Credit Card Review: American Express Blue Cash Preferred
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Update: If you are a new Amex cardholder, you will get more time for welcome offer spending due to unprecedented circumstances related to the coronavirus pandemic.
The U.S. credit card industry has undergone some major changes in recent years as credit card rewards gain in popularity. American Express has updated its most popular rewards cards to keep them relevant for modern consumers. The issuer has now turned its attention to its cash-back card portfolio, starting with a makeover to the Blue Cash Preferred® Card from American Express.
The card has two new bonus categories, including an industry-leading 6% cash back for U.S. streaming services and 3% back on transit purchases. Let’s take a look at the ins and outs of this card to help you decide if it’s right for you.
Who is This Card For?
There are pros and cons to picking a cash-back card over a travel rewards card, but if you don’t travel frequently and want the flexibility to spend your rewards in other ways, the Blue Cash Preferred might be right for you. The unique and high-value bonus categories set this card apart from a simple option like the Citi® Double Cash Card. The Blue Cash Preferred is for discerning customers looking for a rewards credit card to maximize their returns in specific bonus categories.
Current Bonus and Fees
Cash-back credit cards rarely offer sky-high bonuses like travel rewards cards do, and the Blue Cash Preferred is no exception. New applicants can receive a $250 statement credit after spending $1,000 within the first three months. While that’s definitely on the smaller side as far as bonuses go, the relatively low spending requirement makes up for it.
Unlike the Amex changes to the Platinum and Gold cards late last year, the updates to the Blue Cash Preferred come without any change in the card’s annual fee. The fee will stay at $95 a year (see rates and fees), though the card also charges a 2.7% foreign transaction fee (see rates and fees). Most of the bonus categories are limited to U.S. purchases anyway, so this clearly isn’t the best card to bring on vacation with you.
The standout features of the Blue Cash Preferred is its various cash back bonus categories, which seek to reward you day in and day out. The categories are as follows:
- 6% back on U.S. streaming subscriptions
- 6% back at U.S. supermarkets (up to $6,000 a year, then 1% thereafter)
- 3% back on transit (parking, tolls, ride-sharing, subway, etc.)
- 3% back at U.S. gas stations
- 1% everywhere else
The recent refresh saw the removal of a 2% bonus category at select U.S. department stores, but the replacement categories of streaming services and transit will likely be much more appealing to the average customer. While the Blue Cash Preferred is not the first card to offer a bonus multiplier on the growing industry of streaming subscriptions, its rate of 6% cash back is the most any card is offering.
In addition to this change, the Amex Blue Cash Preferred is a rewarding card at both the supermarket check out and gas pump, earning 6% cash back and 3% cash back respectively.
And with the exception of the 6% US supermarkets bonus, none of the other categories have an annual cap on how much you can earn. Still, you’ll have to analyze your spending patterns to make sure you’ll earn enough cash back to offset the card’s $95 annual fee (see rates and fees).
While cash-back credit cards aren’t going to unlock the doors to $10,000 first-class airplane suites, there’s also no pressure to save up for a specific reward. With the Blue Cash Preferred, you can cash out your rewards any time your available balance is more than $25.
You have three redemption options:
- Receive a statement credit
- Redeem for gift cards
- Shop with your rewards
No matter what you plan to use this extra money for, I suggest always redeeming for a statement credit. If you plan to purchase gift cards or go shopping you can simply put that purchase on your credit card, earn even more cash-back rewards, and then erase the purchase from your statement with your existing cash back balance. Keep in mind that it can not be used to pay your minimum payment.
You’re not going to find as many perks on low-fee cash-back cards as you can on premium travel rewards cards, but the Blue Cash Preferred has a few nice features worth mentioning:
- 0% APR on purchases for 12 months (see rates and fees) (then a variable rate of 13.99%-23.99%) (see rates and fees)
- Secondary car rental insurance when you pay for the entire rental with your Blue Cash Preferred
- Up to two years of extended warranty
- Return protection
- Access to Amex Offers
With the exception of the 0% intro APR offer, most of these perks fall into the category of things you hope to never need, but it’s nice to have if you do. These perks also aren’t going to do much to offset the card’s annual fee, so you really have to make sure you’re getting enough value from the cash back itself.
Which Cards Compete With the Blue Cash Preferred?
The Amex EveryDay® Preferred Credit Card from American Express has a very similar structure to the Blue Cash Preferred card, but it replaces cash-back earnings with valuable transferable Amex Membership Rewards points. You’ll earn 2x points at U.S. gas stations and 3x points at U.S. supermarkets (up to $6,000 spent a year), as well as a 50% point bonus when you use your card to make 30 or more transactions in a single billing period. While it doesn’t offer as many unique bonus categories as the Blue Cash Preferred, based on TPG’s valuation of Membership Rewards points at 2 cents each, it’s a great choice for grocery and gas purchases. The information for the Amex Everyday Preferred has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.
It’s great to see Amex adding value for existing Blue Cash Preferred card holders and new applicants alike, and it’s even better that it’s doing so without raising the annual fee. While the 6% cash back on streaming services is very appealing, many people will have a hard time justifying the annual fee on this cash-back card when they could be earning transferable points instead.
For rates and fees of the Blue Cash Preferred, please click here.
Welcome to The Points Guy!
WELCOME OFFER: $250 Cash Back Terms Apply.
TPG'S BONUS VALUATION: $250
CARD HIGHLIGHTS: New! Earn 6% cash back on select U.S. streaming services and 3% cash back on transit. Plus earn 6% Cash Back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%) and 3% Cash Back at U.S. gas stations
- Earn a $250 statement credit after you spend $1,000 in purchases on your new Card within the first 3 months.
- 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.
- Low intro APR: 0% for 12 months on purchases from the date of account opening, then a variable rate, currently 13.99% to 23.99%.
- Plan It® gives the option to select purchases of $100 or more to split up into monthly payments with a fixed fee and no interest.
- Cash Back is received in the form of Reward Dollars that can be redeemed as a statement credit.
- $95 Annual Fee
- Terms Apply.
- See Rates & Fees