Best cash back credit cards for August 2022
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BEST FOR CUSTOMIZABLE REWARDS
U.S. Bank Cash+® Visa Signature® Card
Reward rate
5
5% cash back on your first $2,000 in eligible net purchases each quarter on the combined two categories you choose.
3
5% cash back on prepaid air, hotel and car reservations booked directly in the Rewards Travel Center.
-1
1% cash back on all other eligible purchases.
1
1% cash back on all other eligible purchases.
Intro offer
$200 bonus
Annual fee
$0
Regular APR
16.74% - 26.74% (Variable)
Recommended credit
Good to Excellent (670 - 850)
Pros
- Multiple rotating and fixed bonus categories, which can make it easier to earn rewards quickly
- The $200 sign-up bonus (after spending $1,000 within the first 120 days of account opening) increases the card’s first-year value
Cons
- The $2,000 combined spending cap each quarter for your chosen 5% categories limits your ability to rake in rewards
- Having to track and enroll in rotating categories can be a hassle for some
- New! $200 bonus after spending $1,000 in eligible purchases within the first 120 days of account opening.
- 5% cash back on your first $2,000 in combined eligible purchases each quarter on two categories you choose
- 5% cash back on prepaid air, hotel and car reservations booked directly in the Rewards Travel Center
- 2% cash back on one everyday category, like Gas Stations/EV Charging Stations, Grocery Stores or Restaurants
- 1% cash back on all other eligible purchases
- 0% Intro APR on purchases and balance transfers for the first 15 billing cycles. After that, a variable APR currently 16.74% – 26.74%
- No Annual Fee
- Pay over time by splitting eligible purchases of $100+ into equal monthly payments with U.S. Bank ExtendPay™ Plan.
- Terms and conditions apply.
ADDITIONAL FEATURES
Purchase intro APR
0% Intro APR on purchases for the first 15 billing cycles.
Balance transfer intro APR
0% Intro APR on balance transfers for the first 15 billing cycles.
BEST FOR PERSONAL LOAN ALTERNATIVE
Upgrade Cash Rewards Elite Visa®
Reward 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
8.99% - 29.99% (Variable)
Recommended credit
Good to Excellent (670 - 850)
Pros
- You won’t need to use your reward earnings to offset any maintenance fees.
- You’ll earn a bonus after you open a Rewards Checking account and make three purchases with the card in your first 60 days.
Cons
- The high end APR range is well above average. That could prove costly if you don’t have the credit needed to qualify for the lower range and you end up carrying a balance.
- You won’t get a break on interest if you carry a balance since there are no intro APR offers on purchases or balance transfers.
- $200 bonus on your Upgrade Card after opening a Rewards Checking account and making 3 debit card transactions within 60 days.*
- New Feature: Pay your balance in full early each month and avoid interest with EarlyPay.
- Earn 2.2% unlimited cash back on card purchases every time you make a payment
- See if you qualify in seconds with no impact to your credit score
- No Fees – $0 annual fees, $0 activation fees, $0 maintenance fees
- Combine the flexibility of a card with the low cost and predictability of a loan
- Access to a virtual card, so you can start earning while you wait for your card to arrive in the mail.
- Contactless payments with Apple Pay® and Google Pay™
- Mobile app to access your account anytime, anywhere
- Enjoy peace of mind with $0 Fraud liability
- *To qualify for the $200 welcome bonus, you must open and fund a new Upgrade Rewards Checking Account and make 3 debit card transactions within 60 days of your Upgrade Card account opening. The bonus credit will be posted to your Upgrade Card as a rewards credit within 1-2 billing periods following the third debit transaction on your Rewards Checking account. Your Upgrade Card must be in good standing to receive the bonus.
ADDITIONAL FEATURES
Purchase intro APR
N/A
Balance transfer intro APR
N/A
BEST FOR GAS
Blue Cash Everyday® Card from American Express
Reward rate
3
3% Cash Back at U.S. supermarkets on up to $6,000 per year in purchases, then 1%.
1
New! 3% Cash Back on U.S. online retail purchases, on up to $6,000 per year, then 1%.
-1
1% Cash Back on other purchases.
1
1% Cash Back on other purchases.
Intro offer
$200
Annual fee
$0
Regular APR
16.24%-27.24% Variable
Recommended credit
Good to Excellent (670 - 850)
Pros
- It carries one of the best combined cash back rates available at no annual fee at U.S. gas stations and U.S. supermarkets. Those two categories make up a big chunk of the average person’s budget.
