Some of the offers on this page may have expired.
The information about the Alliant Cashback Visa® Signature Credit Card, Capital One Savor Cash Rewards Credit Card, and Wells Fargo Cash Wise Visa® card has been collected independently by Bankrate.com. The card details have not been reviewed or approved by the card issuer.
Bankrate helps you cash in on cash back credit cards
Looking to earn cash back on credit card purchases? We can help you pick the right card for it. Before you make your decision, take a look at what you need to know about cash back credit cards.
Bankrate’s top picks for best cash back credit cards
A closer look at our top cash back card selections
Citi® Double Cash Card
Why it’s the best cash back card for no annual fee
- 2 percent on every purchase – unlimited 1 percent cash back when you buy, plus an additional 1 percent as you pay for those purchases.
- 18-month 0% introductory APR offer on balance transfers (13.99% – 23.99% variable APR thereafter)
- The Lost Wallet® Service will replace your lost card within 24 hours
- No annual fee
This card isn’t for you if: you spend a lot in one or two particular categories, such as groceries or dining. If that sounds like you, you’re probably better off with a card that rewards spending in a category of your choice at a higher rate.
Bottom line: The Double Cash card is a great tool for practicing healthy card habits due to its 1 percent cash back incentive after paying off a purchase. Simple and lucrative, this card is great for those looking for an option that involves minimal upkeep.
Read our Citi® Double Cash Card Review.
Chase Freedom Unlimited®
Why it’s the best cash back card for sign-up bonus
- You’ll earn $200 when you spend $500 on your card within 3 months of account opening
- Earn 5% on travel purchased through Chase, 3% on dining at restaurants and drugstores, and 1.5% on all other purchases.
- Redeem for cash back, travel, gift cards or shop with points on Amazon.com
This card isn’t for you if: You’re a frequent international traveler hoping to use this card abroad. Outside of the U.S. or online with foreign merchants, you’ll be charged a 3% foreign transaction fee on every purchase.
Bottom line: The Freedom Unlimited is a solid no annual fee cash back card with a simple rewards structure and an easily-attainable sign-up bonus.
Read our Chase Freedom Unlimited Review.
Capital One Quicksilver Cash Rewards Credit Card
Why it’s best for your first cash back card
- Earn 1.5% cash back on all purchases with no limit on how much cash back you can earn
- $200 sign-up bonus when you spend $500 in your first three months
- 15-month 0% introductory offer on purchases (15.49%-25.49% variable APR thereafter)
- No annual fee
This card isn’t for you if: You’re looking for a high-earning cash back card.
Bottom line: The Quicksilver from Capital One is a great starter cash back card for earning rewards on everyday purchases.
Read our Capital One Quicksilver Cash Rewards Credit Card Review.
Chase Freedom Flex
Why it’s best for cash back in multiple categories
- 5 percent cash back on travel purchased through Chase Ultimate Rewards
- 3 percent cash back on drugstore purchases and at restaurants, including takeout and eligible delivery services
- Earn 5 percent in Chase rotating bonus categories on up to $1,500 in purchases per quarter (activation required)
- No annual fee
This card isn’t for you if: You already have a no-annual-fee cash back card geared toward food shopping, such as the Blue Cash Everyday Card from American Express, with permanent high rates in that category.
Bottom line: If your spending habits match up with the high-rate categories, the Chase Freedom Flex could be one of your top options for a cash back card.
Read our Chase Freedom Flex Review.
Capital One SavorOne Cash Rewards Credit Card
Why it’s best for dining and entertainment with no annual fee
- Unlimited 3 percent cash back on dining and entertainment, 2 percent on grocery stores (excluding superstores like Walmart® and Target®) and 1 percent on everything else
- Earn $200 cash bonus when you spend $500 in your first three months
- 15-month 0% introductory APR offer on purchases(15.49% – 25.49% variable APR thereafter)
- No foreign transaction fees
- No annual fee
This card isn’t for you if: You don’t regularly spend on entertainment and dining out.
Bottom line: The SavorOne is a handy no-annual-fee card for earning unlimited cash back on entertainment and dining.
Read our Capital One SavorOne Cash Rewards Credit Card Review.
