Rewards Made Easy: The Best Cash Back Credit Cards
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Every time you swipe a credit card, the merchant pays a fee in the neighborhood of 3%. Businesses that want to be profitable will factor those costs into the price of the products and services they offer.
If you assume you’re paying about a 3% premium on everything you purchase, you might as well do what you can to get most of that money back.
As someone who likes to optimize, I’ve often found ways to get more than 3% back on my money via a combination of welcome bonuses with new cards and efficient use of travel rewards points.
Always trying to squeeze the most out of every point can be challenging, time-consuming, frustrating, and even stressful. There are times where it’s just easier to use a good cash back card and know exactly what your return will be.
Today, I’ll review some of the best cards available for good old, simple cash back.
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If you want to jump right to the cash back cards based on category, use this handy table of contents.
Rewards Made Easy: The Best Cash Back Credit Cards
Personal Cards Offering Cash Back as a Flat Percentage
It doesn’t get any simpler than getting a flat percentage back on every dollar you spend. These cards are ideal for the person who wants to have one card to use on everything. It’s simplicity at it’s finest.
The Chase Freedom Unlimited card now offers 3% cash back on your first $20,000 charged to the card in your first year. After that, the card offers a flat 1.5% cash back on all purchases.
There is no annual fee, and the card also offers an introductory 0% APR for 15 months on purchases and balance transfers (with a 3% fee on balance transfers).
The HSBC Cash Rewards Mastercard offers 3% cash back on your first $10,000 charged to the card, and then a steady 1.5% cash back thereafter.
In addition, you’ll receive a 10% anniversary bonus on all cash rewards once a year, giving you an effective 1.65% cash back (and 3.3% back on the first $10,000 in year one).
There is no annual fee, and this card also has the benefit of charging no foreign transaction fees.
The Capital One Quicksilver Cash Rewards Card will also get you 1.5% back on all purchases. Like the others above, there is no annual fee, and like the HSBC card, there are no foreign transaction fees when using this card outside of the United States.
The card also has a 0% introductory APR for 15 months on purchases and balance transfers (with a 3% fee on balance transfers).
The US Bank Cash 365 American Express card gives you a flat 1.5% cash back on all purchases. In addition, you can earn a $150 welcome bonus after spending just $500 on the card in the first 90 days.
The card also offers a 0% introductory offer on balance transfers for the first 12 billing cycles (a 3% fee applies).
The Wells Fargo Cash Wise Visa Card gives you 1.5 % back on all purchases with no annual fee. Like several of the other cards, there is a 0% introductory APR on balance transfers (fees apply) and purchases for the first 12 months.
The card offers a $200 welcome bonus with a minimum spending requirement of $1,000 in the first three months.
Additional perks include 1.8% cash back on mobile wallet purchases using Apple Pay and Google Pay.
If you pay for your monthly cell phone with the card, you’ll get up to $600 in damage and theft protection on the phone (with a $25 deductible). That’s a pretty sweet perk if you have a valuable phone and a case of the dropsies.
The card carries no annual fee and a 0% introductory APR on balance transfers for 18 months (fees apply).
I’m not able to link directly to this card, but you’ll find it among the others when comparing cash back cards on my CardRatings partner page.
The Fidelity Rewards Visa Signature Card always gives you 2% cash back into an eligible Fidelity account including a brokerage account, IRA, or HSA.
That’s a great way to pay yourself first with the credit card rewards. You can have the cash back automatically invested in a simple, three fund portfolio. You can also spend it, but why not invest it once the money’s sitting right there with Fidelity?
The card has no annual fee and you will earn a $100 bonus when spending $1,000 on the card in the first 90 days.
Business Cards Offering Cash Back as a Flat Percentage
The Chase Ink Business Unlimited card gives you unlimited 1.5% cash back on all purchases. The card has no annual fee.
The welcome bonus is quite generous for a no-annual-fee card at $500 after a $3,000 spend within the first three months.
The Capital One Spark Cash for Business card gives you 2% flat cash back on all purchases.
In addition, there’s a $500 welcome bonus for new cardholders who spend $4,500 in purchases in the first three months. The annual fee of $95 is waived the first year.
If you prefer a card with no annual fee, the Capital One Spark Cash Select for Business card is just that. The downside is that you get 1.5% cash back instead of the 2% you earn with the non-Select version of the card.
This card also has a smaller welcome bonus of $200 after a $3,000 spend in the first three months.
How do you determine which card is best?
The break-even point is at about $20,000 in annual spending on the card.
1.5% cash back would be $300.
2% back would be $400.
It makes sense to pay a $95 annual fee to get an extra $100 in cash back, not to mention the larger welcome bonus.
If you spend less than $20,000 on a business card, the Cash Select card may make more sense for you, although the Chase Ink Business Unlimited card has the same cash back percentage, also has no annual fee, and a welcome bonus of $500 rather than $200.
