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Pay your student loans with a credit card and earn rewards along the way

April 02, 2020
17 min read
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Whether you're a fairly recent graduate or decades out of school, chances are you're probably still paying off student loans. With Americans carrying more than $1.6 trillion in combined student loan debt, student loan payments are a pretty substantial monthly expense for a lot of people. And since it's almost impossible to discharge student loans like other debts, earning rewards on these payments is a small bit of relief.

If you're able to pay your student loans with a credit card and earn rewards, we're here to show you which cards are best for that.

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Best cards to pay your student loans

Comparing the best credit cards for student loan payments

Credit CardBest ForRewards RateAnnual feeWelcome bonus
Bank of America Premium Rewards credit cardFor Bank of America customers2 points per dollar on travel and dining.

1.5 points per dollar spent on all other purchases

$9550,000 bonus points after you make at least $3,000 in purchases in the first 90 days of account opening
Chase Freedom UnlimitedBest for those with a Ultimate Rewards-earning credit cardUnlimited 1.5% cash back$0Earn an additional 1.5% cash back on everything you buy (on up to $20,000 spent in the first year) - worth up to $300 cash back!
Blue Business Plus Credit Card from American ExpressBest business card for earning Membership Rewards2x points on the first $50,000 in purchases each calendar year

1x points thereafter

$0 (see rates and fees) Earn 15,000 points after spending $3,000 in the first 3 months of account opening
Capital One Venture Rewards Credit CardBest for flexible rewards2x miles per dollar on every purchase$9575,000 bonus miles after you spend $4,000 within the first three months from account opening
Citi Double Cash CardBest for flat-rate cash back2% cash back on every purchase with unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases$0None.
Amex Everyday Preferred Credit CardBest for frequent card users3x points on up to $6,000 spent annually at U.S. grocery stores

2x points at U.S. restaurants

1x points on all other spending

50% extra points when you use your card 30 or more times in a billing period.

$95Earn 15,000 Membership Rewards points after you spend $1,000 in your first three months
Capital One VentureOne Rewards Credit CardBest for earning Capital One Rewards with no annual feeEarn unlimited 1.25 miles per dollar on every purchase$0Earn 20,000 bonus miles after you spend $500 on purchases within the first three months

The information for the Amex EveryDay Preferred cards has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Related: Your guide to paying college tuition with a credit card

Bank of America Premium Rewards credit card

Annual Fee: $95

Sign-up bonus: 50,000 bonus points after you make at least $3,000 in purchases in the first 90 days of account opening

Reward rates: 2 points per dollar on travel and dining; 1.5 points per dollar spent on all other purchases.

Why we like it: The Bank of America Premium Rewards credit card is a great option for paying your student loans because it earns 1.5 points per dollar spent. If you're a Bank of America Premium Rewards member, you'll earn 25%-75% more bonus points, meaning your student loan payments could earn you up to 2.62 points per dollar spent. You can redeem points at a rate of one cent each, making the 50,000-point welcome bonus worth $500.

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While this card does carry a $95 annual fee, it's completely offset by an up to $100 airline incidental statement credit issued annually. Cardholders also qualify for a up to $100 Global Entry/TSA Precheck credit every four years, which is rare for a card with a $95 annual fee. Normally, credits like these are offered by cards with annual fees of $450 and up, which is why the Bank of America Premium Rewards Credit Card is so unique.

Read our review of the Bank of America Premium Rewards credit card.

APPLY HERE: Bank of America Premium Rewards credit card

Chase Freedom Unlimited

(Photo by Wyatt Smith/The Points Guy)
(Photo by Wyatt Smith/The Points Guy)

Annual Fee: $0

Sign-up bonus: Earn an additional 1.5% cash back on everything you buy (on up to $20,000 spent in the first year) - worth up to $300 cash back!

Rewards rates: Earn unlimited 1.5% cash back on purchases.

Why we like it: The Chase Freedom Unlimited is a great card for making student loan payments, especially if you have another Chase card that earns Ultimate Rewards points. The card has no annual fee and earns unlimited 1.5% cash back on purchases. If you have a card that earns Ultimate Rewards points, such as the Chase Sapphire Preferred Card, the Chase Sapphire Reserve or the Ink Business Preferred Credit Card, you can transfer your cash-back rewards to your Ultimate Rewards account for valuable redemption options. With no annual fee, having this card in your wallet is a no-brainer, and paying recurring expenses like your student loans can help you score a nice reward once you do pay off your student loans.

