Apply now
On Capital One's secure site
Rewards rate
  • 8% Earn 8% cash back on Capital One Entertainment purchases and tickets at Vivid Seats
  • 5% Earn unlimited 5% cash back on hotels and rental cars booked through Capital One Travel, where you'll get Capital One's best prices on thousands of trip options. Terms apply
  • 3% Earn unlimited 3% cash back on dining, entertainment, popular streaming services and at grocery stores (excluding superstores like Walmart® and Target®).
  • 1% Earn 1% on all other purchases.
Intro offer
$200 
Annual fee
$0
Regular APR
17.99% - 27.99% (Variable)
Recommended credit
Good to Excellent (670 - 850)

Best for 2% cash rewards with intro APR

Wells Fargo Active Cash® Card

Apply now
On Wells Fargo's secure site
Rewards rate
  • 2% Earn unlimited 2% cash rewards on purchases
Intro offer
$200 cash rewards 
Annual fee
$0
Regular APR
17.99%, 22.99%, or 27.99% Variable APR
Recommended credit
Good to Excellent (670 - 850)

Best for up to 2% cash back

Citi® Double Cash Card

Apply now
On Citi's secure site
Rewards rate
  • 2% Earn 2% on every purchase with unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases.
Intro offer
$200 Cash Back 
Annual fee
$0
Regular APR
16.99% - 26.99% (Variable)
Recommended credit
Good to Excellent (670 - 850)
Apply now
On Capital One's secure site
Rewards rate
  • 5% Earn unlimited 5% cash back on hotels and rental cars booked through Capital One Travel, where you'll get Capital One's best prices on thousands of trip options. Terms apply
  • 1.5% Earn unlimited 1.5% cash back on every purchase, every day
Intro offer
$200 
Annual fee
$0
Regular APR
17.99% - 27.99% (Variable)
Recommended credit
Good to Excellent (670 - 850)
Bankrate-Icons-Final Choose your 3% category

Best for customizable 3% category

Bank of America® Customized Cash Rewards credit card

Apply now
On Bank of America's secure site
Rewards rate
  • 3% Earn 3% cash back in the category of your choice (up to $2,500 in combined choice category/grocery store/wholesale club quarterly purchases).
  • 2% Earn automatic 2% at grocery stores and wholesale clubs (up to $2,500 in combined choice category/grocery store/wholesale club quarterly purchases).
  • 1% Earn unlimited 1% on all other purchases.
Intro offer
$200 
Annual fee
$0
Regular APR
See Terms
Recommended credit
Good to Excellent (670 - 850)

Best for sign-up bonus

Chase Freedom Unlimited®

Apply now
On Chase's secure site
Rewards rate
  • 5% Enjoy 5% cash back on travel purchased through Chase Ultimate Rewards®, our premier rewards program that lets you redeem rewards for cash back, travel, gift cards and more;
  • 3% 3% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service
  • 1.5% 1.5% on all other purchases
Intro offer
Earn an Additional 1.5% Cash Back 
Annual fee
$0
Regular APR
17.24% - 25.99% Variable
Recommended credit
Good to Excellent (670 - 850)

Best for rotating cash back categories

Discover it® Cash Back

Apply now
On Discover's secure site
Rewards rate
  • 5% Earn 5% cash back on everyday purchases at different places each quarter like Amazon.com, grocery stores, restaurants, gas stations and when you pay using PayPal, up to the quarterly maximum when you activate.
  • 1% Plus, earn unlimited 1% cash back on all other purchases – automatically.
Intro offer
Cashback Match™ 
Annual fee
$0
Regular APR
14.24% - 25.24% Variable
Recommended credit
Good to Excellent (670 - 850)
Apply now
On American Express's secure site
See Rates & Fees , Terms Apply
See if you're pre‐approved for this card with CardMatch™
Rewards rate
  • 6% 6% Cash Back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%).
  • 6% 6% Cash Back on select U.S. streaming subscriptions.
  • 3% 3% Cash Back on transit including taxis/rideshare, parking, tolls, trains, buses and more.
  • 3% 3% Cash Back at U.S. gas stations
  • 1% 1% Cash Back on other purchases
Intro offer
$350 
Annual fee
$95
Regular APR
16.99%-27.99% Variable
Recommended credit
Good to Excellent (670 - 850)

