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Americans spend more annually on groceries than any other major household expense that can be easily paid for with a credit card. You should have a rewards card that maximizes this big chunk of your budget. But unlike with travel rewards credit cards where the choices are plentiful, there are only a handful of points and cash back cards that offer groceries as a bonus category — and nearly all of the top choices come from one issuer, American Express.
Still, that doesn’t mean it’s hard to find a card that pays more than 1 cent per dollar on your supermarket shopping. We found five credit cards that pay rewards worth $190 or more annually for the typical household. Consumer expenditure data from the Bureau of Labor Statistics shows the average household spends $4,363 on “food at home,” so $190 is enough to buy more than two weeks of groceries for free each year. And if your grocery budget is bigger, you stand to benefit even more from a rewards card tailored for grocery spending.
The 5 Best Credit Cards for Groceries
First, let’s take an overall look at the five best cards to have when you’re at the supermarket, ranked by value on grocery spend:
|Earning Rate at US Supermarkets||Annual Fee||Value of Points (based on TPG valuations)||Total Value Per Dollar Spent|
|The Amex EveryDay® Preferred Credit Card from American Express||3x points up to $6,000 per year, then 1x, plus a 50% bonus when you use the card 30 times a month. Terms Apply||$95||2 cents each||9 cents|
|American Express® Gold Card||4x points up to $25,000 per year; then 1x. Terms Apply.||$250 (See Rates & Fees)||2 cents each||8 cents|
|Blue Cash Preferred® Card from American Express||6% cash back up to $6,000 per year; then 1%. Terms Apply.||$95 (See Rates & Fees)||N/A||6 cents|
|Target REDcard||5% savings on qualifying purchases at Target||None||N/A||5 cents|
|The Amex EveryDay® Credit Card from American Express||2x points up to $6,000 per year, plus a 20% bonus when you use the card 20 times a month. Terms Apply.||None||2 cents each||4.8 cents|
Let’s dive deeper into the details of these credit cards, including not only the bonuses on grocery store spending, but also the total first-year value of each one.
Grocery rewards: Earn 3x points at US supermarkets, on up to $6,000 per year in purchases (then 1x).
Other rewards and perks: Earn 2x points at US gas stations and 1x points on other purchases. Use your card 30 or more times on purchases in a billing period and earn 50% more points on those purchases less returns and credits.
Welcome bonus: Earn 15,000 Membership Rewards points after you make $1,000 in purchases in your first three months.
Annual fee: $95
Estimated annual cash back/points from grocery spending: 13,089 points valued at $262 if you make less than 30 transactions each month (or 19,633 points valued at $393 if you make 30 or more transactions each month)
Keep in mind: Since this card is part of Amex’s Membership Rewards program, points are more valuable than the standard 1 cent each you’ll find with most cash-back cards. According to TPG’s latest valuations, Membership Rewards points are worth 2 cents apiece. That means for every dollar spent at a grocer, you’ll earn 3 points worth 6 cents. Then if you hit 30 monthly transactions, those 3 points per dollar spent turn into 4.5 points per dollar spent worth 9 cents apiece, making this the most valuable grocery card available.
Taking into account the welcome bonus and annual fee, I estimate a typical card holder who paid for nothing but groceries with this card could earn at least $467 during the first year of card membership. (I did not take into account the potential transaction bonus in this figure.) The information for The Amex EveryDay® Preferred Card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.
Grocery rewards: Earn 4x points at US supermarkets, on up to $25,000 per year in purchases (then 1x).
Other rewards and perks: Earn 4x points at US restaurants, 3x points on flights booked directly with airlines or on amextravel.com and 1x points on other purchases. Earn up to $10 in statement credits monthly when you pay with your card at participating partner restaurants. Receive up to $100 annually in travel credits when the qualifying airline you choose charges you incidental fees.
Welcome bonus: Earn 35,000 Membership Rewards points after you make $2,000 in purchases in your first three months.
Annual fee: $250
Estimated annual cash back/points from grocery spending: 17,452 points valued at $349
Keep in mind: Although this card has great supermarket and restaurant bonuses, you’ll want to use a different card on gas purchases. Make sure you use the monthly dining credits as well as the annual airline fee credit, since these credits can effectively offset the annual fee.
Grocery rewards: Earn 6% cash back at US supermarkets (on up to $6,000 per year in purchases, then 1%).
Other rewards and perks: Earn 3% cash back at US gas stations and 1% back on other purchases.
Welcome bonus: Receive a $200 statement credit after you spend $1,000 in purchases within the first three months.
Annual fee: $95
Estimated annual cash back/points from grocery spending: $262
Keep in mind: When it comes to earning grocery rewards, not all stores are treated equally. American Express says you won’t earn 6% cash back at the following types of stores:
- Specialty stores like fish markets, cheese shops and wine shops
- Superstores, like Amazon, Target and Walmart
- Warehouse clubs like BJ’s Club
Including the welcome bonus and annual fee, the typical card holder could earn at least $367 on groceries during the first year of card membership.