- You can earn $7 back per month on The Disney Bundle streaming package, which includes Disney+, Hulu, and ESPN+ (each month you spend $13.99 or more on an eligible subscription, terms apply). To earn that much back in a month via the card’s 3 percent categories, you’d typically need to spend over $230.
Cons
- You’ll only earn 3 percent cash back on your first $6,000 in annual spending in each of the card’s bonus categories (then 1 percent). While that’s a high limit, it could hold you back if you’re sharing an account across multiple households.
- The card carries a 2.7 percent foreign transaction fee, so it’s not a good option if you’re looking for a single rewards card you can use at home and abroad.
- Earn a $200 statement credit after you spend $2,000 in purchases on your new Card within the first 6 months.
- No Annual Fee.
- Balance Transfer is back! Enjoy 0% intro APR on purchases and balance transfers for 15 months from the date of account opening. After that, 16.24% to 27.24% variable APR.
- 3% Cash Back at U.S. supermarkets on up to $6,000 per year in purchases, then 1%.
- New! 3% Cash Back on U.S. online retail purchases, on up to $6,000 per year, then 1%.
- 3% Cash Back at U.S. gas stations, on up to $6,000 per year, then 1%.
- Get $7 back each month after using your Blue Cash Everyday® Card to spend $13.99 or more each month on an eligible subscription to The Disney Bundle, which includes Disney+, Hulu, and ESPN+. Enrollment required.
- Terms Apply.
ADDITIONAL FEATURES
Purchase intro APR
0% on purchases for 15 months
Balance transfer intro APR
0% on balance transfers for 15 months
BEST FOR GROCERIES
Blue Cash Preferred® Card from American Express
Reward rate
6
6% Cash Back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%).
1
6% Cash Back on select U.S. streaming subscriptions.
3
3% Cash Back at U.S. gas stations
0
3% Cash Back at U.S. gas stations
1
1% Cash Back on other purchases
Intro offer
$350
Annual fee
$95
Regular APR
16.24%-26.24% Variable
Recommended credit
Good to Excellent (670 - 850)
Pros
- The base reward program is uber-lucrative, making this card a good choice for people looking for long-term value.
- You don’t have to keep track of rotating spending categories or enrollment deadlines.
Cons
- There is no intro APR offer on balance transfers.
- You won’t earn the extra rewards for grocery shopping at major superstores and wholesale clubs, as those don’t count as U.S. supermarkets.
- Earn a $350 statement credit after you spend $3,000 in purchases on your new Card within the first 6 months.
- Buy Now, Pay Later: Enjoy $0 intro plan fees when you use Plan It® to split up large purchases into monthly installments. Pay $0 plan fees on plans created during the first 12 months after account opening. Plans created after that will have a fixed monthly plan fee up to 1.33% of each purchase amount moved into a plan based on the plan duration, the APR that would otherwise apply to the purchase, and other factors.
- Low intro APR: 0% intro APR for 12 months on purchases from the date of account opening, then a variable rate, 16.24% to 26.24%.
- 6% Cash Back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%).
- 6% Cash Back on select U.S. streaming subscriptions.
- 3% Cash Back at U.S. gas stations and on transit (including taxis/rideshare, parking, tolls, trains, buses and more).
- 1% Cash Back on other purchases.
- Cash Back is received in the form of Reward Dollars that can be redeemed as a statement credit.
- $95 Annual Fee.
- Terms Apply.
ADDITIONAL FEATURES
Purchase intro APR
0% on purchases for 12 months
Balance transfer intro APR
N/A
BEST FOR ROTATING CASH BACK CATEGORIES
Discover it® Cash Back
Reward 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
13.49% - 24.49% Variable
Recommended credit
Good to Excellent (670 - 850)
Pros
- Discover will match the cash back you earn at the end of the first year.
- There are a few cash back redemption options, including credit to your account and donations.
Cons
- You must enroll to take advantage of the bonus categories each quarter.
- There is a spending limit on your highest cash back category each quarter ($1,500 in combined purchases per quarter).
- Intro Offer: Unlimited Cashback Match – only from Discover. Discover will automatically match all the cash back you’ve earned at the end of your first year! There’s no minimum spending or maximum rewards. You could turn $150 cash back into $300.
- 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. Plus, earn unlimited 1% cash back on all other purchases – automatically.