Best for personal loan alternative

Upgrade Cash Rewards Elite Visa®

Apply now
On Upgrade's secure site
Rewards rate
  • 2.2% Earn 2.2% unlimited cash back on card purchases every time you make a payment
Intro offer
$200 
Annual fee
$0
Regular APR
14.99% - 29.99%
Recommended credit
Good to Excellent (670 - 850)

Best for automatic bonus category

Citi Custom Cash℠ Card

Apply now
On Citi's secure site
Rewards rate
  • 5% Earn 5% cash back on purchases in your top eligible spend category each billing cycle, up to the first $500 spent, 1% cash back thereafter.
  • 1% Earn unlimited 1% cash back on all other purchases.
Intro offer
$200 
Annual fee
$0
Regular APR
16.99% - 26.99% (Variable)
Recommended credit
Good to Excellent (670 - 850)

The information about the Amazon Prime Rewards Visa Signature Card, Costco Anywhere Visa® Card by Citi and Alliant Cashback Visa® Signature Credit Card has been collected independently by Bankrate.com. The card details have not been reviewed or approved by the card issuer.


Compare Bankrate’s top cash back credit cards

Card name Best for Cash back highlights Bankrate review score
Capital One SavorOne Cash Rewards Credit Card Restaurants Unlimited 3% on dining, entertainment, popular streaming services and at grocery stores (excluding Walmart® and Target®) 4.9 / 5
(Read full card review)
Wells Fargo Active Cash Card 2% cash rewards with an intro APR Unlimited 2% cash rewards on purchases 4.3 / 5
(Read full card review)
Citi Double Cash Card Up to 2% cash back Up to 2% cash back1% when you make purchases + 1% when you pay for them 4.3 / 5
(Read full card review)
Capital One Quicksilver Cash Rewards Credit Card 1.5% cash back 1.5% unlimited on all purchases 3.8 / 5
(Read full card review)
Bank of America Customized Cash Rewards credit card Customizable 3% category 3% in choice category (up to $2,500 in combined choice category/grocery store/wholesale club quarterly purchases) 4.6 / 5
(Read full card review)
Chase Freedom Unlimited Sign-up bonus 5% on Chase Ultimate Rewards travel purchases, 3% at restaurants and drugstores 5 / 5
(Read full card review)
Discover it Cash Back Rotating cash back categories 5% on rotating category purchases on up to $1,500 a quarter, then 1% (activation required) 4.4 / 5
(Read full card review)
Blue Cash Preferred Card from American Express Groceries 6% at U.S supermarkets (up to $6,000 per year, 1% after) 4.4 / 5
(Read full card review)
Upgrade Cash Rewards Elite Visa Personal loan alternative 2.2% unlimited cash back on card purchases every time you make a payment 4.2 / 5
(Read full card review)
Citi Custom Cash Card Automatic bonus category 5% cash back on purchases in your top eligible spend category each billing cycle, up to the first $500 spent, 1% cash back thereafter. Unlimited 1% cash back on all other purchases. 4.4 / 5
(Read full card review)
U.S. Bank Cash+ Visa Signature Card Customizable rewards 5 percent cash back on purchases in two categories of your choice (up to $2,000 in combined purchases per quarter, then 1 percent) 3.2 / 5
(Read full card review)
Amazon Prime Rewards Visa Signature Card Online shopping 5% at Amazon.com and Whole Foods Market (2% at restaurants, gas stations and drugstores; 1% back on all other purchases) 4.2 / 5
(Read full card review)
Alliant Cashback Visa® Signature Credit Card 2.5% cash back 2.5% cash back on all purchases (up to $10,000 in qualifying purchases each billing cycle, maximum cash back earning per billing cycle of $250) 3.9 / 5
(Read full card review)
Capital One QuicksilverOne Cash Rewards Credit Card Fair credit Unlimited 1.5% on all purchases 4.1 / 5
(Read full card review)
Discover it® Secured Credit Card Bad credit 2% cash back on gas stations and restaurants (up to $1,000 in combined spending per quarter and 1% on everything else) 5 / 5
(Read full card review)