Read our review of the Chase Freedom Unlimited.

APPLY HERE: Chase Freedom Unlimited

Blue Business Plus Credit Card from American Express

Annual Fee: $0 (see rates and fees)

Welcome offer: Earn 15,000 points after spending $3,000 in the first 3 months of account opening

Rewards rates: 2x points on all spending, up to $50,000 per calendar year (then 1x)

Why we like it: If you're looking for maximum rewards on student loan payments, the Blue Business Plus card is an excellent choice. The card earns 2x points on all spending, up to $50,000 per calendar year (then 1x). The downside is that you may not be able to use an American Express card for student loan payments as readily as a card from one of the other major issuers. This is also a business card, and while you may qualify for a business card without realizing it, it's not ideal for everyone.

That being said, the card does not carry an annual fee and gets you access to Amex Offers. In the past, I've been able to earn bonus points and save hundreds of dollars on household bills using Amex Offers. While I have yet to see a student loan payment-centric offer from Amex, the money you save and the rewards you earn can go towards paying down your student loan balance even faster.

Read our review of the Blue Business Plus card.

APPLY HERE: Blue Business Plus Credit Card from American Express

Capital One Venture Rewards Credit Card

(Photo by Wyatt Smith/The Points Guy)

Annual Fee: $95

Sign-up bonus: Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening

Rewards rates: 2x miles per dollar on every purchase

Why we like it: With a simple reward structure, the Capital One Venture Rewards Credit Card earned its place on TPG's list of best travel credit cards. It's also a favorite of The Points Guy himself, Brian Kelly. The card earns 2x miles per dollar on everything, which is equivalent to 2% cash back when redeemed for travel purchases. You can also transfer miles to airline partners and hotel loyalty programs.

The high flat-rate earn rate and flexible redemption options makes the Capital One Venture Card a great option for student loan payments.

Read our review of the Capital One Venture Card.

APPLY HERE: Capital One Venture Card

Citi Double Cash Card

Annual Fee: $0

Sign-up bonus: None.

Rewards rates: Earn 2% cash back on every purchase — 1% when you buy and 1% when you pay your bill.

Why we like it: If you're looking for 2% cash back, and the ability to convert your rewards to ThankYou points at no annual fee, look no further than the Citi Double Cash Card. The card earns 2% cash back on all purchases — 1% when you make a purchase and another 1% when you pay your card off every month. That's not only a great incentive to pay off your balance (something you should be doing regardless), but 2% is also a solid payout if you're looking to earn cash back on your student loan payments.

What's better than 2% cash back on your student loan payments? Two Citi ThankYou points per dollar spent. If you have a card in your wallet that earns Citi ThankYou points, you can convert your cash back rewards from the Citi Double Cash Card to Citi ThankYou points. The Citi Premier® Card or Citi Prestige® Card are both qualifying cards that enable you to do this. Since TPG values ThankYou points at 1.8 cents each, this card effectively earns 3.6% in rewards when converted to points.

The information for the Citi Prestige cards has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Read our review of the Citi Double Cash Card.

APPLY HERE: Citi Double Cash Card

Amex Everyday Preferred Credit Card

(Photo by The Points Guy)
(Photo by The Points Guy)

Annual Fee: $95

Welcome offer: Earn 15,000 Membership Rewards points after you spend $1,000 in your first three months

Rewards rates: 3x points on up to $6,000 spent annually at U.S. grocery stores, 2x points at U.S. restaurants, 1x points on all other spending, 50% extra points when you use your card 30 or more times in a billing period.

Why we like it: On first sight, the Amex Everyday Preferred card doesn't seem like a great option for student loan payments. The card earns just 1 point per dollar on non-bonus category spending and carries a $95 annual fee. However, if you make at least 30 purchases in a billing cycle, you'll earn 50% bonus points. That can add up substantially, especially on large payments.

A great incentive for making those 30 purchases is the card's earning rate. Cardholders earn 3x points per dollar on up to $6,000 per year at U.S. supermarkets and 2x points at U.S. gas stations. Plus, you'll have access to Amex Offers, providing plenty of opportunity for you to save on those essential purchases and pay off your student loan balance faster.

