How to maximize flat-rate cash back credit cards

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Dear Cashing In,

I just got approved for a cash back card that gives 2 percent cash back. This is my first cash back credit card. Do you have tips on how I can maximize my rewards? – Amy

Dear Amy,

Congrats on getting your first cash back credit card! Now is a great time to start earning cents back on every dollar you spend, and you’re smart to be thinking about what kind of credit card strategy will help you maximize your cash back earning.

Have a rewards question for Stephanie? Drop her a line at the Ask Bankrate Experts page!

How to build a cash back strategy

My top three tips on getting started to build a cash back strategy are: choosing the best cash back credit card for your spending habits, using cash back as part of your bigger credit card points strategy and double-dipping on cash back portals for extra earnings.

Here’s what you need to know to make these strategies work for your wallet:

Maximize your cash back bonuses with a ‘best credit card’ strategy

The best credit card strategy for maxing out your cash back earnings is to always use your card in a way that aligns with your personal spending habits.

Starting out with a one-size-fits-all card like the Citi® Double Cash Card that earns 2 percent back on every dollar you spend (1 percent when you buy and 1 percent when you pay for your purchase) with no annual fee is great. Make sure you use your card on everything that you can!

As you look toward maximizing your earnings, however, you’ll want to start paying more attention to where you regularly spend the most money. If a large portion of your weekly expenses falls into certain categories (like gas or groceries), it’s likely time to diversify your credit card portfolio to include a cash back card that earns a bigger bonus in these specific spending categories.

For these categories of gas and groceries, as an example, you’d likely want to add a card like the Blue Cash Preferred® Card from American Express that earns 6 percent cash back at U.S. supermarkets on up to $6,000 per year in purchases (then it’s 1 percent) and 3 percent cash back at U.S. gas stations. The Blue Cash Preferred has a $95 annual fee ($0 introductory annual fee for the first year)

With multiple cash back cards, you’ll be able to maximize earnings by matching each purchase you make to the highest-earning cash back card you hold. Use your Blue Cash Preferred card only where you’re getting more than 2 percent back and your flat rate 2 percent Citi Double Cash Card everywhere else.

See related: Why I love the Blue Cash Preferred

Cash back as part of your bigger credit card points strategy

Your cash back strategy should also be part of your larger credit card points strategy—particularly if you’re also interested in maximizing travel or shopping rewards.

Many credit card rewards-earners think you have to choose between being a cash back earner or a travel rewards earner. This isn’t true. By choosing one of the best cash back cards that pairs with flexible rewards programs—like the Citi Double Cash Card or the Chase Freedom Unlimited®—you give yourself more options for redemptions.

Many credit card rewards-earners think that you have to choose between being a cash back earner or a travel rewards earner. This isn’t true.

For example, the Citi Double Cash Card not only earns you 2 percent back (1 percent when you buy and 1 percent when you pay for your purchase), but the program also allows you to convert cash reward earnings to Citi ThankYou points, which can be redeemed for travel, gift cards and purchases through select retail partners.

If you hold both the Citi Double Cash Card and one of Citi’s more traditional travel rewards cards, like the Citi® Premier Card, you’ll have even more options for spending your cash back rewards through the ThankYou program.

Likewise, the Chase Freedom Unlimited card is a great no annual fee cash back card that earns at least 1.5 percent cash back rewards, which can be converted to Chase Ultimate Rewards points if you also hold a traditional Ultimate Rewards-earning card like the Chase Sapphire Reserve® or Chase Sapphire Preferred® Card.

Tip: Pairing cash back credit cards with travel rewards cards is a great strategy for hard-core travelers who prefer travel rewards over cash back in normal times but aren’t sure when they’ll travel next. Earn cash now with the option of converting your cash credits to reward points when travel reenters the picture.

Double-dip for extra cash back

If your credit card strategy is to earn as many cash back points as possible for every purchase, you’ll want to make sure that you’re taking advantage of every opportunity to “double-dip” for earnings.

Smart credit card shoppers can earn twice on transactions by using a cash back credit card to make purchases through a rewards shopping portal like an airline’s e-shopping mall or a cash back portal like Rakuten or the iBotta app.

For example, if you use your Citi Double Cash Card to buy a $299 Samsung tablet through, you’d earn a $6 statement credit. Alternatively, you could earn twice on this purchase by logging into using the Rakuten cash back shopping portal (currently offering 12 percent cash back on purchases).

You’d still earn a $6 statement credit on your Citi Double Cash Card, plus you’d earn another $36 in cash back via Rakuten, paid out by check or via PayPal. And if you’ve never used Rakuten before, you’ll also get a $10 bonus for signing up. That adds up to $42 cash back on your $299 purchase. Now we’re talking!

Bottom line

When it comes down to it, you can never lose if you’ve got a good cash back credit card strategy. Play your cards right and you’ll just keep earning more.

Written by
Stephanie Zito
Travel Rewards Expert Contributor
Stephanie Zito is a professional traveler, self-employed humanitarian consultant and collector of credit card points. She shares savvy travel tips that she’s learned firsthand circling the globe for more than 25 years. She’s a backpacker, expect and premium traveler who’s visited more than 130 countries and all seven continents. Her life motto is “See the world, change the world, have fun doing it!”, and her mission is to inspire others along the journey.
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