A closer look at our top cash back cards

Capital One SavorOne Cash Rewards Credit Card: Best for restaurants

  • What we love about the SavorOne Cash Rewards Card: Its entertainment category includes a variety of eligible purchases, such as tickets to concerts, movies, sporting events, theme parks and tourist attractions — purchases that would earn just 1 percent back with most other cash back cards.
  • Who this card is good for: Restaurant-goers, grocery shoppers and even social butterflies can find something to love about this card.
  • Alternatives: While the SavorOne Cash Rewards Card earns generously at grocery stores, there are cards that earn more on these purchases. Plus, the card’s 3 percent back on dining is outpaced by the Citi Custom Cash card’s 5 percent back in your top eligible spend category, including restaurants (on up to $500 in spending each billing cycle, then 1 percent).

Learn more: Why expert Ana Cvetkovic loves the Capital One SavorOne Cash Rewards Card
Read our Capital One SavorOne Cash Rewards Credit Card review or jump back to offer details.

Wells Fargo Active Cash Card: Best for 2% cash rewards with an intro APR

  • What we love about the Wells Fargo Active Cash Card: Aside from the stellar rewards rate, there’s another standout feature — cellphone protection. You’ll receive up to $600 of protection (subject to a $25 deductible) against covered damage or theft when you pay your monthly cellphone bill with your card.
  • Who this card is good for: Simplicity seekers and those planning to make a large purchase. Thanks to the card’s intro APR offer, you can earn consistent cash rewards and minimize interest charges on new purchases.
  • Alternatives: If you’d like to earn a higher rate of rewards in a variety of spending categories, the Discover it Cash Back Card earns up to 5 percent cash back in different bonus categories that rotate each quarter (upon enrollment, on to $1,500 in purchases, then 1 percent).

Learn more: Is the new Wells Fargo Active Cash worth it?
Read our Wells Fargo Active Cash Card review or jump back to offer details.

Citi Double Cash Card: Best for up to 2% cash back

  • What we love about the Citi Double Cash Card: The rewards structure incentivizes you to stay on top of your payments. You’ll only earn the full 2 percent cash back on your purchases once you’ve paid them off — 1 percent back when you buy, 1 percent when you pay off purchases.
  • Who this card is good for: Hands-off rewards earners. Cardholders get a straightforward cash back card for no annual fee without having to track tiered categories or worry about quarterly enrollment.
  • Alternatives: If you have large purchases coming up and want a promotional period to save money on interest charges, consider the Wells Fargo Active Cash Card. It earns the same flat rate on purchases but comes with a long intro APR offer for purchases and balance transfers.

Learn more: Why expert Holly Johnson loves the Citi Double Cash Card.
Read our Citi Double Cash Card review or jump back to offer details.

Capital One Quicksilver Cash Rewards Credit Card: Best for 1.5% cash back

  • What we love about the Quicksilver Cash Rewards Card: For a no-annual-fee card, the Quicksilver offers quite a few protections, including travel accident insurance, 24-hour travel assistance services and extended warranty protection.
  • Who this card is good for: Cash back beginners. With a flat rate and no annual fee, this card is a solid low-maintenance option for someone just getting started earning cash back rewards.
  • Alternatives: If you spend heavily on purchases like groceries and gas, you’re likely to earn more cash back with a card that has a higher rewards rate in those categories. The Bank of America Customized Cash Rewards Card is a worthy alternative, as it retains a generous cash back rate in multiple categories and gives cardholders the option to change their highest cash back category once per calendar month.

Learn more: Why expert Nicole Dieker loves the Capital One Quicksilver Cash Rewards.
Read our Capital One Quicksilver Cash Rewards Credit Card review or jump back to offer details.

