The Best 3 Card Beginner Credit Card Setup

When it comes to beginner credit card setup recommendations, don’t be surprised if most people you ask answer with some American Express or Chase Bank credit card.

Both these issuers have some of the best referral programs in the game. They offer significant incentives for users to refer others, such as bonus points or cash rewards, making their programs highly appealing. That means people are monetarily incentivized to recommend the card to others.

Of course, there are good reasons to get an AMEX or Chase card.

However, when it comes to a beginner setup, I think only one card issuer ticks all the boxes.

Talking about boxes to tick for someone who’s looking for their first two to three cards. Let’s look at these boxes.

Most Important Criteria

There are two important criteria to keep in mind when picking your first few cards:

Minimum annual fees

Easy to earn points

Points can be redeemed as both cashback and travel rewards

Early on, you want to keep your annual fees low. Otherwise, you will end up paying more in annual fees than you get back in rewards. Some travel cards have annual fees as high as $697 or $550.

The next criterion - easy to earn points! If you cannot accumulate points quickly enough to make your first few travel redemptions, you won’t stay motivated to keep playing the game. To my surprise, some credit card ecosystems are good, but notoriously difficult to stockpile points quickly. In the beginning, you want to avoid those ecosystems.

The final criterion - points can be redeemed as both cashback and travel rewards. Not everyone travels at least once every year. For others, transferring points from a credit card issuer to a transfer partner can seem like a very tedious/complex workflow. In these cases, the easiest way out is to cash out your points. Say you have accumulated 100K points. You can cash them out for $1,000.

Why American Express & Chase Do Not Work

Some of my favorite credit cards are from American Express and Chase. Then why am I recommending them?

Simple: it’s difficult for a beginner to accumulate points quickly and make easy travel redemptions while keeping annual fees at a minimum in both these ecosystems.

Let’s start with American Express.

Pros

Easy to accumulate points quickly

Cons

High annual fees (anywhere from $150 to $600)

Cannot easily redeem as cashback

Now, let’s look at Chase.

Pros

Minimum annual fees

Points easily redeemable as both cashback and travel rewards

Cons

Notoriously difficult to accumulate points quickly

Best Beginner Credit Card Setup Ecosystem: Citi

If not American Express or Chase, what’s my recommendation?

The clear winner in this comparison is Citi.

More specifically, these three cards from Citi:

Citi Double Cash (2X unlimited everything)

Citi Custom Cash (5X highest spend ONE category)

Citi Strata Premier (3X flights, hotels, restaurants, groceries, gas, EV charging)

With this setup, your base earning is 2X on everything. In a Chase ecosystem, your base earning is 1.5X, and in American Express 1X (without business cards). That’s already a win!

On top of that, Citi gives you some of the best multipliers. It gives you 3X on a wide variety of common spending categories. No other ecosystem gives you 3X on travel, food, and gas, all at once. In that way, the Citi Strata Premier is quite unique.

The Citi Custom Cash is one of the most unique cards I have seen. It gives you 5X on your highest spend category, up to $500 every month. Yet another way to earn points super fast.

Finally, let’s talk about annual fees.

Citi Double Cash = $0

Citi Custom Cash = $0

Citi Strata Premier = $95

If you compare Citi’s setup to a comparable one from American Express or Chase, your total annual fees would be $1,020 and $95.

Chase comes close to Citi, however, the points-earning speed couldn’t be more different. With Citi, you earn points lightning fast. With Chase, you earn points the slowest (even American Express makes points earning easy).

Summary

So, for only $95 annually, you get the following benefit with a 3-card Citi setup:

Low annual fee

Points can be redeemed for both cashback and travel rewards

Great multipliers make points earning easy

Keeping all your points with one issuer makes it easy to manage bill payments

Citi cards can be difficult to get later on (after you have 5+ credit cards)

With all the reasons above, it’s easy to understand why Citi is clearly superior to both American Express and Chase when it comes to becoming your beginner credit card issuer.

Start with Citi Double Cash, then get the Citi Custom Cash, and finally the Citi Strata Premier.

Contact me if you want more details about a Citi setup or any other credit card setup recommendation.