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Let’s talk cash-back credit cards. Many of my friends and family members want to know how I travel so much, but when I start explaining the various strategies of multiple credit cards, transferable points and online shopping portals, their eyes inevitably start to glaze over. Fortunately, many card issuers provide simpler reward options, so today I want to go over the top cash-back credit cards.
Many of the best travel rewards credit cards allow you to earn cash back on your purchases, but you’re usually forgoing better value redemptions to do so. So in this guide, we mainly consider cash-back credit cards where getting cash back is the redemption that provides the best return.
We’ll get into the details of each of the best cash back cards, but here’s an overview of the best cash-back cards in the most popular spending categories:
- Dining: Capital One Savor Cash Rewards Credit Card (4%), Uber Visa Credit Card (4%)
- Travel: Wells Fargo Propel American Express® Card* (3x), Uber Visa Credit Card (3%), Bank of America Premium Rewards credit card (2x points)
- Gas: Blue Cash Preferred® Card from American Express (3%)
- Grocery stores: Blue Cash Preferred Card from American Express (6%, on up to $6,000 per year; then 1x)
- Purchases that might need shopping protections: Citi Double Cash Card (2%; 1% when you buy, plus 1% as you pay)
- Office supplies: Ink Business Cash Credit Card (5%, on up to $25,000 in combined spending per year)
- Select streaming services: Wells Fargo Propel American Express® Card (3x)
- Flat-rate cash back: Citi Double Cash Card (2%), Chase Freedom Unlimited (1.5%), Capital One Quicksilver Cash Rewards Credit Card (1.5%), Bank of America Premium Rewards credit card (1.5x points), Discover it® Miles (1.5%, matched first year)
- Rotating bonus categories: Chase Freedom (5%), Discover it® Cash Back (5%, matched first year)
- Flexible bonus categories: U.S. Bank Cash+ Visa Signature Card (5% and 2%), Bank of America Cash Rewards credit card (3%)
Some issuers market options like the Barclaycard Arrival Plus World Elite Mastercard as cash-back cards. However, the most valuable redemption for your miles on this card is a statement credit that covers a travel expense. Since redeeming miles for straight-up cash back isn’t the best option, I’ve left these cards off the list.
How to Choose the Best Cash-Back Credit Card for You
So what things should you look for when you’re comparing credit cards that offer cash back? Here are some factors to consider:
- Earning rates: How much cash back will you earn? Is it consistent across all purchases, or does the card restrict the best rates to specific types of purchases? Since cash back by definition provides you with money to go back in your wallet, there isn’t any way to truly “maximize” the points or miles you earn. Instead, be sure to evaluate the exact earning rates compared to your typical spending patterns.
- Ease of redemption: Not all cash-back cards are created equal when it comes to actually getting the cash in your hands or bank account. Some post rewards automatically to your statement, while others earn you points/miles that can then be redeemed for cash back or for statement credits to offset specific purchases. Be sure to read the terms and conditions of the rewards program carefully so you know how (and when) you’ll actually put your hands on the money.
- Additional perks: A third factor involves the additional perks provided on the card. Does it incur foreign transaction fees? What about coverage and added protection for your purchases or trips? These benefits can add significant value to a card.
- Annual fee: A final aspect to consider is any possible annual fee. The majority of the cards below don’t charge an annual fee, but there are a handful of cash-back cards that do. It’s critical to crunch the numbers to see if the annual fee is offset by the earning rates on the card.
What Is the Best Cash-Back Credit Card for You?
Given these factors, it can be quite challenging to determine if a card would make a good addition to your wallet. As a result, I’d recommend using the process of elimination. Start by looking at the four factors above and figure out which is most important to you. Then, start whittling away at the contenders. If you abhor annual fees, cross off cards that require an upfront investment. If you crave simplicity, ignore cards with confusing rotating bonus categories or convoluted redemption schemes. By focusing in on the perks that mean the most to you, you’ll be able to quickly narrow the list down to one or two contenders to earn a spot in your wallet.
So, which cash-back cards should be included on your initial list?
Welcome bonus: $500 back after you spend $3,000 in the first three months
The Capital One Savor Cash Rewards Credit Card is a great choice for eating out as well as for purchasing tickets to a variety of events due to its 4% back on dining and entertainment. Plus, the card offers 2% back at grocery stores and 1% back on everything else. Its welcome bonus is one of the best among cash back cards, too.