Bank of America Customized Cash Rewards credit card: Best for customizable 3% category

  • What we love about the Customized Cash Rewards Card: The ability to pick from six bonus categories is pretty great. Even better is the fact that you can change your pick once per calendar month to match your spending habits.
  • Who this card is good for: People looking for flexibility. If you want the freedom to choose and change your bonus rewards category, this card is a great option.
  • Alternatives: This card’s cash back limits may hold you back. Heavy spenders may earn more with a card that offers an unlimited flat rate on all purchases, such as the Citi Double Cash Card — no matter how much you charge to the card, you can earn up to 2 percent back (1 percent when you buy and another 1 percent when you pay off purchases).

Learn more: Is the Bank of America Customized Cash Rewards credit card worth it?
Read our Bank of America Customized Cash Rewards credit card review or jump back to offer details.

Chase Freedom Unlimited: Best for sign-up bonus

  • What we love about the Chase Freedom Unlimited: This card offers bonus rewards for far more travel-related purchases than the typical cash back card. Its 1.5 percent cash back on all purchases that fall outside bonus categories is also higher than the typical 1 percent offered by other bonus category cash back cards. It comes with one of the most valuable sign-up bonuses around, though the spending requirement to earn maximum value is far higher than you’ll find with other sign-up bonuses.
  • Who this card is good for: People who want to stick with a single everyday rewards card and frequent travelers who want to avoid annual fees and earn rewards at a high rate on more than just airline, hotel, and rental car bookings.
  • Alternatives: A few cards also have a high rewards rate in travel and other everyday categories, but their welcome offers may be easier to maximize. The Capital One SavorOne Cash Rewards card earns bonus rewards in a variety of travel and everyday categories. It also comes with a welcome offer of $200 after just $500 in spending in your first three months.

Learn more: Why expert Jacqueline DeMarco loves the Chase Freedom Unlimited card.
Read our Chase Freedom Unlimited review or jump back to offer details.

Discover it Cash Back: Best for rotating cash back categories

  • What we love about the Discover it Cash Back Card: This card offers 5 percent cash back on up to $1,500 spent in categories that rotate each quarter, then 1 percent (activation required). This can be especially rewarding for cardholders who can flex their spending to align with the Discover boosted cash back categories each quarter.
  • Who this card is good for: People who can adjust their spending to maximize cash back earnings across various categories and aren’t troubled by keeping up with Discover’s 2022 cash back calendar.
  • Alternatives: If you value simplicity or your spending stays consistent throughout the year, you may prefer a card that doesn’t require you to enroll in new bonus categories each quarter. Opting for a flat-rate cash rewards card like the Citi Double Cash or Wells Fargo Active Cash can make it easier to earn more cash back consistently.

Learn more: Is the Discover it Cash Back worth it?
Read our Discover it Cash Back review or jump back to offer details.

Blue Cash Preferred Card from American Express: Best for groceries

  • What we love about the Blue Cash Preferred Card: Few cash back cards offer rates as high as 6 percent, much less in a rewards category as valuable as U.S. supermarkets (6 percent on up to $6,000 in purchases at U.S. supermarkets per year, then 1 percent).
  • Who this card is good for: People with a moderate-to-large grocery budget who can offset the card’s annual fee and still rake in a considerable amount of cash back.
  • Alternatives: If you do most of your grocery shopping at wholesale clubs like Sam’s Club and Costco, you may struggle to find value with the Blue Cash Preferred because those stores aren’t considered U.S. supermarkets by American Express. A strong alternative is the Bank of America Customized Cash Rewards Card, which earns bonus cash back in a category of your choice, with wholesale clubs as just one option.

Learn more: Why expert Ted Rossman loves the Blue Cash Preferred Card from American Express.
Read our Blue Cash Preferred Card from American Express review or jump back to offer details.

