Ally Everyday Cash Back Mastercard review: Elevated cash back on everyday spending

The Ally Everyday Cash Back Mastercard is one of the newest rewards cards from Ally Bank, offering 3 percent cash back on common expenses such as gas stations, grocery stores and drugstores with 1 percent cash back on all other purchases.

The Everyday Cash Back Mastercard, which was introduced in 2016 and discontinued in 2019, has recently reentered the cash back credit card market. It has boosted its rewards rate in its main bonus categories, but its range of perks remains limited, especially in comparison to other cash back cards with similar spending categories. The card could be a useful addition to your collection, but in terms of features, rewards rates and earning potential, there are undoubtedly other cash back cards that are proven to be more valuable.

Quick highlights

• Rewards rate: Earn 3 percent cash back at gas stations, grocery stores and drugstores and 1 percent cash back on everything else
• Welcome offer: None
• Annual fee: $0 to $39
• Purchase intro APR: N/A
• Balance transfer intro APR: N/A
• Regular APR: 17.99 percent to 28.99 percent (variable)

Current welcome offer

The Ally Everyday Cash Back Mastercard currently does not offer a welcome bonus for new cardholders, which is a major drawback when compared to similar cash back credit cards such as the Chase Freedom Flex℠ Card, which offers a $200 cash bonus after spending $500 in the first three months and similar rewards rates.

The previous version of Ally Everyday Cash Back card offered a $100 sign-up bonus after spending $500 in purchases within the first 90 days, which wasn’t unreasonable considering the low spending threshold, so potential applicants may be better off waiting to see if a significantly increased offer returns to this card.

Rewards rate

Cardholders can earn 3 percent cash back in the following categories:

• Gas
• Groceries
• Drugstores

Every other purchase earns 1 percent cash back. Because the rewards you earn do not expire, you are not required to redeem your earnings by a certain timeframe.

How you earn

With the Ally Everyday Cash Back Card, you earn 3 cents per dollar on purchases at gas stations, grocery stores and drugstores. All other purchases outside of these categories earn 1 cent per dollar. All the cash back you earn is tracked and accumulates in your credit card account and is available whenever you want to redeem them.

There is no limit to how much you can earn, so using the card for everyday purchases should be simple and a quick way to stack reward earnings. Since transportation and food are the top two and three expenditures for consumers, respectively, according to the Bureau of Labor Statistics, it’s a sensible option for people with fair credit who want rewards.

How to redeem

Cardholders can redeem their earnings at any time, and no minimum amount is required to redeem. But unfortunately, the only way to redeem the cash back you earned is through a statement credit, which is a slight disadvantage when compared to competing cards such as the Discover it® Cash Back Card, which allows you to redeem cash back earnings via direct deposit, statement credit, gift cards, charitable donations and payments toward Amazon.com.

Rewards are worth 1 cent each, as the card earns 3 cents per dollar spent on gas, grocery and drugstore purchases and are worth 1 cent for other purchases. If you were to spend $350 on groceries every month, your cash back earnings on those purchases would amount to $10.50. The rewards have a fixed value and do not fluctuate because the only redemption option is a statement credit, so you don’t have to worry about losing out on any reward earnings once you redeem them.

Other than the standard zero fraud liability and fraud monitoring features, this cash back card does not offer any special perks to cardholders that make it stand out from others. That said, you can take advantage of free access to your FICO credit score, the ability to disable your card in the event of loss or theft as well as 24/7 customer support.

Free FICO credit score access

The Ally Credit Card mobile banking app allows you to check your FICO score history, receive regular updates on your credit score and keep track of the key factors affecting your score.

Card lock feature

If you happen to lose your card or think it has been stolen, you can turn the card off via the Ally Credit Card mobile banking app, as it will prevent anyone from using the card to make unauthorized purchases.

24/7 customer service

You can get help anytime you need it by contacting Ally’s customer service team with any questions or concerns you might be having with your card.

The fact that this card has no over-the-limit fees if you exceed your credit limit, no foreign transaction fees, no spike in interest rates if you make a late payment and no returned payment fees is one of its biggest benefits. Although there is a chance that your annual fee could range from $0 to $39 depending on your creditworthiness.

The credit card’s ongoing APR can vary between 17.99 percent to 28.99 percent (variable). The card doesn’t come with a 0 percent intro APR offer, which is a let-down for a cash back card, as it usually gives cardholders the opportunity to save interest on purchases for a limited time.