Welcome bonus: $500 cash back after you spend $3,000 on purchases in the first three months after account opening
If you’re looking for a business card that offers solid value from a cash-back standpoint, the Ink Business Cash Credit Card is a terrific option. You’ll earn 5% cash back on the first $25,000 spent in combined purchases at office supply stores and on phone, internet and cable services each account year. You’ll also earn 2% cash back on the first $25,000 spent in combined purchases at gas stations and restaurants each account year plus 1% cash back everywhere else. Plus, the card has purchase protection, extended warranty protection and primary car rental coverage when renting a vehicle for business purposes.
All of this is available without an annual fee, though there is a 3% foreign transaction fee for purchases made abroad. However, if you have the Ink Plus (no longer accepting new applicants), Ink Business Preferred Credit Card, Chase Sapphire Reserve or Chase Sapphire Preferred Card, you can actually convert the cash-back points from the Ink Cash to much more valuable Ultimate Rewards points. This would essentially double the value you’d get from your spending, as TPG pegs these points at 2 cents apiece.
Welcome bonus: $200 back after you spend $1,000 in purchases on your new card in your first three months
Another card with some intriguing bonus categories is the Blue Cash Preferred Card from American Express. You’ll get 6% cash back on purchases at US supermarkets (on up to $6,000 of spending each reward year, then 1%) plus 3% cash back at US gas stations, and 1% cash back everywhere else. These earnings accumulate as reward dollars and can be redeemed for statement credits when you have a rewards balance of at least $25.
The card has a $95 annual fee, but offers return protection, extended warranty protection and purchase protection. It charges a 2.7% foreign transaction fee though, so while it’s a great option for use in the US, you’d be better off with some of the other options if you frequently travel outside the country.
Welcome bonus: $150 cash back after you spend $500 on purchases in your first three months from account opening.
The Chase Freedom offers a standard 1% cash back on all purchases, which (obviously) isn’t that exciting. However, this earning rate jumps to 5% cash back on up to $1,500 in combined purchases at merchants in the card’s quarterly bonus categories. Previous quarters have awarded bonus points on mobile wallets, gas stations and cable purchases or Walmart and department stores, giving you a variety of options throughout the year.
The Freedom’s rewards actually accrue as points that are worth 1 cent apiece toward cash back; you can choose to deposit the cash into a bank account or apply it as a statement credit. However, this card becomes even more lucrative when it’s paired with a card that accrues Ultimate Rewards points, like the Chase Sapphire Preferred Card. If you link that card to the same Chase online account as the Chase Freedom, you can actually transfer the cash-back points from the Freedom to convert them into much more valuable (and transferable) Ultimate Rewards points. While the conversion is a manual process, it essentially means that you can earn 5 Ultimate Rewards points per dollar spent at a variety of merchants throughout the year.
Since the bonus categories are capped at $1,500 each quarter, here’s a comparison of how much you can earn if you max out purchases at these merchants each year:
- With an Ultimate Rewards card: $1,500 per quarter x 4 quarters x 5 points per dollar = 30,000 Ultimate Rewards points (worth $600 based on TPG’s most recent valuations)
- Without an Ultimate Rewards card: $1,500 per quarter x 4 quarters x 5% cash back = $300
As you can see, holding a card that earns Ultimate Rewards points more than doubles your return. The rewards never expire as long as your account is open and active, and the card carries no annual fee. The card has purchase protection and extended warranty protection, as well as a 3% foreign transaction fee.
Chase Freedom Unlimited
Welcome bonus: $150 back after you spend $500 on purchases in the first three months.
The Chase Freedom Unlimited offers a consistent 1.5% cash back on every purchase you make with no annual fee. The card offers purchase protection and extended warranty protection, but has a 3% foreign transaction fee. Like the regular Chase Freedom, the points you earn can also be converted into fully transferable Ultimate Rewards points if you also have a card like the Chase Sapphire Preferred Card. Here’s how that would translate to rewards if you spend $10,000 per year on the card:
- With an Ultimate Rewards card: $10,000 x 1.5 points per dollar = 15,000 Ultimate Rewards points (worth $300)
- Without an Ultimate Rewards card: $10,000 x 1.5% cash back = $150
Once again, by using the Freedom Unlimited with an Ultimate Rewards-accruing card, you’re more than doubling your return. This also doesn’t factor in the bonus points you can earn by shopping through the Ultimate Rewards shopping portal, making this a great addition to your wallet.
Welcome bonus: $150 after you spend $500 on purchases within the first three months
A great option for traveling outside the US is the Capital One Quicksilver Card, as it waives foreign transaction fees. The great thing about this card is the simplicity. You don’t need to worry about bonus categories or spending thresholds. It’s just a 1.5% return on all your spending with no annual fee. You also have the flexibility of getting your cash back as a statement credit or check, and you can do this on demand or on a specific schedule that you dictate. The card offers extended warranty protection as a benefit.
