Some savvy consumers only use credit cards to enjoy the cash back. No need for travel rewards or other perks. They just want a percentage back on their purchases. And they want this percentage back to come in the form of a cash back check whenever they want. It wasn’t long ago that the best cash back credit cards were going unused. Now, many consumers are playing the cash back game.
I cash in at least $200 annually in rewards from cash back credit cards and I never pay a dime in credit card interest. So how do you find the best cash back card? Well, it really depends on a few factors: how you earn the points, access and thresholds, as well as any fees or interest charges that might negate the use of the card.
In the below list of cash back credit cards, I’ve tried my best to consider all the factors above and give you a thorough review of each of the cards.
PT’s Pick for Best Cash Back Card
Blue Cash from American Express – Blue Cash is a regular credit card, not a charge card. And it offers one of the most attractive cash back rewards programs out there. For the first $6,500 in spending, you will earn 0.5% on general purchases and 1% on “everyday purchases.” Every dollar spent above $6,500 will earn 1.25% on general purchases and a nice 5% on “everyday purchases.” Everyday purchases include gas, groceries, and drugstore purchases. American Express wants this to be your #1 credit card and use it on everything. If you do, they will reward you with a lot of cash back. The card has no annual fee.
For the typical credit card cash back chaser, I think this is the best card. Most people going for cash back want to get as many cash back rewards as possible and will use their rewards credit card for everything. Since most people spend far more than $6,500 in annual expenses, I think this card produces the most value for the largest group of people. Plus, there are no fees or hoops to jump through to trip you up. Of course, everyone’s situation is unique. How you spend your money and what groups you’re a member of may have an affect on what card is best for you. I suggest you at least browse the other card choices below.
Discover® More Card – $75 Cashback Bonus – Some cash back credit cards only allow you to earn rewards at a base percentage of 1%. Not the Discover® More Card – $75 Cashback Bonus. With this card, you are allowed to earn rewards up to 5% in certain categories. The categories changes from quarter to quarter and include things like travel, groceries, home improvements, and gasoline. This card also comes with a very nice initial balance transfer offer, as well as a great initial cash back bonus of $75 after a certain amount of spending. There is no annual fee.
Chase Freedom® Visa – $50 Bonus Cash Back – This card definitely catches your eye because of the 5% cash back you can earn based on rotating categories, like gas, travel, home improvement, dining, and groceries among many others. The categories change each quarter and the rewards you can earn at 5% are subject to a maximum. You also earn 1% cash back on everything else, and it comes with no annual fee and a cash back bonus of $50 when you make your first purchase. This is actually the cash back card that I currently use. However, I’m not a big fan of the opt-in rotating categories. Therefore, I can’t give this card the top spot. See my full Chase Freedom® Visa – $50 Bonus Cash Back review.
Citi Dividend Platinum Select Card – If you need a nice cash back rewards card coupled with one of the best balance transfer offer on the market, then this is your card. The Citi Dividend Platinum Select Card has a 0% Intro APR on Balance Transfers for 15 months. After that, the APR will be 12.99%-20.99% based on your creditworthiness*. You can earn 5% cash back at restaurants and on car rentals and hotels from 7/1/10 to 9/30/10. Enrollment required each quarter. You also earn a full 1% cash back on eligible purchases and cash advances. You can even earn extra cash back on popular, rotating categories each quarter. This card has no annual fee.
Capital One No Hassle Cash Rewards – You’ve seen the commercials. Capital One prides themselves on being the no hassle reward company. And they have a pretty decent program for earning those rewards. They offer 3% cash back on gas at the pump and at major grocery stores, and 1% back on everything else. This is after $6,000 in spending. My only issue with this card is the annual fee of $39. This would negate some of the cash back you’d be earning. Head’s up international travelers. This card doesn’t charge foreign transaction fees for international use. That’s an instant savings of 1% on all your spending overseas.
TrueEarnings Card from Costco and American Express – If you are already a Costco member heavy user of the warehouse, then there is no question which is the best cash back card for you. This is it. As a Costco member, you are already paying your annual membership, so you’ll avoid the annual fee ($50). And the rewards you can earn are excellent. You can earn 3% cash back on gasoline (up to $3,000), 3% cash back on restaurants, 2% cash back on travel, and 1% on everything else. I don’t know about you, but gas and dining out are two of my biggest expenses, making this card an excellent choice. The only reason it’s not my top pick is because of the tie in to Costco’s membership. The card comes with a $25 statement credit after your first purchase. See more at my TrueEarnings review.
PenFed Platinum Cashback Rewards – The Pentagon Federal Credit Union has a nice cash back card for their members. It offers 2% cash back for supermarket purchases, 5% cash back for gas paid at the pump, and 1% cash back on everything else. They also have the occasional promotional category similar to other cards. In addition to those benefits, the card comes with a nice initial balance transfer rate. The only reason this isn’t my top pick is that you have to jump through the hoop of becoming a PenFed member if you aren’t already associated with the military in some way. This extra step and membership fee ($20) brings the value of the card down a bit in my mind. Although, I have a hard time saying a card that offers those cash back percentages is not the best.
Amazon Rewards Visa Card from Chase – With this card, you earn 3 cash back points for spending at Amazon.com, 2 points for each dollar spent at gas stations, restaurants, and drug stores. Every other dollar earns 1 point. The points can be converted to cash at the 5000 point level. No annual fee, no points expiration, plus you get an instant $30 cash back. If you do a lot of purchasing on Amazon, then you should definitely consider using this card.
Cash Back from a Debit Card
PerkStreet Financial(SM) Visa® Debit Card – While it’s not a true credit card, the PerkStreet Financial(SM) Visa® Debit Card is a great way to get cash back rewards without using credit. PerkStreet offers a standard 2% cash back on everything as long as you maintain a balance of $5,000 in your checking account. Also, you have the opportunity to earn 5% cash back in rotating categories. The checking account is free and they have a bunch of free ATMs. Nice alternative to the traditional cash back credit card. See more at my PerkStreet 5% review.
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