Read our review of the Amex Everyday Preferred card.

Capital One VentureOne Rewards Credit Card

(Photo by The Points Guy)
(Photo by The Points Guy)

Annual Fee: $0

Sign-up bonus: Earn 20,000 bonus miles after you spend $500 on purchases within the first three months

Rewards rates: Earn unlimited 1.25 miles per dollar on every purchase

Why we like it: If you're looking to earn Capital One rewards on your student loan payments without an annual fee, the Capital One VentureOne Rewards Credit Card is a great option. The card earns a flat 1.25 miles per dollar spent on all purchases. Not many rewards cards with no annual fee offer a sign-up bonus, which makes the 20,000 bonus miles offered by this card unique. You can redeem these miles for $200 in travel purchases or transfer them to an airline or hotel partner for even better value.

Read our review of the Capital One VentureOne card.

APPLY HERE: Capital One VentureOne Rewards Credit Card

Can I pay my federal student loan with a credit card?

If you have student loans with Sallie Mae, you can pay them over the phone using a credit card. The only downside to be aware of is that they don't accept American Express cards and there's a possibility that your purchases might get coded as a cash advance and incur a fee. One TPG reader had success charging a student loan payment to her Chase Sapphire Preferred without incurring a cash advance fee.

If you're concerned about cash advance fees, try making a small payment first. If it gets coded like a regular purchase, you can proceed with a larger payment. On the other hand, if it does generate a fee, at least it won't be significant, assuming your payment was small.

Another option for paying your federal student loans with a credit card is to do it through a third-party payment service such as Plastiq. The site accepts all major card issuers, but imposes fees of up to 2.5% on credit card payments. You can save on payment fees by signing up with a referral link and referring other friends. The Fee-Free Dollars (FFDs) earned from these referrals will minimize your out-of-pocket cost so you can really benefit from the rewards you're earning.

Paying federal student loans with a credit card is a great option if you're trying to meet credit card spending requirements and have limited options. In that case, it might even make sense to incur a small fee in order to earn a substantial credit card sign-up bonus.

Benefits of using your credit card for your student loans

A major benefit of using your credit card for student loan payments is earning rewards. With the average student carrying $32,731 in student loan debt, according to Forbes, that is a significant expense you could be putting to work for your benefit. For example, paying a balance that large with a 2% cash-back card would earn you about $654 in cash back. Charge that amount to the Blue Business Plus Credit Card from American Express and you'll have 65,462 Membership Rewards points, worth $1,309 according to TPG valuations, that you can put to good use.

Related: Paying College Tuition on a Credit Card: Fees vs. Rewards

Bottom line

Picking the right card to pay your student loans depends on several factors. For starters, you'll need to find out whether your student loan company accepts credit cards and what the terms are. Some merchants charge higher fees for American Express payments. If that's the case, your choices are narrowed down further. It's also important to find out from your bank whether student loan payments will be coded as cash advances. Payments to financial institutions sometimes get coded this way, which could result in big fees that offset any rewards earned.

Lastly, consider the rewards you'll earn by paying your student loans with a credit card. It might make sense for you to charge these payments to a 2% cash-back card for extra savings. If you're trying to spend your way to elite status, an annual free night or a big sign-up bonus, it might make sense to opt for a card that earns fewer points but gets you closer to a big reward.

Related Reading: Paying college tuition on a credit card: Fees vs. rewards

Related guides

For rates and fees of Blue Business Plus card, please click here.

Updated on 5/3/21.

Featured image by Getty Images/iStockphoto
Editorial disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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How we chose these cards

Our points-obsessed staff uses a plethora of credit cards on a daily basis. If anyone on our team wouldn’t recommend it to a friend or a family member, we wouldn’t recommend it on The Points Guy either. Our opinions are our own, and have not been reviewed, approved, or endorsed by our advertising partners.
See all best card offers

TPG featured card

Best premium travel card for value
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards

1 - 10X points
10xEarn 10x total points on hotels and car rentals when you purchase travel through Chase Ultimate Rewards®.
5xEarn 5x total points on flights through Chase Ultimate Rewards®.
3xEarn 3x points on other travel and dining.
1xEarn 1 point per $1 spent on all other purchases

Intro offer

80,000 bonus points
Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,200 toward travel when you redeem through Chase Ultimate Rewards®

Annual Fee

$550

Recommended Credit

740-850
Excellent
Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

Why We Chose It

If you are looking to take your premium rewards to the highest level, this card is really a no brainer in our eyes. Chase's Ultimate Rewards make points easy to redeem, with a wide range of 10 airline and three hotel transfer partners and a friendly user interface. Despite the high annual fee, Chase is consistently adding new benefits to keep the card competitive in a fierce premium rewards field.

