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Update: Some offers mentioned below are no longer available. View the current offers here – Bank of America Cash Rewards credit card
The Chase Sapphire Reserve (CSR) and The Platinum Card® from American Express can be points-generating miracle workers, but they still have blind spots when it comes to spending that doesn’t earn you bonus rewards. If you’re focused exclusively on gathering as many points and miles as possible, you, too, may have a blind spot.
Plunk down your CSR to buy a tank of gas and you’ll earn just 1 point per dollar spent. Those points are worth a healthy 2.1 cents apiece, according to TPG’s latest valuation. But you’re still missing an opportunity to grab a higher return by using another credit card that offers top rewards at the pump.
This is true not only at gas stations, but also at grocers, office supply stores and on Amazon.com — merchants not often included in the list of bonus categories for the top travel rewards credit cards. Spending at these types of businesses, however, does tend to fall within the bonus categories of cash-back cards.
Consider sacrificing some points to boost your overall rewards haul by using one of these cash-back credit cards to supplement your travel rewards game.
The Blue Cash Preferred® Card from American Express offers the most generous bonus on US supermarket purchases, although it was a significantly more valuable card before it capped the then unlimited bonus return in 2012. It’s still worth having in your wallet even if you spend more than $6,000 annual at the grocer.
Grocery rewards: 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
Spend $6,000 annually at the supermarket and you’ll earn a total of in $360 statement credits. If you instead use your Chase Ultimate Rewards credit card, you’ll earn 6,000 points, worth $126 in travel.
Blue Cash Preferred has a healthy 3% cash-back return on US gas station purchases, but you can grab an even better return with the Costco Anywhere Visa Card by Citi. Redeeming your rewards is this card’s major downside, as you can’t collect whenever you want. You’ll get a coupon annually in your February billing statement reflecting how much cash back you’ve accumulated, and you’ll be able to redeem it through December 31 by visiting a Costco warehouse and exchanging the coupon for merchandise or cash.
Gas rewards: Earn 4% cash back on eligible gas worldwide (on up to $7,000 a year in purchases, then 1%)
Other rewards: Earn 3% cash back on restaurant and eligible travel purchases worldwide, 2% cash back rewards on all other purchases from Costco and1% cash back on all other purchases.
Welcome bonus: None
Annual fee: None, although you must be a Costco member to qualify for this card.
Spend $7,000 annually on gas, and you’ll earn $280 cash back. If you instead use The Platinum Card from American Express, you’ll earn 7,000 Membership Rewards points, worth $133 (1.9 cents apiece), according to TPG valuations.
If you’re not a Costco member — or you can’t stomach the once-a-year redemption requirement — another option to consider is the Bank of America Cash Rewards credit card, which pays 3% on gas and 2% at grocery stores and wholesale clubs for the first $2,500 in combined grocery/wholesale club/gas purchases each quarter.
The Amazon Prime Rewards Visa Signature Card is technically free to own, but you have to be an Amazon Prime subscriber to qualify. Amazon just announced it’s boosting the price of Prime membership from $99 a year to $119.
Amazon.com rewards: Earn 5% cash back on all Amazon purchases.
Other rewards: Earn 5% cash back at Whole Foods Market, 2% back at restaurants, gas stations and drugstores and 1% back on all other purchases.
Welcome bonus: New cardmembers receive a $70 Amazon.com gift card instantly upon approval.
Annual fee: None, although you must maintain your Amazon Prime membership.
If you don’t want to pay for the Prime membership, you could opt for the Amazon Rewards Visa Signature Card, which pays 3% cash back on Amazon purchases. There is no annual fee.
Spend $1,300 a year annually on Amazon purchases (that’s about how much the typical Amazon Prime member spends, according to a Consumer Intelligence Research Partners study) and you’ll earn $65 cash back on the Prime Rewards Visa. You’ll get nearly $38 more in value than if you used your Ultimate Rewards credit card to make those same Amazon purchases.
If you own a business or even occasionally earn a few bucks selling items on eBay, you can most likely qualify for a small business credit card. You won’t find any personal cards that include office supply stores in a bonus category, but several business credit cards do. One solid cash-back option: the Ink Business Cash Credit Card. Not only does it earn cash back, but you can also convert that cash into points if you own the Chase Sapphire Reserve, the Chase Sapphire Preferred Card or the Ink Business Preferred Credit Card.
Office supply rewards: Earn 5% cash back on the first $25,000 spent in combined purchases at office supply stores and on internet, cable and phone services each account anniversary year (then 1%).
Other rewards: Earn 2% cash back on the first $25,000 spent in combined purchases at gas stations and restaurants each account anniversary year (then 1%) and 1% cash back on all other purchases.
Welcome bonus: $500 cash back after you spend $3,000 in the first three months after account opening.
Annual fee: None
Utilizing the transfer option means you could effectively earn a return of 10.5% percent (based on TPG’s valuations). Even if you don’t have an Ultimate Rewards card, the 5% cash back is a pretty stellar return.
For non-bonus categories, you should also consider a cash-back card — but only if you can earn more than you would in points. One great option to consider: Chase Freedom Unlimited. Like with the Ink Business Cash, Freedom Unlimited rewards can be redeemed for points when transferred to an Ultimate Rewards account.
Rewards: Earn 1.5% cash back on all purchases.
Welcome bonus: $150 cash back after you spend $500 in the first three months after account opening.
Annual fee: None
Cash-back rewards can be converted into 1.5 Ultimate Rewards points per dollar for a 3.15% return based on TPG valuations. For non-bonus spending, there’s not many better options.
The most lucrative option isn’t always turning to a points-based rewards card. Sometimes cash back is king. Yes, you’ll sacrifice some points to earn those higher cash-back rewards, but you may even be able to find card options that will allow you to transfer your cash back into a points program. If your main goal is getting the most value possible on your credit card spending, consider using a cash-back card when it outperforms points or miles counterparts.
- 0% Intro APR for 15 months from account opening on purchases and balance transfers, then a variable APR of 16.99-25.74%. Balance transfer fee is 3% of the amount transferred, $5 minimum
- Unlimited 1.5% cash back on every purchase - it's automatic
- Earn a $150 Bonus after you spend $500 on purchases in your first 3 months from account opening
- No minimum to redeem for cash back
- Cash Back rewards do not expire as long as your account is open
- Free credit score, updated weekly with Credit Journey℠
- No annual fee