Blue Cash Everyday® Card from American Express
Why it’s the best no-annual-fee cash back card for families
- Earn 3 percent cash back at U.S. supermarkets on your first $6,000 in purchases per year, 1 percent back after that
- Unlimited 2 percent cash back at U.S. gas stations and select U.S. department stores
- 1 percent cash back on all other purchases
- Earn a $200 statement credit after you spend $1,000 in purchases on your new Card within the first 3 months
- No annual fee
- Terms apply
This card isn’t for you if: You plan to use it abroad. The card carries a foreign transaction fee (see rates and fees) of 2.7 percent, so it’s not the best choice if you regularly travel overseas or make online purchases from international vendors.
Bottom line: The Blue Cash Everyday Card offers impressive cash back rates at U.S. supermarkets, U.S. gas stations and select U.S. department stores, all without charging an annual fee. It’s a smart pick for budget-conscious families.
Read our Blue Cash Everyday® Card from American Express Review.
American Express Cash Magnet® Card
Why it’s the best card for cash back with payment flexibility
- Earn unlimited 1.5% cash back on all eligible purchases
- The Plan It® feature lets you split up large purchases over time with a fixed monthly fee, while Pay It® lets you quickly pay off small purchase amounts while still earning rewards
- No annual fee
- Welcome offer is $150 statement credit after you spend $1,000 in the first 3 months
- Terms apply
This card isn’t for you if: You want higher cash back rates in specialized categories, such as gas or groceries.
Bottom line: This card gives you the opportunity to earn cash back at a steady rate and enjoy greater flexibility in managing your balance.
Read our American Express Cash Magnet® Card Review.
Blue Cash Preferred® Card from American Express
Why it’s the best overall cash back card for families
- 6 percent cash back at U.S. supermarkets (on up to $6,000 annually and 1 percent after) and 3 percent cash back at U.S. gas stations
- 6 percent cash back on select U.S. streaming services, 3 percent cash back on transit and 1 percent cash back on everything else
- Earn a $250 statement credit after you spend $1,000 in purchases on your new Card within the first 3 months
- A variety of travel, entertainment and shopping perks
- Terms apply
This card isn’t for you if: You don’t spend a lot at U.S. supermarkets and U.S. gas stations, or on select U.S. streaming services. These spending categories are the key to maximizing the card’s value and offsetting the $95 annual fee.
Bottom line: You can earn outstanding cash back rewards with this card for feeding your family members and filling up your family vehicles. The select U.S. streaming service category is also great for families who get their TV entertainment online.
Read our Blue Cash Preferred® Card from American Express Review.
Capital One QuicksilverOne Cash Rewards Credit Card
Why it’s the best cash back card for fair credit
- The card earns 1.5 percent cash back unlimited on all eligible purchases.
- You can automatically be considered for a higher credit line in as little as 6 months.
- You can apply with a Fair to Good credit score (580-740 FICO)
This card isn’t for you if: You don’t commit to using it responsibly. You’ll need to pay your balance in full and on time or face 26.99 percent variable APR. Making unpaid balances a habit could also affect your eligibility for a higher credit line.
Bottom line: This card could help you move your credit score into the Good range and earn cash back rewards in the process, but responsible behavior on your part is essential.
Read our Capital One QuicksilverOne Cash Rewards Credit Card Review.
Petal® 2 “Cash Back, No Fees” Visa® Credit Card
Why it’s the best cash back card for no credit history
- You earn 1 percent cash back on purchases, and the rate could go as high as 1.5 percent after you make 12 on-time monthly payments
- Exclusive offers earn 2 percent to 10 percent cash back at select local merchants
- No annual fee, no foreign transaction fee, no late fees and no returned payment fees
- No credit history needed to apply
This card isn’t for you if: you’ve already started building a solid credit history. The ideal Petal 2 cardholder is a college student or young adult just starting on their personal finance journey.
Bottom line: The Petal 2 card could be a useful way for a new credit card user to learn the ropes. The chance to earn higher cash back rates after 12 on-time payments provides incentive to develop good credit habits.
Read our Petal® 2 “Cash Back, No Fees” Visa® Credit Card review.
Capital One Spark Cash for Business
Why it’s the best cash back card for small businesses
- Earn unlimited 2 percent cash back
- Free employee cards and customizable spending limits
- Free year-end spending summaries to simplify taxes
- No foreign transaction fee
This card isn’t for you if: You won’t pay your balance in full each month. The APR is high compared with other business cards, so you could easily end up paying far more in interest than you earn in rewards cash.