Upgrade Cash Rewards Elite Visa: Best for personal loan alternative

  • What we love about the Upgrade Cash Rewards Elite Visa: Every time you make a payment, this card rewards you with one of the highest flat cash back rates on the market. It also charges fewer fees than the typical credit card and comes with a sign-up bonus (not always found on flat-rate cash back cards).
  • Who this card is good for: Fans of flat-rate cards who can pay their balances in full and people looking for a low-interest card who can qualify for the low end of the card’s ongoing APR range.
  • Alternatives: One of the most unique traits of the Upgrade Cash Rewards Elite Visa is its emphasis on making card payments to earn your cash back rewards. If you want the best of both worlds and to earn when you spend and when you pay, the Citi® Double Cash Card allows you to do just that, since you’ll earn 1 percent cash back when you spend and another 1 percent when you pay. Just keep in mind that you’ll earn marginally less with the Double cash.

Learn more: Is the Upgrade Cash Rewards Elite Visa worth it?
Read our Upgrade Cash Rewards Elite Visa card review or jump back to offer details.

Citi Custom Cash Card: Best for automatic bonus category

  • What we love about the Citi Custom Cash Card: There are 10 eligible bonus categories to choose from and many of them conveniently fit into a cash back or rewards strategy.
  • Who this card is good for: Someone looking for a high rate of cash back who doesn’t want to remember to activate bonus categories.
  • Alternatives: You’ll only earn 5 percent back on the first $500 you spend in a single category each billing cycle (after that, 1 percent), so you may stunt your monthly cash back if you only use the Citi Custom Cash. Consider supplementing this card with a tiered cash back card that earns at a consistent rate in your biggest spending categories. For example, the Capital One SavorOne earns 3% back on dining, eligible streaming services, grocery stores and entertainment, with no limit to how much cash back you can earn.

Learn more: Why your Citi Custom Cash card could be great for travel
Read our full Citi Custom Cash Card review or jump back to offer details.

U.S. Bank Cash+ Visa Signature Card: Best for customizable rewards

  • What we love about the US Bank Cash+ card: It’s a rare treat to find a card that lets you choose which categories will earn bonus cash back. Along with its fixed travel rewards category, the Cash+ card lets users pick two categories that will earn 5 percent cash back each quarter (up to $2,000 in combined purchases per quarter, then 1 percent) and one everyday category that will earn 2 percent cash back.
  • Who this card is good for: People eager to maximize cash back earnings with a multi-card strategy. This card’s flexibility and high earning potential make it a particularly great option for people who don’t mind juggling multiple credit cards to get as much value out of them as possible.
  • Alternatives: If you don’t like strategizing and tracking rewards categories, a flat-rate card like the Wells Fargo Active Cash Card may be a better fit. You’ll earn 2 percent cash rewards on your purchases, without needing to track spending or enroll in bonus categories.

Learn more: U.S. Bank Cash+ Visa Signature Card vs. Chase Freedom Flex
Read our full U.S. Bank Cash+ Visa Signature Card review.

Capital One QuicksilverOne Cash Rewards Credit Card: Best for fair credit

  • What we love about the QuicksilverOne Cash Rewards Card: You’ll automatically be considered for a higher credit line in as little as six months with on-time payments, which can help you keep your credit utilization in check.
  • Who this card is good for: Credit-builders who want to earn cash back.
  • Alternatives: Although 1.5 percent cash back is a decent rate, it may not be worth the card’s annual fee based on your spending habits. If you want to avoid both an annual fee and a security deposit, consider a no-annual-fee, unsecured credit-building card like the Petal® 1 “No Annual Fee” Visa® Credit Card or the Petal® 2 “Cash Back, No Fees” Visa® Credit Card.

Learn more: Capital One QuicksilverOne vs. Capital One Platinum
Read our Capital One QuicksilverOne Cash Rewards Credit Card review.

Amazon Prime Rewards Visa Signature Card: Best for online shopping

  • What we love about the Amazon Prime Rewards Visa: Retail cards aren’t known for their sign-up bonuses or perks, but new Amazon Prime Rewards cardholders receive a $150 Amazon gift card upon approval, with no minimum spending requirement. Your purchases are also covered by an extended warranty and purchase protection.
  • Who this card is good for: Whole Foods shoppers and Amazon Prime members. Earning 5 percent back for both online purchases and groceries is a rare offer, making the card ideal for Amazon customers who are looking for new ways to save.
  • Alternatives: Cardholders who don’t spend frequently on Amazon or shop at Whole Foods — or who want more flexibility to earn rewards at other grocery stores and online retailers — may find more value in a flat-rate cash rewards card like the Wells Fargo Active Cash card or the Citi Double Cash.

