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Most credit card programs have a bonus rewards gap. You may have a great card for earning travel rewards that’s weak when it comes to spending on groceries. Or that awesome restaurant rewards card may offer meek returns when you fill up at the pump.

When it comes to DIYers and weekend home renovation warriors, though, pretty much everyone is out of luck. There just aren’t many good options for earning top rewards when spending money at your local hardware store or at one of the big-box firms. You could earn the 1x points that most cards would offer or even go for something like the Chase Freedom Unlimited, which will score you 1.5% back (or better when paired with an Ultimate Rewards card). There is a better option, though: Buy gift cards to your favorite hardware store from another type of store where you can earn top rewards

We’re thinking specifically about grocery store, gas stations and office supply stores for this post. You can earn a return of up to 8.55% on your plumbing, lumber or gardening expenditures by going this route. Here’s a thumbnail look at seven cards that return great value on gift card purchases.

Card Earning Rate Points Value (Based on TPG Valuations) Value per Dollar Spent
The Amex EveryDay® Preferred Credit Card from American Express 3x points up to $6,000 per year at US supermarkets, plus a 50% bonus when you use the card 30 times a month 1.9 cents each 8.55 cents
Blue Cash Preferred® Card from American Express 6% cash back up to $6,000 per year at US supermarkets; then 1% N/A (cash back) 6 cents
The Business Gold Rewards Card from American Express OPEN 3x points on gas station purchases 1.9 cents 5.7 cents
Citi ThankYou Premier Card 3x points on gas station purchases 1.7 cents 5.1 cents
Ink Business Cash Credit Card 5% cash back at office supply stores on up to $25,000 in combined spending within other bonus categories 1 to 2.1 cents 5 to 10.5 cents
SimplyCash® Plus Business Credit Card from American Express 5% cash back at US office supply stores on up to $50,000 in combined spending within other bonus categories; then 1% thereafter N/A (cash back)  5 cents

As you can see, it’s not difficult to earn a return of 5% or more on gift card purchases. Let’s look more in depth at each of these cards.

The Amex EveryDay Preferred Credit Card

Where you’ll earn top rewards on gift cards: Earn 3x points at US supermarkets, on up to $6,000 per year in purchases (then 1x).

Other rewards: 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

Keep in mind: According to TPG’s latest valuations, Membership Rewards points are worth 1.9 cents apiece. That means for every dollar spent at a grocer on gift cards, you’ll earn 3 points worth 5.7 cents. Then if you hit 30 monthly transactions, those 3 points per dollar spent turn into 4.5 points per dollar spent worth 8.55 cents apiece, making this the most valuable card available for hardware store gift card purchases

Blue Cash Preferred Card from American Express

Where you’ll earn top rewards on gift cards: Earn 6% cash back at US supermarkets (on up to $6,000 per year in purchases, then 1%).

Other rewards: Earn 3% cash back at US gas stations and at select US department stores 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

Keep in mind: Like with the EveryDay Preferred card, there’s an annual cap on how much you can spend at US supermarkets and still earn the bonus rewards. If you use either of these cards for your grocery spending, keep that cap in mind when purchasing gift cards for use at other stores.

The Business Gold Rewards Card from American Express OPEN

Where you’ll earn top rewards on gift cards: Earn 3x Membership Rewards points on one of five categories, which you get to select, including US purchases at gas stations.

Other rewards: Earn 2x on the remaining four categories, with a limit of $100,000 in purchases each year in each of the five categories. The remaining categories are: airfare purchased directly from airlines, US purchases for advertising in select media, US purchases for shipping and US computer hardware, software, and cloud computing made directly from select providers. All other purchases earn 1x rewards.

Welcome bonus: Earn 50,000 points after spending $5,000 in the first three months.

Annual fee: $175 (waived the first year)

Keep in mind: It might not make sense to choose US gas stations as the category to earn the most bonus points if you have more pressing business spending needs, especially if you’re choosing gas stations only to earn a better return on gift card purchases.