Discover it Cash Back
Another great cash-back option is the Discover it Cash Back. It (pun intended) doesn’t get a ton of press since it doesn’t have a maximization option like the Chase Freedom, but the card does offer a standard earning rate of 1% cash back on all purchases. Also, enroll every quarter to earn 5% cash back on up to $1,500 in purchases made in various categories throughout the year.
What makes this card especially appealing is the promotion for new card holders. During your first year of card membership, Discover will match cash back on all purchases. This bumps the standard earning rate to up to 2% and the bonus category earning rate to up to 10%, though they will fall back down to the regular 1% and 5% levels after your first 12 months. This is (essentially) a sign-up bonus, though exactly how rewarding it is depends entirely on how much you spend.
You also have a number of options for putting your hands on the rewards:
- Gift cards or instant eCertificates from partners — starting at $20
- Charitable donation to select charities — starting at a penny
- Credit to your account — starting at a penny
- Electronic deposit into any account you designate — starting at a penny
- Pay with cash-back bonus at select online retailers — starting at a penny
This card carries no annual fee and also imposes no foreign transaction fees on purchases made outside the US, making it a great option if you’re looking to keep earning cash-back when you travel abroad.
The Discover it® Miles card provides a modest 1.5 miles per dollar spent on all types of purchases. It’s marketed as a travel rewards credit card, but all types of redemptions — from travel statement credits to cash deposits into an account of your choice — are worth 1 cent per point. So, you’ll earn 1.5% cash back on all purchases.
Although the card doesn’t offer a sign-up bonus, it matches cash back on all purchases you make within your first year of card membership. This temporarily increases your standard earning rate to 3%, but it will fall back to 1.5% after your first 12 months.
The card has no annual fee and no foreign transaction fees on purchases made outside the US, so it’s a good choice for earning cash back on your everyday purchases while traveling abroad.
Welcome bonus: 50,000 bonus points (worth $500) after you make at least $3,000 in purchases in the first 90 days of account opening
The Bank of America Premium Rewards credit card offers 2x points on travel and dining purchases and 1.5x points on all other purchases. The card has a $95 annual fee, but no foreign transaction fees and it features benefits that are usually only found on higher annual fee cards: an annual $100 airline incidental statement credit for qualifying purchases, a credit for TSA PreCheck or Global Entry every four years and travel insurance protections to assist with trip delays, cancellations and interruptions, baggage delay inconvenience, lost luggage and emergency evacuation and transportation.
When your points balance is 2,500 points or more, you can redeem your points for cash rewards. Each point redeemed is worth 1 cent when redeemed for the following types of cash rewards:
- A statement credit
- An electronic deposit into a Bank of America checking or savings account
- A contribution to an eligible Cash Management Account with Merrill Lynch Wealth Management or Merrill Edge, or College 529 savings account held at Merrill Lynch
Bank of America Cash Rewards credit card
Welcome bonus: $150 cash rewards bonus after you make at least $500 in purchases in the first 90 days of account opening
The Bank of America Cash Rewards credit card offers 3% cash back in the category of your choice (gas, online shopping, dining, travel, drug stores or home improvement and furnishings) and 2% cash back at grocery stores and wholesale clubs on the first $2,500 in combined bonus category purchases each quarter. Subsequent purchases each quarter in these categories, as well as all other purchases, earn 1%. You can change your 3% category once a month and Preferred Rewards clients get a 25-75% rewards bonus on every purchase.
You can redeem cash rewards for a statement credit, check, deposit made directly into a Bank of America checking or savings account or a qualifying Cash Management Account or 529 account. Some redemption options have a $25 redemption minimum, but redemptions for an electronic deposit into a Bank of America checking or savings account, into a qualifying Cash Management Account or for a statement credit don’t have a minimum redemption amount.
Welcome bonus: $150 bonus after making $500 in eligible net purchases within the first 90 days of account opening
The U.S. Bank Cash+ Visa Signature Card offers 5% on your first $2,000 in combined eligible net purchases each quarter on two categories you choose from home utilities, ground transportation, select clothing stores, cellphone providers, electronics stores, car rentals, gyms/fitness centers, fast food, sporting goods stores, department stores, furniture stores and movie theaters. You’ll also earn 2% on one everyday category that you choose from gas stations, restaurants and grocery stores. You’ll have to select your 5% and 2% categories each quarter — if you don’t, you’ll only earn the 1% that you’ll earn on all other purchases. There’s no annual fee, which is pretty amazing considering you’ll earn 5% on some of your purchases.
Additional reporting by Katie Genter.
All credit card photos by Eric Helgas for The Points Guy
Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.
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