- New! Discover helps remove your personal information from select people-search websites. Activate by mobile app for free.
- Every $1 you earn in cash back is $1 you can redeem.
- New Intro APR: Get a 0% intro APR for 15 months on purchases. Then 13.49% to 24.49% Standard Variable Purchase APR applies, based on credit worthiness.
- No annual fee.
ADDITIONAL FEATURES
Purchase intro APR
0% for 15 months
Balance transfer intro APR
0% for 15 months
BEST FOR UP TO 2% CASH BACK
Citi® Double Cash Card
Reward 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
16.24% - 26.24% (Variable)
Recommended credit
Good to Excellent (670 - 850)
Pros
- You can convert your cash back earnings to Citi ThankYou points when paired with a card like the Citi Premier® Card, which can be redeemed for travel, gift cards and more.
- There are no spending category restrictions or rotating categories
Cons
- Your rewards can expire with this card if you don’t use it for a year.
- The sign-up bonus spending requirement is higher than you’ll find on many no-annual-fee cash back cards.
- Earn 2% on every purchase with unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases.
- For a limited time, earn $200 cash back after spending $1,500 on purchases in the first 6 months of account opening.
- Balance Transfer Only Offer: 0% intro APR on Balance Transfers for 18 months. After that, the variable APR will be 16.24% – 26.24%, based on your creditworthiness.
- Balance Transfers do not earn cash back. Intro APR does not apply to purchases.
- If you transfer a balance, interest will be charged on your purchases unless you pay your entire balance (including balance transfers) by the due date each month.
- There is an intro balance transfer fee of 3% of each transfer (minimum $5) completed within the first 4 months of account opening. After that, your fee will be 5% of each transfer (minimum $5).
ADDITIONAL FEATURES
Purchase intro APR
N/A
Balance transfer intro APR
0% intro for 18 months on Balance Transfers
A closer look at our top cash back cards
Capital One SavorOne Cash Rewards Credit Card: Best for dining and entertainment
- What we love about the Capital One SavorOne: It’s rare for a no annual fee card to earn such robust rewards rates in these particular categories in dining, entertainment, popular streaming services and grocery store categories.
- Who this card is good for: Socialites and social butterflies who will make the most out of the SavorOne’s very generous dining rewards.
- Alternatives: The Discover it Chrome card is another card that offers competitive rewards rates on dining. It also tacks on gas rewards which is great for people who are often on the go, something that the SavorOne falls a bit short on.
Blue Cash Preferred Card from American Express: Best overall cash back for families
- What we love about the Blue Cash Preferred: The rewards categories on this card are some of the most popular spending categories for most consumers so if you play your cards right (pun intended), you’ll have a nice stack of rewards in your cash back match in your first year.
- Who this card is good for: On-the-go people who spend a fair amount of money at gas stations and restaurants. You can earn 2 percent in those categories on up to $1,000 in combined purchases each quarter, then 1 percent.
- Alternatives: The Capital One SavorOne Cash Rewards card outpaces the Discover it Chrome by a lot if your main squeeze is getting the most out of dining rewards.
Citi Rewards+ Card: Best for rewards on small purchases
- What we love about the Blue Cash Preferred: Thanks to the Citi Rewards+ Round Up feature, every purchase you make will be rounded up to the nearest 10 points. For example, a $4 coffee would be worth 10 points.
- Who this card is good for: Frequent supermarket and gas station shoppers who want to earn cash back rewards easily without big spending habits.
- Alternatives: If you want to expand beyond the Citi ThankYou® Points program, the Capital One Quicksilver Cash Rewards Card offers unlimited flat-rate rewards on all purchases, casting a wide net on your earning opportunities outside of a designated points program.
What is a cash back credit card?
Types of cash back credit card rewards
Flat-rate cash back cards offer the same rewards rate for each eligible purchase. These cards are great for those who aren’t keen on activating and tracking bonus categories each quarter.Top examples include:
- Wells Fargo Active Cash
- Card (earns cash rewards)
- Citi Double Cash Card
- Capital One Quicksilver
- Cash Rewards Credit Card
If you prefer tiered category cards over flat rate cards, make sure you’re covered for all of the categories you spend within. If you aren’t, a 2 percent flat rate card could fill gaps in your rewards strategy.