Learn more: Amazon Prime Rewards Visa Signature offers ample points for online shopping
Read our Amazon Prime Rewards Visa Signature Card review.

Alliant Cashback Visa Signature Credit Card: Best for 2.5% cash back

  • What we love about the Alliant Cashback Visa: This card offers a cash back rate that’s almost unheard of: 2.5 percent back on all purchases (on up to $10,000 in qualifying purchases per billing cycle, then 1.5 percent).
  • Who this card is good for: Big spenders with Alliant Credit Union accounts. To maintain your 2.5 percent cash back rate, you need to keep an average daily balance of $1,000 in your Alliant High-Rate Checking account every month of the preceding calendar quarter.
  • Alternatives: A flat 2.5 percent cash back on all purchases (up to $10,000 per billing cycle, then 1.5 percent) is a great offer, but cardholders must be a member of the Alliant Credit Union. If you don’t want the headache of switching banks and maintaining an account balance, a no-annual-fee flat-rate card like the Wells Fargo Active Cash can be a great alternative despite earning at a lower rate of 2 percent cash rewards back.

Read our Alliant Cashback Visa Signature Credit Card review.

Discover it Secured Credit Card: Best for bad credit

  • What we love about the Discover it Secured Card: Welcome bonuses are rare among credit cards for bad credit, but the Discover it Secured stands out for automatically matching all the cash back you’ve earned at the end of your first year.
  • Who this card is good for: People with bad or no credit who want to earn rewards while they work on their score.
  • Alternatives: If you have poor credit, options for cash back are limited, especially if you’re not willing to put up an annual fee or security deposit. If you’d rather avoid a security deposit, however, consider an unsecured credit-building card like the Petal 1 card.

Learn more: Discover it Secured vs. Petal 1
Read our Discover it Secured Credit Card review.


What is a cash back credit card?

Cash back credit cards reward you for eligible purchases by giving you a percentage of your purchase price back as cash. 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 percent 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 the discount at checkout, but the payoff comes when you redeem your rewards.

Types of cash back credit card rewards

Cash back cards come in a variety of forms. The best cash back credit card type for you depends on your spending habits and lifestyle. Before you apply, you should know all of the options available to you.

Lightbulb
Bankrate insight
A 2 percent cash back card is a must-have, according to industry analyst and credit card expert Ted Rossman. It often comes with no annual fee and can be used as a standalone card or part of a multi-card strategy. Learn more on why you should have a 2 percent cash back card.

Pros and cons of using cash back credit cards

While cash back cards can put hundreds of dollars per year back into your wallet, they can also come with drawbacks that make them less appealing. Here are some advantages and disadvantages of carrying a cash back card.

Pros

  • Earn rewards: If you pick a card that fits your spending habits, you can earn some extra cash every month just by using your credit card.
  • Build credit: Used responsibly, a cash back credit card can help you improve your credit score by adding to your credit history.
  • Many have no annual fee: Plenty of the best cash back credit cards feature no annual fee. As long as you pay your bill in full, you won’t have to worry about whether you’re coming out ahead, no matter how you spend with the card
  • Sign-up bonuses: A sign-up bonus or welcome offer is an incentive offered to new cardholders who spend a certain amount within the first few months of opening the account. Cash back credit cards often offer bonuses worth a few hundred dollars.

Cons

  • Sometimes less valuable than travel rewards: With cash back cards, you usually can’t score a particularly lucrative deal with your redemption, as you might when trading in travel rewards points for a flight.
  • Higher APRs: Rewards cards typically come with higher interest rates, so it almost always makes sense to choose a low-interest credit card instead of a cash back card if you carry a balance from month to month.
  • Value-limiting restrictions: As with any credit card, make sure to read the fine print. Some cards require you to periodically activate or enroll in your cash back category to earn cash back.

 

Who should get a cash back credit card?