Grocery rewards: Earn 5% savings on qualifying purchases at Target.
Sign-up bonus: None
Annual fee: None
Estimated annual cash back/points from grocery spending: $218
Keep in mind: Target offers the REDcard as either a debit or credit card. Since this card is only valid at Target, my math assumes you’ll do all of your grocery shopping at Target — it doesn’t take into account any other shopping you might do at the large retailer. Also, unlike with other cards, you won’t actually redeem anything — you’ll just save 5% at checkout.
Since there’s no annual fee or welcome bonus, the estimated first-year value is the same as the estimated grocery spending savings.
5. The Amex EveryDay® Credit Card from American Express
Grocery rewards: Earn 2x points at US supermarkets, on up to $6,000 per year in purchases (then 1x)
Other rewards and perks: Earn 1x points on other purchases. Use your card 20 or more times on purchases in a billing period and earn 20% more points on those purchases less returns and credits.
Welcome bonus: Earn 10,000 Membership Rewards points after making $1,000 in purchases in your first three months.
Annual fee: $0
Estimated annual cash back/points from grocery spending: 8,726 points valued at $175 if you make less than 20 transactions each month (or 10,471 points valued at $209 if you make 20 or more transactions each month)
Keep in mind: I estimate the first-year value of the Amex EveryDay to be worth $375 (not taking into account the potential transaction bonus). This card earns less than the EveryDay Preferred, but it doesn’t have an annual fee. Looking long term, if you’ll only put groceries on these cards then the break-even point between the EveryDay and EveryDay Preferred is when your annual grocery bill is $4,750. If you spend significantly less on groceries annually, the Amex EveryDay card will likely be the better choice. The information for The Amex EveryDay® Card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.
If you’re willing to put in some work, using business credit cards with an office supply store bonus — like the Ink Business Cash Credit Card or the SimplyCash® Plus Business Credit Card from American Express — to buy gift cards toward grocery shopping could help you earn 5% cash back (up to $25,000 per year for the Ink Cash and up to $50,000; then 1% for the Simply Cash). There aren’t necessarily a lot of grocery options to choose from, however, as Staples is showing just two grocery-related gift cards online: Whole Foods and Safeway. Of course, you may find more options in the chain’s physical stores. The office supply chain limits online gift card purchases in any one order to $2,000 or less “due to federal anti-money laundering regulations.”
A few cards like the Chase Freedom and Discover it® Cash Back offer quarterly bonuses in rotating categories, upon enrollment. For January, February and March of 2019 the Discover it Cash Back will feature 5% cash-back on up to $1,500 in purchases at grocery stores. And, since cardholders get their cash-back matched in this first year after opening their account, you’ll earn up to 10% back if you’re a new cardholder. For Discover it cardholders still within their first year, this is a great return on grocery spending.
There are also two other cards that have lower grocery reward returns, but when combined with their welcome bonuses and lack of an annual fee, offer high overall first-year value. Those are the Chase Freedom Unlimited with a first-year return of $215 and the basic Hilton Honors Card from American Express with a first-year return of $581.
Everybody needs groceries, so you should be taking advantage of a card that offers bonus categories for supermarket shopping. Just keep in mind that the best card for groceries may not be the same card you should be using on other transactions, such as when you dine at a restaurant (Amex Gold not withstanding) or fill up at a gas station. But before you head to the grocery store, make sure at least one of the above cards is in your purse or wallet in order to rack up plenty of travel rewards or cash back.
Featured image by Rawpixel via Unsplash.
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With some great bonus categories, the American Express Gold Card has a lot going for it. The card offers 4x points at US restaurants, at US supermarkets (up to $25,000; then 1x), and 3x points on flights booked directly with airlines or through amextravel.com. It is currently offering a welcome bonus of 35,000 bonus points after you spend $2,000 in the first three months.
- Earn 35,000 Membership Rewards® Points after you spend $2,000 on eligible purchases with your new Card within the first 3 months.
- Earn 4X Membership Rewards® points at U.S. restaurants. Earn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per year in purchases, then 1X).
- Earn 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.
- Earn up to $10 in statement credits monthly when you pay with The Gold Card at Grubhub, Seamless, The Cheesecake Factory, Shake Shack, and Ruth's Chris Steak House. This is an annual savings of up to $120. Enrollment required.
- $100 Airline Fee Credit: up to $100 in statement credits per calendar year for incidental fees at one selected qualifying airline.
- Choose to carry a balance with interest on eligible charges of $100 or more.
- No Foreign Transaction Fees.
- Annual Fee is $250.
- Terms apply.
- See Rates & Fees