Bottom line: A rewards rate of 2 percent cash back on all purchases is pretty great, especially when applied to costly business expenses. Small business owners who use the Spark Cash as their primary payment method will easily find value in this card, both for the cash back and additional business perks.
Read our Capital One Spark Cash for Business.
Bank of America® Cash Rewards credit card
Why it’s the best cash back card for choice of rewards category
- Bank of America Preferred Rewards members can earn 25% – 75% more cash back on every purchase, adding value to an already robust rewards program.
- Having the choice of six categories for 3% cash back (travel, gas, online shopping, dining, drug stores and home improvement/furnishings on the first $2,500 in combined 2% and 3% category purchases each quarter) provides a ton of flexibility for earning rewards. You also get unlimited 1% cash back on all other purchases.
- 0% intro APR offers for 12 billing cycles for purchases, and for any balance transfers made in the first 60 days (13.99% – 23.99% variable APR after offers expire). A 3% fee (min $10) applies to all balance transfers.
- The sign-up bonus — $200 in online cash rewards after you make $1,000 in purchases during the first 90 days — is easily obtainable.
This card isn’t for you if: Your spending habits don’t align with the quarterly earning limits. The $2,500 cap on combined spending for your 3% choice category and the 2% grocery store and wholesale club category could limit the earning potential of big-time grocery shoppers.
Bottom line: The banking bonuses help make this card an attractive companion for BofA account holders who make a fair amount of household-oriented purchases.
The Bank of America® Cash Rewards credit card information was last updated on 01.12.2021.
Read our Bank of America® Cash Rewards credit card Review.
Wells Fargo Cash Wise Visa® card
Why it’s the best cash back card for digital wallet users
- The normal 1.5 percent cash rewards rate rises to 1.8 percent on qualified digital wallet purchases (including Google Pay™ and Apple Pay®) during the first 12 months you own the card.
- Pay your monthly cellular phone bill with the card and get up to $600 protection on your cellphone against covered damage or theft (a $25 deductible applies).
- Spend $500 in your first three months and earn a $150 cash rewards bonus.
- No annual fee
This card isn’t for you if: You’re not a frequent digital wallet user, or you want a cash back card with a higher rewards rate.
Bottom line: The first-year digital wallet bonus of 1.8% on qualified purchases and the cellphone protection offer make the Wells Fargo Cash Wise Visa card an interesting option for phone-first consumers looking to earn cash back rewards.
The information about the Wells Fargo Cash Wise Visa® card has been collected independently by Bankrate.com. The card details have not been reviewed or approved by the card issuer.
Read our Wells Fargo Cash Wise Visa® Card Review.
Discover it® Cash Back
Why it’s the best card for rotating cash back categories
- When you activate the bonus categories each quarter, you earn 5 percent cash back on rotating category purchases (up to $1,500 a quarter and 1 percent thereafter).
- Outside the bonus category purchases, you earn unlimited 1 percent cash back.
- You can plan your spending patterns for the next quarter (and beyond) by checking Discover’s cash back calendar.
This card isn’t for you if: You don’t commit to activating the bonus categories each quarter. For cash back that flies on autopilot, consider a flat-rate card.
Bottom line: The Discover it Cash Back has considerable earning potential. Just remember to track the rotating categories and activate each quarter.
Read our Discover it® Cash Back Review.
Capital One Savor Cash Rewards Credit Card
Why it’s best cash back card for dining and entertainment
- Get an unlimited 4% cash back on dining and entertainment, 2% at grocery stores and 1% on everything else
- $300 cash bonus when you spend $3,000 in your first three months
- No foreign transaction fees
This card isn’t for you if: You don’t get out often, for dining, movies, concerts, etc.
Bottom line: As the sibling to the SavorOne, the Savor card is a stellar way to earn a high level of cash back rewards on your dining and entertainment purchases.
Read our Capital One Savor Cash Rewards Credit Card Review.
What is a cash back credit card?
Just as the name says, cash back cards reward you for eligible purchases by giving you a percent of your purchase price back. For example, a 3 percent cash back rate means you earn 3 cents back for every dollar in eligible spending. For a cardholder with a $4,000 annual grocery bill, earning 3% at the supermarket could mean up to $120 in cash back rewards.
