Key takeaways

  • There are some cards that allow you to automatically earn rewards in your top spending categories without opting in
  • The advantage for you is that you don't need to put in an effort to identify certain categories to earn rewards each period
  • It's better to use these cards as part of your broader credit card rewards strategy rather than to channel all your spending to them

If you’re the kind of person who likes to maximize rewards but doesn’t want to put in a lot of work, a new trend could work to your benefit. Several credit cards now let you earn rewards in your top spending categories without requiring you to preselect them.

Consumer card examples

  • The Citi Custom Cash® Card gives 5 percent cash back on your top eligible spending category each billing cycle (up to $500 in purchases, then 1 percent), and everything else earns 1 percent cash back. Eligible purchases include restaurants (not including third-party dining services); gas stations; grocery stores; select travel; select transit; select streaming services; drugstores; home improvement stores; fitness clubs; and live entertainment.
  • The Venmo Credit Card* doles out unlimited 3 percent cash back on your top eligible spending category each month and 2 percent on your second-largest category. All other purchases earn 1 percent cash back. The eligible categories are travel; dining and nightlife; groceries; entertainment; and bills and utilities.
  • The Chase Freedom Flex℠* offers 5 percent cash back on activated bonus category purchases each quarter (up to $1,500 in purchases, then 1 percent), Chase Ultimate Rewards travel purchases and eligible Lyft purchases (Lyft offer through March 2025). Although the rotating categories must be activated, you can also automatically earn 3 percent cash back on drugstore and dining purchases (including restaurants, takeout and eligible delivery services). All other eligible purchases earn 1 percent cash back.

Business card examples

  • The World of Hyatt Business Credit Card* earns up to 9X points on Hyatt hotel purchases (4X points, plus another 5X points as a World of Hyatt member). Additionally, this card offers an unlimited 2X points on cardholders’ top three eligible spending categories each quarter through Dec. 31, 2024, then drops to the top two categories afterward. Eligible categories include dining; shipping; airline tickets purchased directly from airlines; local transit and commuting; social media and search engine advertising; car rental agencies; gas stations; and internet, cable and phone services. Eligible fitness club and gym memberships also earn 2X points, but all other eligible purchases earn 1X points.
  • The American Express® Business Gold Card earns 4X points on up to $150,000 per year in two select categories your business spends the most on each billing cycle (then 1X points). Those categories include airfare purchased directly from airlines; advertising (purchased in the U.S. to promote your business online, on TV or on the radio); U.S. gas stations; U.S. restaurants; U.S. shipping costs; and U.S. computer software, plus hardware and cloud data purchases made directly from select providers.

What’s in it for you 

The pitch is that you can spend as you normally would; the card issuers point out that there’s no need to preselect categories or jump through any special hoops. This may benefit the issuer more than it helps you, however, because your non-bonus spending often earns lackluster benefits.

Let’s say you spend $2,000 per month on the Citi Custom Cash. If at least $500 is in one of the eligible categories, it’s nice that one month you might maximize travel, and then maybe the next month it’s groceries or home improvement stores and so on. That’s a streamlined process that caters to someone with varied spending habits who doesn’t want to put in much legwork. But what about your other spending?

If you earned $25 cash back by spending $500 in one of the Custom Cash’s 5 percent categories, the other $1,500 that you spent only earned $15 (a 1 percent return). In total, you got $40 back on $2,000 in spending (an overall return of 2 percent). If you spend more than $2,000 per billing cycle on this card, you’ll come out ahead with a no-annual-fee, 2 percent cash back card such as the Citi® Double Cash Card (which technically gives 1 percent cash back when you make a purchase and another 1 percent when you pay it off).

These cards are useful as part of a broader rewards strategy

As you can see, if you use one of these cards for all your spending, you’re not getting the best bang for your buck. But if you truly want to maximize your credit card rewards, these cards can be useful as part of a broader multi-card portfolio.

You could use a 2 percent cash back card as a solid foundation and surround it with cards that emphasize categories in which you spend a lot of money. The Citi Custom Cash and the Venmo Card would be particularly well suited for some of the less offered categories — such as home improvement stores, fitness clubs, entertainment and bills and utilities — since these aren’t as common. There are many more cards to choose from that offer enhanced dining, grocery, travel and gas rewards.

Or, if you really want simplicity, a 2 percent cash back card is a solid choice. Chances are a card that gives 2 percent cash back on everything would outpace one that only offers a better return on a single category if you spend enough.

Have a question about credit cards? E-mail me at ted.rossman@bankrate.com and I’d be happy to help.

*All information about these cards has been collected independently by Bankrate and has not been reviewed or approved by the issuer.