Just about anyone can benefit from getting a small portion of their purchases back. And unlike travel points or miles, you’re free to use cash back however you please. In fact, our experts share that credit card rewards are a way Americans can combat today’s rising prices and interest rates.

For suggestions based on your spending habits, try Bankrate’s Spender Type Tool. Select the spender type that you most closely identify with and you’ll get card recommendations that may suit your spending habits.

When you shouldn’t get a cash back card

Credit cards can play an important role when it comes to your personal finances while also teaching important life lessons. But they’re not for everyone. Here’s when a cash back card isn’t the best idea:

  • You’re a frequent flyer: If you travel often, a type of rewards credit card structured specifically to earn points and miles on travel purchases is a better addition to your wallet.
  • You tend to carry a balance: Credit card interest can eat away at your rewards and leave you owing more than you earn. If you don’t pay your balance in full each month, a low interest option like a credit union credit card may be a better fit.
  • You don’t follow a budget: Overspending is one of the main causes of credit card debt. If you make impulse purchases and spend more than you can afford, hold off on applying for a credit card until you’re ready to follow a budget.

How to choose the best cash back credit card

When it comes to picking a cash back credit card, the details make all the difference. A cash back card’s restrictions and conditions will impact its ability to help you earn cash back rewards if you don’t take the time to understand them. When comparing cards, ask yourself the following questions to determine if the cash back card you’re eyeing is right for you:

What’s my credit score?

This should be your starting point when comparing cash back cards. Most of the best cash back credit cards require at least good credit. And while some credit cards for fair credit or bad credit offer rewards, cardholders at this credit level should focus on building credit, not earning rewards.

Do I want to earn maximum rewards?

You’ll need to choose between flat-rate and bonus category credit cards. Flat-rate credit cards may not earn the best rewards rate available in a given category, but they’re a great option for someone who just wants to earn consistent cash back on all purchases with minimal effort. On the other hand, bonus category cash back cards can offer higher rewards rates, but it will take more work to maximize your credit card rewards. You may need to juggle more than one credit card, enroll in rotating bonus categories or track multiple categories and deal with spending caps.

How can I redeem rewards?

Each cash back program will vary in how you can redeem rewards, so pay attention to the terms and conditions to make sure you’re okay with any restrictions. Depending on the program, you may have to wait until you’ve hit a minimum redemption amount before you can redeem your rewards. In some programs, you may only be able to redeem your rewards for a statement credit. And while some programs have multiple redemption options, you’ll need to check to make sure you’re getting your money’s worth. The value of your rewards could drop below one cent when redeeming for certain options, like gift cards.

What’s the cost?

Make sure you look at more than just the benefits of a credit card. You’ll also want to pay attention to the costs of ownership. You’ll need to decide if a card’s rewards and perks make paying an annual fee worth it while also watching out for interest rates and any other common credit card fees like late charges and balance transfer fees. For example, a card that earns 6 percent back at supermarkets but charges an annual fee of $95 might cost you more in the long run than a card that earns 3 percent back but charges no annual fee.

What else can a cash back card do for me?

The best cash back credit cards have additional features and benefits that increase their value. Depending on what matters most to you, be on the lookout for perks like a sign-up bonus, intro APR offer or shopping discounts, as well as money-saving travel and consumer protections.

Lightbulb
Bankrate insight
Shopping protections like extended warranty and purchase protection are common cash back credit card perks that could save you a lot of money. For example, the Chase Freedom Flex covers damage or theft of items purchased with the card for up to 120 days with a maximum of $500 per claim and $50,000 per account.

Cash back alternatives

Cash back cards have a lot of advantages, but they may not be the best fit for everyone. Here are a few alternatives to consider:

  • Travel credit card: Best for frequent travelers who want to redeem their rewards for flights and hotel stays and who can take advantage of a travel card’s additional benefits to further cut down on the costs of travel and make their next trip more fun and rewarding.
  • Low-interest or credit union cards: Best for people who tend to carry a credit card balance and could benefit from having an ongoing low interest rate.
  • Balance transfer credit card: Best for people looking to take advantage of a promotional APR period to make interest-free payments and pay down credit card debt more efficiently.
  • Student credit card: Best for college students new to the credit world who are looking to improve their credit score and show off good credit habits.
  • Credit-builder credit cards: Best for people with credit that falls below the good-to-excellent range who want to improve their credit score to gain access to better rates, credit limits and card benefits.