Cash back is essentially a discount on eligible purchases. You may not see it immediately at the register, but the payoff comes when you redeem your rewards.
Cash back cards are different from other types of rewards cards, like those that offer points or miles for travel purchases. Instead of complicated redemption programs, a cash back card typically offers a few simple ways to redeem your rewards, including:
- Statement credits
- Checks payable to you
- Direct deposits into one of your bank accounts
- Gift cards
Are cash back credit cards worth it?
As with any credit card, there are a number of factors that affect the value you get. To determine whether a cash back card is worth it for you, you need to compare the potential earnings to the costs, like an annual fee or interest charges. However, if you think you’ll be carrying a balance from month to month you should consider a low interest credit card instead of a cash back card.
If you’re looking at a cash back card with no annual fee and you plan to pay your balance in full each month, it’s probably going to be worth getting because you will have little to no offsetting costs. If the card does have an annual fee, a simple calculation can determine whether the annual fee is worth it.
We’ll use the Blue Cash Preferred® Card from American Express as an example. Say you go to the supermarket every Sunday, spending about $100 – that’s $5,200 annually. Using your Blue Cash Preferred, you would earn 6% cash back at U.S. supermarkets (on up to $6,000 in purchases annually, then 1%), which would total $312 for the year. Subtracting the card’s $95 annual fee, your bottom line would end up being $217 in cash back earnings for the year. And that doesn’t even include the cash back you could earn in the card’s other bonus categories (6% on select U.S. streaming subscriptions 3% on transit and 3% at U.S. gas stations).
$5,200 x 6% (0.06) = $312
$312 – $95 (annual fee) = $217
In this case, the cash back card would be worth getting, even with the annual fee. Once you’ve found a few cards that you like, try out this calculation using your own spending habits to determine which card is going to give you the most value.
Types of cash back credit card rewards
Cash back cards come in a variety of forms. Flat-rate cash back cards, for example, give you the same rewards rate on every purchase. Cards with rotating categories or tiered cash back cards have categories that offer more cash back within certain spending groups (such as restaurants and gas stations).
Cards like the Discover it® Cash Back have rotating bonus categories that take a bit of effort to navigate in part because of the required quarterly sign-up. But with these cards, you’ll have the chance to earn a high level of rewards in a variety of categories throughout the year. With tiered rewards, you earn a set amount year-round for specific categories, such as 6% at U.S. supermarkets (on up to $6,000 annually, then 1%) with the Blue Cash Preferred® Card from American Express.
When deciding which type of cash back card is best for you, it’s important to know all of the options available to you.
Flat-rate cash back cards offer the same rewards rate for each eligible purchase. These cards are great for those who aren’t keen on activating and tracking bonus categories each quarter.
A great choice: the Citi® Double Cash Card, which offers 2 percent on every purchase — unlimited 1 percent cash back when you buy, plus an additional 1 percent as you pay for those purchases.
Tiered cash back cards offer different rates of cash back for different types of purchases. For example, a tiered card may offer a boosted cash back rate of 3 percent on restaurant purchases, while all other purchases are rewarded with 1 percent cash back. The best way to maximize your cash back earnings is to have several tiered cards that reward your most common purchases at a high rate. That way, you can spend strategically and make sure you’re earning cash back at a boosted rate as often as possible.
A great choice: the Chase Freedom Unlimited®. Cardholders enjoy 5 percent cash back on travel purchased through Chase Ultimate Rewards, 5 percent cash back on Lyft purchases (through March 2022), 3 percent cash back on dining, 3 percent cash back on drugstore purchases and 1.5 percent cash back on all other purchases.
Rotating bonus categories
With rotating categories, you’ll often get higher rewards rates, but a majority of these cards require enrollment in order to receive cash back in the category. This can be a problem for forgetful cardholders. Normally, if you forget to enroll, the issuer defaults your earnings in that category to 1 percent cash back. You should also take category caps into consideration. Cards with rotating bonus categories tend to set spending limits on how much you can earn in high rewards categories.
A great choice: the Discover it® Cash Back, which offers 5 percent cash back on rotating categories each quarter when you activate and enroll (on up to $1,500 in purchases per quarter, then unlimited 1 percent).
What is the highest-paying cash back credit card?
