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Some credit cards offer flat-rate cash back rewards — no matter what you buy, you get the same cash back percentage on every purchase. Some credit cards offer higher rewards for certain types of purchases. Travel credit cards, for example, give you better rewards when you spend on travel. Other credit cards offer their highest cash back percentages on rotating bonus categories that change every quarter. For instance, you might earn big rewards on restaurant spending in the first quarter of the year (January-March) and on Amazon.com purchases in the second quarter (April-June).
How do you maximize cash back on rotating bonus categories? With these credit cards, it’s all about knowing what type of spending gets rewarded, and planning your purchases to take advantage of these high-value rewards.
The most popular rotating cash back category cards
You might already have a rotating cash back category card in your wallet, but if you don’t, here’s a quick overview of the two most popular rotating bonus category cards:
Discover it® Cash Back
- Enroll every quarter to earn 5% cash back on up to $1,500 in purchases made in various categories throughout the year
- 1% cash back on all other spending, activation required
- Discover’s Cashback Match® will double all of the rewards you earn during your first year as a cardmember
- 0% APR for 14 months on purchases and balance transfers, followed by a 14.24%-25.24% variable APR
- No annual fee
- 5% cash back on bonus categories that rotate every quarter, for up to $1,500 in combined purchases per quarter
- 1% cash back on all other spending
- Earn up to 15% extra cash back when you Shop through Chase®
- $150 bonus cash back after spending $500 in your first three months as a card member
- 0% APR for 15 months on purchases and balance transfers, followed by a 17.24 – 25.99% variable APR
- No annual fee
Discover it® Cash Back
- January 1 – March 31: Gas stations and wholesale clubs
- April 1 – June 30: Grocery stores
- July 1- September 30: Restaurants
- October 1 – December 31: Amazon.com and wholesale clubs
- January 1 – March 31: Gas stations, internet/cable/phone services, Chase Pay®, Apple Pay®, Google Pay, Samsung Pay
- April 1 – June 30: Grocery stores (not including Walmart® and Target® purchases), PayPal, Chase Pay®
- July 1- September 30: Gas stations, Lyft, Walgreens
- October 1 – December 31: Department stores, wholesale clubs, and purchases made using Chase Pay®
What are the benefits of rotating bonus category credit cards?
The biggest benefit of rotating bonus category credit cards is the ability to earn high cash back rewards. The best cash back credit cards rarely offer the 5% cash back you’ll get with Chase Freedom® and Discover it® Cash Back, and credit cards that do offer high-level rewards often come with high annual fees.
The other benefit of rotating bonus category credit cards is the ability to plan your spending to take advantage of the bonuses. The Discover it® Cash Back card, for example, gets you a bonus cash back on Amazon purchases between October 1 and December 31 — perfect for your holiday shopping. If you’re thinking about doing some home improvement or stocking up on bulk groceries, you can plan to make those purchases during a quarter when you get 5% cash back.
What are the drawbacks?
The biggest drawback of rotating bonus category credit cards is having to keep track of which categories currently earn the bonus. If you get used to using your Chase Freedom® card at gas stations, for example, you might forget that you’re now in a quarter that rewards grocery spending instead.
Another big drawback? You have to activate your bonus categories. Before you can start earning 5% cash back, you have to log into your account and click a link that activates your bonus categories. (Both Discover and Chase will send you those links via email, but it’s still easy to forget to click them!) With the Chase Freedom® credit card, you earn bonus rewards from the first day of the quarter as long as you activate at some point during the quarter; with Discover it® Cash Back, you only earn bonus rewards starting on the day you activate. If you forget or procrastinate, you could be missing out on some big rewards.
Rotating bonus category credit cards also come with cash back limits — with both Chase and Discover, you only earn 5% cash back for up to $1,500 in purchases per quarter. If you’re a big restaurant spender, for example, you might be better served with a card like the Capital One® Savor® Cash Rewards Credit Card, which offers an unlimited 4% cash back on all restaurant and entertainment purchases.
How can you maximize your cash back with rotating bonus category credit cards?
If you want to maximize your cash back with rotating bonus category cards, start by keeping track of which categories earn a bonus. You could list your bonus categories on a sticky note in your wallet, or set a calendar reminder every time your quarterly bonuses change. A calendar reminder is also a good way to make sure you activate your bonuses!
Next, plan your spending to take advantage of your bonus categories. If you have the Discover it® Cash Back card, for example, you’ll want to do the majority of your holiday shopping at Amazon.com to get that 5% cash back.
Lastly, pair your rotating bonus category cash back card with an additional rewards credit card, so you can use your other rewards card for non-bonus purchases. Remember, both the Discover and Chase cash back cards get you 5% on bonus category purchases but only 1% cash back on everything else, so try and pair them with a card that gives you more than 1% back on your other regular high-spend categories.
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