Tiered cash back cards offer different rates of cash back for different types of purchases. For example, a tiered card may offer a boosted cash back rate of 3 percent on restaurant purchases, while all other purchases are rewarded with 1 percent cash back. The best way to maximize your cash back earnings is to have multiple tiered cards that reward your most common purchases at a high rate.Top examples include:
- Blue Cash Everyday Card from American Express
- Capital One SavorOne Cash Rewards Credit Card
Some credit cards offer bonus categories that change based on your preferences, your spending habits or the time of year. This can be an advantageous structure for those who don’t want to commit to specific bonus categories. Here are a few of the most common dynamic bonus category structures.
- Rotating bonus categories: With rotating categories, you’ll often get higher rewards rates, but these cards typically require enrollment each quarter to qualify. Unlike flat-rate cards, rotating bonus categories tend to set spending limits on how much you can earn in high rewards categories per quarter.
- Choose your own category: Some cards let you choose your cash back category on a monthly basis. With the option to change the monthly category, you can optimize your spending based on the category and plan out your year based on the cash back potential. For example, for the holiday months, you can opt into a category that will reward online purchases or department store purchases.
- Auto-optimizing bonus categories: This setup is a lot like the “choose your own category” structure. However, instead of having to determine which bonus category is going to benefit you the most, these cards will do the work for you. Usually, the card will retroactively apply the bonus rate to purchases within your top eligible category each month.
Top examples include:
- Discover it Cash Back
- Chase Freedom Flex
- Bank of America
- Customized Cash
- Rewards Card
Some cash back credit cards require a membership. These cards can often be quite lucrative. Co-branded cash back credit cards generally let you earn rewards and extra perks at specific stores or service providers. They often skip the annual fee, given you’ll need to pay for annual membership to enjoy the card’s benefits. Some credit unions also offer cash back card options to their members. Since credit unions are controlled and financed by members themselves, these members will often reap the benefits of more favorable interest rates and fewer banking and penalty fees that their not-for-profit institution provides. Membership requirements vary by credit union.Top examples include:
- Amazon Prime Rewards Visa Signature Card (requires an Amazon Prime membership, $119 a year)
- Costco Anywhere Visa Card by Citi (requires a Costco membership, at least $60 a year)
Sam’s Club® - Mastercard® (requires a Sam’s Club membership, starting at $45 per year)
- Alliant Cashback Visa Signature Credit Card (requires Alliant Credit Union membership)
The American Express network
American Express is both a payment processing network and a credit card issuer. That means Amex issues credit cards to consumers and facilitates transactions with merchants through their network. Networks, which include Visa, Mastercard and Discover as well as American Express, make money by taking a cut of each transaction they process.
Many, but not all, American Express credit cards are both issued by American Express and part of the American Express payment network.
Creditcard's Insight
Everyone should have a 2 percent cash back card, according to industry analyst and credit card expert Ted Rossman. They’re universally appealing and often come with no annual fee. Learn more on why you should have a 2 percent cash back card.
Pros and cons of Cash Back credit cards
- 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.
Commuters
With gas prices soaring to record highs, a cash back credit card can help minimize the pain at the gas pump. Cards that offer cash back on gas typically earn up to 3 percent back, but if you spend a lot of time on the road or drive a car that doesn’t get the best gas mileage, try to aim higher. Some customizable cash back cards earn up to 5 percent cash back in everyday bonus categories, including gas stations. Our pick for you: Citi Custom Cash℠ Card
Food lovers
If your card covers dining purchases, you’ll earn rewards at your favorite restaurants, from fast food to fine dining, and often even when ordering takeout through a food delivery service like DoorDash. And if your card earns grocery rewards, that may even include specialty food stores like delis, bakeries, candy stores and butchers. Our pick for you: Capital One SavorOne Cash Rewards Credit Card
However, if you cook more than you dine out, a sizable grocery bill is probably a given. Groceries are one of the most commonly rewarded purchases among cash back cards. The cash back you earn over the course of a year using your card at the supermarket could amount to a free week or two of groceries. Our second pick for you: Blue Cash Preferred Card from American Express
The minimalist
Even people who prefer the utmost simplicity — we’re talking longtime debit users — can find lots to love in a cash back card. A flat-rate, no annual fee cash back card is a great choice for someone who wants to earn rewards without much thought. Some cards even let you set up automatic bill payments and rewards redemptions for the ultimate “set and forget” rewards strategy. Our pick for you: Citi Double Cash Card
The student
The best time to build credit is before you really need it. That’s why it makes sense to use a credit card throughout your college years. Then, by the time you graduate and need a home or auto loan, you’ve spent years building an excellent credit score and earning cash rewards. Our pick for you:
The savvy spender
If you’re a money-saving pro, a cash back card can help your cause. Think of cash back as a tiny discount on every eligible purchase. Even if you only spent a modest $300 per month on a 2 percent cash back credit card, you’d earn $72 per year in cash back. It isn’t a staggering sum, but it could cover a fill-up or two at the gas station. Our pick for you: Whichever card matches your spending habits, whether that’s a card that rewards dining at restaurants, shopping for groceries, or something else.