Consumers can choose from hundreds of cash back credit cards that reward purchases ranging from the general (1 percent back on all eligible purchases) to the specific (6 percent back on select U.S. streaming services). Each one puts money back in your wallet, but which credit card pays you the most cash back?
The answer depends on a lot of factors, but two cards that definitely belong in the conversation are the Blue Cash Preferred Card from American Express and the Alliant Cashback Visa® Signature Credit Card . Ultimately, your spending habits determine which card is going to work hardest for you.
A closer look at the Blue Cash Preferred
Here’s a breakdown of the card’s cash back potential.
Rewards rates and categories
- 6% cash back at U.S. supermarkets (up to $6,000 annually, then 1%)
- 6% cash back on select U.S. streaming services
- 3% cash back on transit (including rideshares, tolls, taxis and buses)
- 3% cash back at U.S. gas stations
- 1% on everything else
- Terms apply
- $6,000 at U.S. supermarkets per year, then 1%
Definitions and exceptions
American Express defines “supermarkets” quite narrowly. Merchants not included in the category include superstores (such as Target), warehouse clubs (such as Sam’s Club) specialty stores (such as wine shops) and convenience stores. Eligible purchases at non-supermarket establishments earn 1 percent cash back, not 6 percent.
How much could you earn with Blue Cash Preferred?
If you max out the U.S. supermarkets category, you’ll earn $360 per year (6 percent of $6,000). However, bear in mind that you’ll continue to earn for U.S. supermarket purchases, at 1 percent unlimited, after you hit the $6,000 limit.
You’ll also earn unlimited cash back in four other categories: 6 percent on select U.S. streaming services, 3 percent on transit, 3 percent at U.S. gas stations and 1 percent on other eligible purchases.
The $360 per year from maxing out the U.S. supermarkets category could be just the beginning, given the earning potential in the remaining categories. Families that spend a lot at supermarkets and gas stations could easily see several hundred dollars in cash back every year.
A closer look at the Alliant Cashback Visa
While most flat-rate cash back cards earn 1, 1.5 or 2 percent, the Alliant Visa Signature card rewards a whopping 2.5 percent on all purchases (on up to $10,000 in purchases per billing cycle). Plus, your first year of membership has an especially high earning potential since the $99 annual fee is waived.
Rewards rates and categories
- 2.5% cash back on all purchases (on up to $10,000 in qualifying purchases per billing cycle)
- $10,000 (equal to $250 in cash back) per billing cycle
Definitions and exceptions
In order to qualify for the Alliant Visa Signature, you have to either live in one of the Illinois communities Alliant serves, be a relative of an existing Alliant member, or have a membership in select organizations you can find on their site. However, if none of the requirements apply to you, a $10 minimum donation to Foster Care to Success will also qualify you for membership.
- $99 annual fee (waived first year)
How much could you earn with the Alliant Cashback Visa?
The rewards rate is 25 percent higher than a typical 2 percent cash back card, so big spenders can see substantial cash back earnings. One potential problem is the annual fee, which is waived for the first year. If you don’t spend at least $3,960 annually on this card, you’ll actually lose money by owning it. That is, your cash back earnings won’t make up the cost of the annual fee until you spend $3,960 ($3960 x 2.5% = $99). Plenty of people spend well over that amount annually on credit cards, so it’s just a matter of taking a good look at your budget to get an estimate of your earnings with this card, rather than a cash back card with no annual fee.
Honorable mention: Discover’s first-year phenoms
No discussion of high-earning cash back cards would be complete without mentioning Discover. The discussion just needs to include an asterisk with the notation “year one.”
Discover offers several cash back cards with the Cashback Match™ feature. You can see your initial earnings effectively double when Discover matches all the cash back you’ve earned at the end of your first year.
Take the Discover it Cash Back as an example. If you activate and max out your spending in the rotating bonus categories (5 percent up to $1,500 on purchases each quarter, then 1 percent), your yearly earnings in those categories alone would reach $300. Add the Cashback Match and you’d have $600 cash back in bonus categories at the end of your first year.
Bear in mind, that $600 figure doesn’t include the 1 percent you would continue to earn after hitting the $1,500 quarterly limit or the unlimited 1 percent for non-category purchases. One catch: the Cashback Match applies only to your first year as a cardholder.
