Many people prefer cash back rewards to other credit card perks such as frequent flyer miles. Cash rewards programs are simple to understand and easy to redeem. Unlike points and miles, cash can earn interest when unused and are not subject to the constantly changing terms and conditions of credit card issuers and travel programs. (See also: How Cash Rewards Credit Cards Really Work)
My family is a perfect example of how you can use credit cards to receive cash back. Using our cards for day-to-day purchases, we may spend as much as $2,500 on them each month. When we are not looking for travel rewards, we use a card that returns 2% on all purchases in order to earn an additional $50 a month in cash back. That equals a return of $600 each year that we can add to our discretionary spending or apply to our savings.
Just one word of caution — cash back credit cards should only be used by people who can pay their credit card balances in full and on time. To do otherwise virtually ensures that you will owe more in interest and penalties than you will ever receive as cash back.
The Top Credit Cards Featuring Cash Back Rewards
Once you have decided to earn credit card rewards in the form of cash back, you should definitely consider my favorite cash back rewards credit cards.
Bank of America® Cash Rewards credit card
The Bank of America® Cash Rewards credit card offers 2% back at grocery stores and wholesale clubs, 3% back in the category of your choice: gas, online shopping, dining, travel, drug stores, or home improvement /furnishings, and 1% on other purchases. (Grocery store, wholesale club, and choice category bonus rewards apply to the first $2,500 in combined purchases in these categories each quarter, then purchases receive 1% cash back.) There is no annual fee.
Bonus offer: $200 online cash rewards bonus after you spend at least $1,000 in purchases in the first 90 days of account opening.
Capital One® Savor® Cash Rewards Credit Card
The Capital One® Savor® Cash Rewards Credit Card offers unlimited 4% cash back on dining and entertainment, 2% on grocery store purchases, and 1% on all other purchases. There are no rotating categories or sign-ups required to earn cash rewards, and the cash back doesn’t expire for the life of the account. Plus, earn 8% cash back on tickets at Vivid Seats through May 2020. There is no foreign transaction fee for this card. The $95 annual fee is waived the first year.
Bonus offer: New cardholders can earn a one-time cash bonus of $300 after you spend $3000 on purchases within the first 3 months from account opening.
American Express Cash Magnet® Card
The American Express Cash Magnet® Card offers unlimited 1.5% cash back on your purchases. You receive your cash back in the form of Reward Dollars that you can redeem for statement credits, gift cards, and merchandise. There is no annual fee. See Rates & Fees.
Bonus offer: Earn a $150 statement credit after you spend $1,000 or more in purchases with your new card within the first 3 months of card membership. Terms apply.
For rates and fees of the American Express Cash Magnet® Card, please click here.
Citi® Double Cash Card – 18 month BT offer
The Citi® Double Cash Card – 18 month BT offer from our partner Citi stands out from other credit cards offering cash back rewards in that you earn cash back not once, but twice on every purchase. You can earn 1% cash back when you buy, plus another 1% cash back as you make payments for those purchases, for a total of 2% cash back. No need to wait until you pay off a purchase to earn the additional cash back — you’ll get it whether you can pay in full or over time, as long as you pay at least the minimum amount due. There are no category restrictions, no enrollments in rotating categories, and no limits on the amount of cash back that you earn. There is no annual fee.
Blue Cash Preferred® Card from American Express
The Blue Cash Preferred® Card from American Express offers the highest cash back you can get for groceries. Earn 6% cash back at U.S. supermarkets (up to $6,000 per year in purchases, 1% after that), as well as 6% on select U.S. streaming services. Earn 3% cash back on transit including taxis/rideshare, parking, tolls, and more. You also earn 3% at U.S. gas stations, and 1% cash back on other purchases. There is $95 annual fee for this card. See Rates & Fees.
Welcome offer: Earn a $250 statement credit after spending $1,000 in purchases within the first 3 months. Terms apply.
For rates and fees of the Blue Cash Preferred® Card from American Express, please click here.
TRIO® Credit Card from Fifth Third Bank
The TRIO® Credit Card from Fifth Third Bank awards 3% cash back rewards at restaurants and 2% cash back rewards on gas and at grocery stores and drug stores, up to a combined purchase total of $1,500 per quarter. You earn an unlimited 1% cash back on other purchases and purchases made after you reach the quarterly cap. New cardholders can earn a bonus of 10,000 bonus points, which can be redeemed for $100 cash back, after spending $1,000 with the card within 90 days of opening your account. There is no foreign transaction fee or annual fee.
While not as exciting as redeeming rewards for travel, the value in getting cold, hard cash is not to be underestimated. There’s no value in collecting travel rewards if you don’t end up using them. With cash rewards, you know you’ll always be able to use your points. Start collecting your cash rewards today!