If you’re really in it to maximize your cash back earnings, holding a combination of flat-rate and tiered cards is the way to go. Ideally, you would have a credit card that rewards you at a high rate for your largest and most frequent purchases, as well as a good flat-rate card for everything else. Our pick for you: Blue Cash Everyday Card from American Express.
American Express cardholders can access exclusive deals and additional rewards through Amex Offers. Benefits of Amex Offers include discounts, cash back and additional Membership Rewards points. Amex Offers vary by card, and cardholders must activate to qualify. Limits and expiration dates may apply.
When you shouldn’t get a cash back card
Whether or not you should get a cash back credit card is going to depend on your personal situation and needs. 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:
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.
Be sure you’re accounting for your lifestyle when deciding between cash back cards. A card that earns a 2 percent flat rate might seem like a great deal, and it can be, but if you spend more on dining out, it might be best to focus on a card that offers 5 percent back on dining and 1 percent cash back on everything else.
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.
Each cash back program will vary in how you can redeem rewards. Some cards only allow cardholders to redeem rewards once they’ve reached a certain minimum. For example, the Alliant Cashback Visa Signature offers cardholders a solid 2.5 percent cash back rate, but the redemption minimum is $50. On the other hand, there are cash back cards that allow for redemption of any amount, which might make more sense for some cardholders.
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.
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
Creditcard's 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.
7 ways to maximize cash back
- 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.
- 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.
- Enroll/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.
- Target your spending. In order to get the most out of a bonus category, try to max out the spending limit for the quarter. For example, Discover’s 2022 bonus categories for July through September are restaurants and PayPal. By maxing out all of the bonus 5 percent categories (capped at $1,500 in spending each quarter, then 1 percent, activation required), you’ll earn $75 in cash back for that quarter.
- 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.
- 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.
- Don’t spend for the sake of earning. Keep from spending in excess to what you normally spend just because you’ll earn a small percentage of cash back.
Creditcard's 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.
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:
- Cash Back Advice
- Cash Back Credit Card Reviews
- How recent Senate bill impacts rewards for credit card users
How we chose our top American Express credit cards
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.
Frequently asked questions about credit cards for excellent credit scores
Since cash back cards come with different bonus categories, spending caps, annual fees and other features, the card that earns you the most cash back overall will depend on a number of factors, including your spending habits.
For example, if you have good-to-excellent credit and spend heavily on groceries, the Blue Cash Preferred will earn the most cash back, thanks to its best-in-class 6 percent cash back rate at U.S. supermarkets (excluding superstores, on up to $6,000 in spending per year, after which you’ll earn 1 percent back). Maxing out that bonus category alone would get you $360 cash back, plus plenty of chances to earn rewards in other common categories, including gas, transit, and select U.S. streaming services.
But if you have fair credit or prefer the prices at superstores, the Capital One Walmart Rewards® Mastercard® is a solid pick thanks to its impressive 5% cash back rate on Walmart.com purchases, including grocery pickup and delivery orders.
A cash back card typically offers a few simple ways to redeem your rewards, including:
- Statement credits
- Checks payable to you
- Direct deposits into one of
- your bank accounts
- Gift cards
- Charitable donations
Generally, the cash back earned with a credit card is not considered taxable income. Learn more about what credit card rewards can be considered taxable.
You may not receive cold, hard cash, but issuers offer redemption options like a direct deposit into a checking account, mailed checks, statement credits or gift cards.
Many cards offer cash back rewards that never expire, as long as your account remains open and in good standing. However, not every issuer has this policy, so it’s best to check the terms and conditions before appling.
When deciding between a cash back card or a travel card, explore the type of benefits you would most like to reap, the main difference being earning travel-specific rewards or basic cash back rewards.