The other catch is that to continue earning at least $300 per year in the bonus categories afterward, you’d need to keep adjusting your spending patterns to align with the rotating categories and keep remembering to activate each quarter. In other words, the discipline required to maximize your rewards with any rotating category card gives “earning cash back” a double meaning.
Still, the overall quality of Discover’s cash back cards makes each one an attractive option even after the Cashback Match is a distant memory.
How to choose a cash back credit card
Review your spending for the past few months to see which categories you purchased the most in, and make sure to have your credit score handy to know which cards you have a chance at being approved for.
A busy family of four would most likely benefit more from a card that offers greater rewards on gas and groceries, such as the 6% cash back at U.S. supermarkets (on up to $6,000 annually, then 1%) and 3% at U.S. gas stations offered by the Blue Cash Preferred® Card from American Express, than a cash back card focused on travel.
If you can’t pinpoint an area where you spend the most in, go with a general-purpose cash back card that will get you earn rewards on most any kind of eligible purchase.
Pros of owning a cash back card:
- Most cash back cards offer an unlimited 1% cash back on purchases outside of bonus categories.
- Many offer cash back bonuses for hitting certain spending requirements within a time period.
- You can normally redeem your cash back for things like merchandise, airfare, hotel stays, statement credits and more.
Cons of owning a cash back card:
- Some cards require enrollment to receive a high level of cash back each quarter.
- It’s not unusual for issuers to put a cap on how much you can earn within higher rewards categories.
- You may have trouble maxing out your bonus categories if they aren’t relevant to your lifestyle.
What you should consider before getting a cash back credit card
With a cash back card, the amount you accrue is simple and easy to follow — it’s essentially a rebate on everything you spend. However, owning any kind of credit card means being aware of some potential pitfalls.
Cash Back rewards terminology
Like any type of credit card, cash back cards play by a certain set of rules. To know how much they pay, you’ll first need to figure out how they pay.
- Rewards rate. The percentage of cash back returned to you for every $1 spent on qualifying purchases
- Categories: The types of purchases that qualify for cash back rewards
- Spending limit. The point where the cardholder maxes out his or her cash back earnings
- Definitions and exceptions. Terms that spell out which purchases qualify for cash back, which applies in part to bonus categories
- Offsetting costs. Usually an annual fee or a foreign transaction fee
APR that cancels out rewards
When you run a large balance on your credit card, APR (annual percentage rate) could cancel out the rewards you’ve earned.
As long as you consistently pay off your balance each month, you can avoid paying these interest charges. But if you tend to carry a balance, your top priority when researching cash back cards should be looking for cards that offer lower APR or a pass on your first late payment.
Overspending for a bonus
Many cards offer sign-up bonuses that require you to spend a specific amount of money within a specific time-frame. You might feel tempted to sign up for a card just for the welcome offer, but be careful. By acting impulsively, you could overspend to qualify for the offer and end up carrying a balance.
Make sure the spending requirement is in line with how much you normally spend with a credit card. Running up a balance you can’t pay off in time could subject you to high APR, potentially making the sign-up bonus a net loss.
Survey: Many cash back cardholders leave money on the table
Every time you pay by cash or debit instead of reaching for your cash back credit card, you could be missing out on an opportunity to literally put money in your pocket.
Bankrate.com conducted a survey about the preferred payment methods of rewards credit cardholders, including cash back cards, who pay their bills in full each month. The results found that 55 percent of this group are missing out on rewards due to paying with cash or a debit card when they could be using their rewards credit card instead.
Taking advantage of your cash back rewards is not as complicated as you may think, and the benefit of extra cash means that using your cash back card every time you swipe, tap or buy online might be well worth it.
Cash back rewards you could be earning
The survey looked at consumers’ preferred payment methods for purchases in four major categories: groceries, dining, gas and travel. Using the Citi® Double Cash Card as an example, the researchers estimated how much cash back you could earn in a year if you made these purchases with that card exclusively rather than cash or a debit card.
The Citi Double Cash earns 2 percent cash back on every purchase — 1 percent when you buy and 1 percent as you make payments for those purchases. Based on that earning rate, a cardholder who pays their balance on time and in full every month could expect these earnings if they spent the national average* in those four categories:
Example: Citi Double Cash Card
*As determined by the U.S. Bureau of Labor Statistics, 2018
The study also finds that many rewards cardholders who don’t carry a monthly balance fail to use their cards to pay for purchases that could be earning rewards.