Other cash back cards may give you more opportunities to save interest than the Ally Everyday Cash Back Mastercard. For example, the Wells Fargo Active Cash® Card has a 0 percent intro APR period for 15 months from account opening (19.99%, 24.99%, or 29.99% variable APR thereafter) on purchases and qualifying balance transfers made within 120 days (intro 3 percent balance transfer fee, then up to 5 percent or minimum $5) with 2 percent cash rewards on purchases.

Even though the Ally Everyday Cash Back Mastercard offers a decent reward rate on gas, grocery and drugstore purchases, there are several other card options available that offer a better return on cash back in these same categories or a higher return on all other purchases.

Ally Everyday Cash Back Mastercard vs. Ally Unlimited Cash Back Mastercard

The Ally Unlimited Cash Back Mastercard is fairly similar to the Everyday Cash Back Mastercard is terms of cardholder features (and the lack of a sign-up bonus, 0 percent intro APR period and stand-out card perks as well), but its flat-rate rewards rate of 2 percent cash back on all purchases and no annual fee is what makes it different from its sister card, which has a tiered-based rewards rate and a potential annual fee up to $39.

If you tend to spend more on gas, groceries or drugstore purchases, then it would make sense to go for the Everyday Cash Back Card to earn more rewards, but if you don’t want to limit yourself to specific categories and want to have the chance to earn more than 1 percent on all purchases, then the Unlimited Cash Back Card could suit you better.

Ally Everyday Cash Back Mastercard vs. Blue Cash Preferred® Card from American Express

Unlike the Ally Everyday Cash Back Card, the Blue Cash Preferred Card from American Express comes with 0 percent APR offer for 12 months on purchases and qualifying balance transfers, as well as a $250 welcome bonus after spending $3,000 in purchases within the first six months of account opening. However, it’s APR rate (18.99 percent to 29.99 percent variable) is similar to the Ally Everyday Cash Back (17.99 percent to 28.99 percent variable), so you won’t be saving much in interest after the introductory APR period ends with the Blue Cash Preferred.

The Blue Cash Preferred Card also offers 6 percent cash back on supermarket purchases (up to $6,000 per year in purchases, then 1 percent) and select U.S. streaming subscriptions, 3 percent on U.S. gas stations and transit and 1 percent on all other purchases. You have the chance to earn more cash back on grocery store purchases with the Blue Cash Preferred than the Ally Everyday Cash Back Card, as well as earn high rewards toward subscription services and transit as well, but the downside is that the Blue Cash Preferred comes with an $95 annual fee after the first year, which could be too pricey for some cardholders, and it doesn’t include drugstores, which could be an important category for people considering the Everyday Cash Back Card.

Best cards to pair with this card

Because you can only earn elevated rewards in three specific spending categories, it may be best to pair the Ally Everyday Cash Back Mastercard with a flat-rate cash back rewards card, such as the Citi® Double Cash Card, which earns up to 2 percent back on every purchase (unlimited 1 percent cash back when you buy and an additional 1 percent as you pay for those purchases) — that way you can earn more than 1 percent cash back on purchases that don’t qualify for the 3 percent cash back categories with the Ally Everyday Cash Back Mastercard.

However, since the Citi Double Cash Card is only accessible to people with good to excellent credit, people with fair credit could consider pairing the Ally Everyday Cash Back Mastercard with the Capital One QuicksilverOne Cash Rewards Card, which offers unlimited 5 percent cash back on hotels and rental cars booked through Capital One Travel and unlimited 1.5 percent cash back on all other purchases.

While the Ally Everyday Cash Back Mastercard rewards you for everyday purchases at gas stations, grocery stores and drugstores, there isn’t much else that this card offers in terms of cardholder perks, sign-up bonus, reward redemption options or even a 0 percent introductory APR offer like you can find with other cash back rewards cards. If you have fair to good credit, this could be a great card to graduate to while building credit and a decent pick to keep as an option for your everyday spending. But if you want more long-term value and the chance to maximize cash back in these spending categories, you’ll want to upgrade to another card once your credit improves.

The information about the Chase Freedom Flex℠ has been collected independently by Bankrate.com. The card details have not been reviewed or approved by the card issuer.