Cashback cards and plastic offering 0 per cent interest can both save you money on Christmas purchases. Here is a round-up of the most rewarding credit cards available today.
Top rate Cashback cards
Capital One's World card and the American Express Platinum card top the cashback rate best buys, both offering an uncapped 1.25 per cent on your spending.
Those of you spending around £12,000 a year or more will be better off with the Capital One World Card, unless you spend large amounts on food or petrol (see below).
In addition, this card pays a bonus in the first three months of 5 per cent on up to £500 of spending, but beware that you get no more cashback in those three months once you reach that limit. It may therefore be worth holding back on big purchases.
The American Express Platinum Cashback Card also pays 1.25 per cent on all spending. There are no limits except during the first three months where you earn cashback only on the first £4,000.
However, you earn double cashback during the period, so 2.5 per cent. If you spend £10,000 in a year, you get double cashback in the anniversary month every year.
The £25 annual fee is worth it as you will still probably be £60 better off than with the Capital One card in most years, so long as you spend at least £10,000 a year. But bear in mind Amex is not as widely accepted as other cards.
Bonus cashback on petrol and food
Santander's 123 Cashback and the AA's Rewards Plus credit cards offer 3 per cent cashback when you spend money on fuel.
Santander's petrol limit is £300 each month (£3,600 a year). The AA pays 3 per cent on up to just £2,000 a year and then it pays 0.5 per cent thereafter.
The AA's deal also comes with 0.5 per cent on all other spending with no limit. The restrictions are you have to be a member of the AA and you must spend your cashback on AA products.
Santander's card charges a £24 annual fee but it also offers 1 per cent cashback on supermarket shopping and 2 per cent at many department stores, with no limit.
Some department stores, such as M&S, count as supermarkets, and some petrol stations count as supermarkets too. To find out how retailers in your area are classified by Santander, click here.
Look at cashback calculators on the Santander and AA websites to see which card will work out best for you.
The most straightforward of the petrol cards is the MBNA American Express Credit Card with Cashback, which pays 1.5 per cent on all petrol and supermarket spend and 0.75 per cent on all other purchases, in cash, with no maximum limits or annual fees.
Simple Cashback offers
For a flat rate on all your spending, Virgin Money's Charity card is the best. It offers 0.8 per cent cashback, beating Smile (0.25 per cent), Bank of Ireland (0.5 per cent) and Leeds Building Society (0.5 per cent).
The idea behind the card is that you are supposed to donate the cashback to charity, but Virgin Money lets you receive it once a year as a cheque if you prefer.
0 per cent credit cards
0 per cent on purchases cards can be another way to save money when paying for Christmas.
Spreading the cost of your purchases, interest free, with a new credit card deal means you can avoid paying potential interest on overdrafts or existing cards. This can also be a great way to leave any savings you earmarked for Christmas tucked away where they will be able to earn you interest for longer.
Chris Griffiths, credit card expert at Confused.com, says: “Zero per cent deals on credit cards are virtually always reserved for new customers, with the zero interest deal starting as soon as your account is opened.
"Remember to apply for your card in advance of when you need it for your shopping as it can take up to four weeks to receive your new plastic.
"Tesco offer a market leading 15 months 0 per cent that can also earn you clubcard points, meaning you can earn rewards as well as benefit from zero interest.”
If you’re not sure which cashback or 0 per cent card is right for you, try the Confused.com Card Matcher tool which can help show which card may be right for you.