According to the data compiled by Bankrate, 44 percent of rewards cardholders who don’t carry a balance from month to month pay for their groceries with cash or a debit card. A consumer in that group who owns a Citi Double Cash Card could be missing out on $89 — possibly more or possibly less, depending on their spending habits — in cash back on groceries alone each year.
||Paid with debit card/cash
How to maximize cash back
Let’s break down how you can get the most out of your cash back credit cards.
Enroll/activate your bonus categories each quarter
Rotating category cards typically require you to enroll or activate (the language varies) the bonus categories for the upcoming quarter to earn the higher bonus rate. If you don’t, you’ll earn the standard rate.
Target your spending
In order to get the most out of a bonus category, try to max out the spending limit for the quarter. Depending on the card, it could be in the neighborhood of $3,000. After you reach the limit, the rewards rate typically returns to the standard percentage.
Be aware that it may be difficult to maximize your rewards if the bonus category covers the kind of purchases you don’t normally spend a lot of money on.
For example, Discover’s bonus categories for October-December 2020 are Amazon.com, Target.com and Walmart.com. By maxing out all four of the Discover it Cash Back bonus 5% categories throughout the year (capped at $1,500 in spending each quarter, then 1%, activation required), you’ll earn $300 in cash back — not including spending you’d do in the 1 percent cash back category. Say you spend an additional $500 each quarter on non-category spending; that’s an extra $20 in cash back for the year.
Discover’s 2021 cash back categories have been announced, so take a look ahead to determine whether this card will be valuable to you in the coming year.
Consider combining cards
A combination of cards will probably serve you best. Some rewards credit cards offered by the same issuer let you use different cards to suit your needs and combine points.
Consider the Chase Freedom®, Chase Sapphire Reserve® and Ink Business Preferred Credit Card. Consumers who spend across a wide variety of categories can pick up this combination of cards and combine Chase Ultimate Rewards® points when they’re ready to redeem. By having all three cards, consumers can utilize bonus categories efficiently to maximize rewards for the year.
You can try the same kind of strategy with cards from different issuers. The key is to make sure your major spending categories are covered so that you’re always earning the maximum amount of rewards on purchases. In addition to credit cards that offer boosted rewards in a few categories, it’s a good idea to have a flat-rate card in your arsenal as a catchall.
Explore the card’s ‘online mall’
Some card issuers feature online shopping portals that offer cash back incentives, discounts or both. Examples include Chase Ultimate Rewards® and Barclaycard RewardsBoost.
Expert Advice: Maximizing your cash back strategy
If you’re willing to plan ahead, there are several ways to maximize your cash back earnings. We spoke with three finance experts about their favorite ways to stretch their purchases.
The strategy: Double dip with cash back apps
“One way that I maximize credit card cash back earnings is to use my credit card in combination with cash back apps. Apps like Ibotta work by giving you cash back when you purchase certain items at its partner retailers, with its list of eligible items including things that I regularly buy as, say, part of my weekly grocery list. This means that when I buy these things with my credit card, not only do I get cash back through my card, but I get extra cash through the app. Plus, the fact that I’d be buying these items anyway means I’m maximizing the cash I get from these purchases without having to spend any extra money, making it an even bigger bonus for my budget.”
— Anna Barker, founder of LogicalDollar
“Not only can you earn cash back by using your cash back credit card, but you can double up on that cash back by linking your card to Dosh. This free automatic cash back app rewards you with extra money back every time you pay with the linked card at one of their partner retailers including Walmart, Sephora or even Instacart. It’s a no brainer – all you do is link it one time and you will accumulate more cash back every time you pay with your credit card.”
— Andrea Woroch, budgeting expert seen on Good Morning America, The New York Times, The Wall Street Journal and more.
Additional reviews and research
Find out more about cash back credit cards with these resources from Bankrate:
Senior Editor Barry Bridges has been writing about credit cards, loans, mortgages and other personal finance products for Bankrate since 2018. His work has also appeared on websites including Nasdaq.com, Zillow.com and The Simple Dollar. He was previously an award-winning newspaper journalist in his native North Carolina. Send your questions about credit cards (and fantasy baseball) to email@example.com.
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