6 ways to maximize cash back

  1. Pay your balances in full each month. Otherwise, you’ll simply lose the cash back you’ve earned (and then some) to interest. Note: Paying monthly balances on time and in full is a best practice, no matter what type of card you’re carrying.
  2. Snag a sign-up bonus. Choose a cash back credit card that offers bonus rewards if you spend a certain amount of money within a specified time period. Just make sure the spending requirement is in-line with your current spending habits, or you’ll risk carrying a balance and losing rewards to interest.
  3. Enroll or activate your bonus categories each quarter. Rotating category cards typically require you to enroll or activate (the language varies) the bonus cash back categories for the upcoming quarter to earn the higher bonus rate. If you don’t, you’ll earn the standard rate.
  4. Consider combining cards. A combination of cards will probably serve you best. 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.
  5. Explore the card’s online shopping portal. Some card issuers feature online shopping portals that offer cash back incentives, discounts or both. Examples include Chase Ultimate Rewards and Barclaycard RewardsBoost.
  6. Don’t spend for the sake of earning. It’s not worth it to spend in excess of what you normally spend just because you’ll earn a small percentage of cash back.
Lightbulb
Bankrate insight
Consider the Chase Freedom Flex, 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.

Video: Why 2% cash back cards are a great addition to any wallet



Additional reviews and research

If you’re on the fence about cash back cards, consider how your annual spending compares to consumer averages. According to the Bureau of Labor Statistics, Americans spent an average of $4,942 on food at home in 2020. If you used a cash back card that carried a 3 percent cash back rate at grocery stores to cover these expenses, you’d earn $148.26 in cash back.

Earning nearly $150 in cash back just for purchases at supermarkets is a pretty generous offer. However, if you aren’t convinced, compare that to the cash back potential of a 2 percent flat rate card. On average, consumers spent a combined total of $19,489 on food at home, food away from home, transportation and household furnishings in 2020. With a 2 percent cash back card, this would amount to $389.78 of cash back earnings.

While cash back cards might not be worth the trouble for everyone, responsible card use and smart spending habits can make them a great addition to your wallet. Find out more about cash back credit cards with these resources from Bankrate:

How we chose our best cash back cards

All credit cards from our partners are rated with a 5-star scoring system. To select the best cash back cards, we narrow our focus to concentrate on key features that make a big difference in this specific category, such as:

Cash back rates

While a rate of 1 percent cash back on all eligible purchases is useful, the cards that truly stand out tend to earn higher percentages. To estimate how much an average consumer might earn with particular cards, we used spending data from the Bureau of Labor Statistics.

Special categories

Many of our top-rated cards feature higher rates for certain purchase categories, which makes it easier to find the most lucrative card for your spending habits and lifestyle.

Low fees and cost of ownership

The whole point of cash back cards is to earn rather than owe, so cards that go easy on annual fees and similar charges get high marks.

Variable APR

We recommend against carrying a credit card balance if at all possible — but if you have to, a reasonable and affordable interest rate can make it less financially taxing.

Have more questions for our credit cards editors? Feel free to send us an email, find us on Facebook, or Tweet us @Bankrate.

Frequently asked questions about cash back credit cards

about the author
Mariah Ackary is a personal finance editor who joined the Bankrate team in 2019, excited by the opportunity to help people make good financial decisions. Send your questions to mackary@bankrate.com
about the editor
Former Senior Editor Barry Bridges has been writing about credit cards, personal loans, mortgages and other personal finance products since 2017. Before joining Bankrate, he was an award-winning newspaper journalist in his native North Carolina.

* See the online application for details about terms and conditions for these offers. Every reasonable effort has been made to maintain accurate information. However all credit card information is presented without warranty. After you click on the offer you desire you will be directed to the credit card issuer's web site where you can review the terms and conditions for your selected offer.