opportunities.

This card also comes with a generous balance transfer intro period that lasts for the first 18 months your account is open (then a 13.99% to 23.99% variable APR). Note that transfers must be initiated within four months of opening an account, and there's a 3% balance transfer fee ($5 minimum).

Plus if you forget to pay your bill, Citi will waive your first late fee. However, we recommend you pay off your credit card balance on time and in full each month to avoid interest charges.

Large purchases

U.S. Bank Visa® Platinum Card

Information about the U.S. Bank Visa® Platinum Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.

• Rewards

• Welcome bonus

• Annual fee

• Intro APR

  0% for the first 20 billing cycles on balance transfers and purchases

• Regular APR

  13.99% to 23.99% variable

• Balance transfer fee

  3%, minimum $5

• Foreign transaction fee

• Credit needed

  Excellent/Good

Pros

• 20 months of no interest on balance transfers and purchases
• No annual fee
• Cell phone protection plan

Cons

• No rewards program
• 2% to 3% foreign transaction fee
• Balances must be transferred within 60 days from account opening

• Transfer timeline: Balances must be transferred within 60 days from account opening
• Estimated total fees and interest on debt repayment: $388

Who's this for? If you plan on purchasing multiple high-cost items, such as a new desk or laptop for your kid(s), consider the U.S. Bank Visa® Platinum Card. This card provides one of the best overall intro APR periods: 0% for the first 20 billing cycles on balance transfers and purchases (then 13.99% to 23.99% variable APR).

Balance transfers incur a typical 3% fee (minimum $5) and need to be transferred within the first 60 days from account opening to qualify for the interest-free period.

This card doesn't offer a rewards program, but it does come with cell phone protection. Simply pay your cell phone bill with your card to receive coverage for damage or theft up to $600. There's a $25 deductible, for up to two claims ($1,200) per 12-month period.

Best credit cards for back to school shopping

Category	Electronics	Online shopping	Supplies and clothing	Groceries	Welcome bonus	Cash back	Large purchases
Credit card	Apple Card	Amazon Prime Rewards Visa Signature Card	Target RedCard™	Blue Cash Preferred® Card from American Express	Chase Freedom Unlimited®	Citi® Double Cash Card	U.S. Bank Visa® Platinum Card
Rewards	3% cash back on goods or services purchased directly from Apple (including Apple retail stores, the Apple online store, the App Store, iTunes, Apple Music and other Apple-owned properties) on Uber and UberEats, at Walgreens and Duane Reade stores, on the Walgreens app and on Walgreens.com, in T-Mobile stores, at Nike, at Exxon and Mobil stations and at Panera, 2% cash back on Apple Pay purchases and 1% cash back on all other purchases	5% cash back at Amazon.com and Whole Foods Market; 2% back at restaurants, gas stations and drugstores; 1% back on all other purchases	5% discount at checkout on most purchases in-store and at Target.com	6% cash back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%), 6% cash back on select U.S. streaming subscriptions, 3% cash back at U.S. gas stations, 3% cash back on transit including taxis/rideshare, parking, tolls, trains, buses and more and 1% cash back on other purchases	Earn 5% cash back on grocery store purchases (not including Target® or Walmart® purchases) on up to $12,000 spent in the first year, Unlimited 1.5% cash back on all other purchases	2% cash back: 1% on all purchases and an additional 1% after you pay your credit card bill	None
See below for our methodology	Learn MoreInformation about the Apple Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.	Learn MoreInformation about the Amazon Prime Rewards Visa Signature Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.	Learn MoreInformation about the Target RedCard™ has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.	Learn MoreOn American Express's secure site	Learn MoreOn Chase's secure site	Learn MoreOn Citi's secure site	Learn MoreInformation about the U.S. Bank Visa® Platinum Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.

Our methodology

To determine which credit cards offer the best value, CNBC Select analyzed popular credit cards available in the U.S. We compared each card on a range of features, including rewards, welcome bonus, introductory and standard APR, balance transfer fee and foreign transaction fees, as well as factors such as required credit and customer reviews when available. We also considered additional perks, the application process and how easy it is for the consumer to redeem points.

CNBC Select teamed up with location intelligence firm Esri. The company's data development team provided the most up-to-date and comprehensive consumer spending data based on the 2019 Consumer Expenditure Surveys from the Bureau of Labor Statistics. You can read more about their methodology here.

Esri's data team created a sample annual budget of approximately $22,126 in retail spending. The budget includes six main categories: groceries ($5,174), gas ($2,218), dining out ($3,675), travel ($2,244), utilities ($4,862) and general purchases ($3,953). General purchases include items such as housekeeping supplies, clothing, personal care products, prescription drugs and vitamins, and other vehicle expenses.

CNBC Select used this budget to estimate how much the average consumer would save over the course of a year, two years and five years, assuming they would attempt to maximize their rewards potential by earning all welcome bonuses offered and using the card for all applicable purchases. All rewards total estimations are net the annual fee.

While the five-year estimates we've included are derived from a budget similar to the average American's spending, you may earn a higher or lower return depending on your shopping habits

Don't miss:

For rates and fees of the Blue Cash Preferred® Card from American Express, click here.

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the CNBC Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.

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