Citi ThankYou Premier Card

Photo by Eric Helgas for The Points Guy
Photo by Eric Helgas for The Points Guy

Where you’ll earn top rewards on gift cards: Earn 3x points at gas stations.

Other rewards: Earn 3x points on travel, 2x points on dining out and entertainment and 1x points on all other purchases.

Welcome bonus: Earn 60,000 ThankYou Points after you spend $4,000 in purchases within the first three months of account opening.

Annual fee: $95, waived the first year.

Keep in mind: Don’t try to purchase gift cards at gas stations associated with warehouse clubs, discount stores, department stores and convenience stores, as they won’t qualify for 3x points.

Ink Business Cash Credit Card

Where you’ll earn top rewards on gift cards: Earn 5% cash back at office supply stores on up to $25,000 in combined spending within other bonus categories.

Other rewards: Earn 5% cash back on cellular phone, landline, internet and cable TV services on up to $25,000 in combined spending including office supply stores, 2% back on the first $25,000 spent in combined purchases at gas stations and restaurants each calendar year and 1% cash back on everything else.

Welcome bonus: Earn $500 cash back after you spend $3,000 within the first three months.

Annual fee: None

Keep in mind: To grab the full redemption value, you’ll also need to own one of Chase’s credit cards that earns Ultimate Rewards (you’ll then transfer your cash back to those accounts and convert them to points), including the Ink Business Preferred Credit Card, Chase Sapphire Reserve or the Chase Sapphire Preferred Card. You need to show you either own a business or sell goods or services on the side in order to qualify for this credit card.

SimplyCash Plus Business Credit Card from American Express

Where you’ll earn top rewards on gift cards: Earn 5% back on purchases from US office supply stores,

Other rewards: Earn 5% back on wireless telephone services purchased directly from US service providers, 3% back on a category of your choice from a list of eight (options include airfare purchased directly from airlines, hotel rooms purchased directly from hotels, car rental purchased from select car rental companies, US gas stations, US restaurants, US purchases for shipping, computer hardware and software and for advertising on select media). The 5% and 3% bonuses are capped at $50,000 per calendar year (then 1%), and you’ll earn 1% on everything else.

Welcome bonus: None

Keep in mind: This card is not part of Amex’s Membership Rewards programs, so there’s no way to enhance the redemption value. If you’re buying gift cards from Staples, however, note that 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.”

Bottom Line

It’s fairly easy to earn a 2% or higher return on hardware store spending if you use your Chase Sapphire Preferred Card or something like Citi Double Cash. That’s the easiest route to go, and that may be completely worth it to you if you don’t have much around-the-house tinkering to do. But for people who spend thousands of dollar or more at the hardware store annually — and for small business contractors especially — going the gift card route could be a great way to save some cash, even if it gets you some odd stares at checkout.

Featured photo by Barn Images on Unsplash

Blue Cash Preferred® Card from American Express

 

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More Things to Know
  • $200 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%) - that means spending $60 a week at U.S. supermarkets could earn over $180 back per year.
  • 3% cash back at U.S. gas stations and at select U.S. department stores, 1% back on other purchases.
  • Low intro APR: 0% for 12 months on purchases and balance transfers, then a variable rate, currently 14.74% to 25.74%.
  • Over 1.5 million more places in the U.S. started accepting American Express® Cards in 2017.
  • Cash back is received in the form of Reward Dollars that can be easily redeemed for statement credits, gift cards, and merchandise.
  • $95 annual fee.
  • Terms Apply.
  • See Rates & Fees
Intro APR on Purchases
0% on Purchases for 12 months
Regular APR
14.74%-25.74% Variable
Annual Fee
$95
Balance Transfer Fee
Either $5 or 3% of the amount of each transfer, whichever is greater.
Recommended Credit
Excellent, Good
Terms and restrictions apply. See rates & fees.

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