Pros

  • $300 annual travel credit as reimbursement for travel purchases charged to your card each account anniversary year
  • Access to Chase Ultimate Rewards hotel and airline travel partners
  • Unlimited 3x points on the broad category of travel and dining
  • 50% more value when you redeem your points for travel through Chase Ultimate Rewards®
  • Broad definitions for travel and dining bonus categories

Cons

  • Steep $550 annual fee
  • May not make sense for people that don't travel frequently
  • You must spend the $300 travel credit before earning 3x points for travel and dining
  • No automatic hotel elite status
  • Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,200 toward travel when you redeem through Chase Ultimate Rewards®
  • $300 Annual Travel Credit as reimbursement for travel purchases charged to your card each account anniversary year.
  • Earn 5x total points on flights and 10x total points on hotels and car rentals when you purchase travel through Chase Ultimate Rewards® immediately after the first $300 is spent on travel purchases annually. Earn 3x points on other travel and dining & 1 point per $1 spent on all other purchases
  • Get 50% more value when you redeem your points for travel through Chase Ultimate Rewards®. For example, 80,000 points are worth $1,200 toward travel
  • 1:1 point transfer to leading airline and hotel loyalty programs
  • Access to 1,300+ airport lounges worldwide after an easy, one-time enrollment in Priority Pass™ Select and up to $100 application fee credit every four years for Global Entry, NEXUS, or TSA PreCheck®
  • Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more
Best premium travel card for value
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards Rate

10xEarn 10x total points on hotels and car rentals when you purchase travel through Chase Ultimate Rewards®.
5xEarn 5x total points on flights through Chase Ultimate Rewards®.
3xEarn 3x points on other travel and dining.
1xEarn 1 point per $1 spent on all other purchases
  • Intro Offer
    Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,200 toward travel when you redeem through Chase Ultimate Rewards®

    80,000 bonus points
  • Annual Fee

    $550
  • Recommended Credit
    Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

    740-850
    Excellent

Why We Chose It

If you are looking to take your premium rewards to the highest level, this card is really a no brainer in our eyes. Chase's Ultimate Rewards make points easy to redeem, with a wide range of 10 airline and three hotel transfer partners and a friendly user interface. Despite the high annual fee, Chase is consistently adding new benefits to keep the card competitive in a fierce premium rewards field.

Pros

  • $300 annual travel credit as reimbursement for travel purchases charged to your card each account anniversary year
  • Access to Chase Ultimate Rewards hotel and airline travel partners
  • Unlimited 3x points on the broad category of travel and dining
  • 50% more value when you redeem your points for travel through Chase Ultimate Rewards®
  • Broad definitions for travel and dining bonus categories

Cons

  • Steep $550 annual fee
  • May not make sense for people that don't travel frequently
  • You must spend the $300 travel credit before earning 3x points for travel and dining
  • No automatic hotel elite status
  • Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,200 toward travel when you redeem through Chase Ultimate Rewards®
  • $300 Annual Travel Credit as reimbursement for travel purchases charged to your card each account anniversary year.
  • Earn 5x total points on flights and 10x total points on hotels and car rentals when you purchase travel through Chase Ultimate Rewards® immediately after the first $300 is spent on travel purchases annually. Earn 3x points on other travel and dining & 1 point per $1 spent on all other purchases
  • Get 50% more value when you redeem your points for travel through Chase Ultimate Rewards®. For example, 80,000 points are worth $1,200 toward travel
  • 1:1 point transfer to leading airline and hotel loyalty programs
  • Access to 1,300+ airport lounges worldwide after an easy, one-time enrollment in Priority Pass™ Select and up to $100 application fee credit every four years for Global Entry, NEXUS, or TSA PreCheck®
  • Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more