Personal Cards Offering Variable Cash Back in Different Categories
The cards above are the simplest for earning cash back rewards. It doesn’t matter what you spend your money on; the cash back is the same.
The following cards take a little more effort to optimize. Many will offer 1% cash back in certain categories and 2% to 6% cash back in others. Those categories are static in some cards, rotate quarterly in others, and some cards let you choose the categories for increased cash back.
Let’s look at some of the top cards in this category.
The Chase Freedom card offers up to 5% cash back on categories that change every three months. These are popular spending categories like gas stations, grocery stores, wholesale clubs (like Sam’s and Costco), etc… You’ll get 1% cash back on purchases outside of the rotating categories.
The card has no annual fee and has an introductory 0% APR offer identical to its sister card, the Chase Freedom Unlimited.
This card does offer a welcome bonus of $150 when just $500 is charged to the card in the first three months.
The Capital One Savor Cash Rewards Credit Card is great for those who believe in deriving happiness from spending money on experiences rather than things.
The card offers 4% cash back on dining and entertainment. Grocery store spending earns you 2% back, and you get 1% cash back on everything else. Until May of 2020, purchasing tickets via Vivid Seats results in 8% cash back.
The welcome bonus on this card is rich at $500 after spending $3,000 in the initial three months. There is a $95 annual fee, which is waived in your first year as a cardholder.
The Blue Cash Preferred Card from American Express is great for those of you who spend more on groceries than dining out. Count me among them.
You get a full 6% back at U.S. supermarkets on the first $6,000 in annual grocery store purchases and many popular streaming services.
Gas station purchases and other ground transit will net you 3% in cash back, and all other purchases give you 1% back.
The card does have a $95 annual fee and a $250 welcome bonus when you spend $1,000 in the first three months after opening your account.
The Blue Cash Everday Card from American Express is the no annual fee version of the AmEx Blue card.
The perks are lower, but you will get 3% back on supermarket purchases (with the same $6,000 limit), 2% back at gas stations, and 1% elsewhere.
The welcome bonus is 25% lower at $150 after meeting a minimum spend of $1,000 in the first three months.
The U.S. Bank Cash+ Visa Signature Card is a card that lets you choose the categories in which you get the most cash back.
You’ll get 5% cash back on $2,000 in eligible purchases each quarter on the combined spending in two categories of your choice. That’s $100 per quarter right there.
In addition, you can choose an everyday category (grocery stores, gas stations) in which you’ll earn 2% cash back, and you’ll get 1% back on everything else.
This card has no annual fee, and the welcome bonus gives you $150 after spending a measly $500 in the first three months.
The Wells Fargo Propel American Express Card offers 3% cash back in an impressive number of spending categories, particularly when you consider it’s a no annual fee card.
Technically, you earn Go Far Rewards points, but 1 point is a 1 penny equivalent. You earn triple points for dining, gas stations, ride sharing, transit services, and travel (flights, hotels, and car rental).
There is an introductory 0% APR offer for 12 months on new purchases and balance transfers (fees apply).
The welcome bonus is also quite generous for a card with no annual fee with 30,000 points ($300 worth) granted after spending $3,000 on the card in the first three months.
The Costco Anywhere Visa Card by Citi is for Costco members exclusively. Again, I am among them, although I haven’t yet picked up this particular card.
There is no welcome bonus and no annual fee with your paid Costco membership.
The cash back perks are pretty sweet with 4% back on the first $7,000 in gasoline. If you’re spending more than that, you should drive less or get a more fuel-efficient vehicle.
Restaurants and eligible travel purchases will get you 3% cash back, you’ll receive 2% cash back on Costco purchases, and 1% back on everything else.
Business Cards Offering Variable Cash Back in Different Categories
The Chase Ink Business Cash card is, in my opinion, the best business credit card with variable cash back.
The card has no annual fee ever, a $500 welcome bonus with a $3,000 spend in three months, and offers up to 5% cash back.
You’ll earn 5% on the first $25,000 spent (that’s $1,250 cash back) on purchases at office supply stores (Staples, Office Depot, Office Max), cellular and landline telephone service, internet, and cable TV services.
Gas station purchases are rewarded with 2% cash back and you’ll get 1% back on everything else.
The SimplyCash Plus Business Credit Card from American Express is another option for small business owners who want a variable cash back card.
Like the Chase Ink Business Cash card, it has no annual fee and you can earn up to 5% cash back at office supply stores and U.S. cell phone service. This perk goes up to $50,000 spent in these two categories annually.
You can choose to earn 3% back on one of eight other categories, and all other purchases will net you 1% cash back.
There is, however, no welcome bonus with this card.
Cards with Points That Can Be Converted to Cash
For the most part, the cards above offer cash or cash equivalents as your only reward option. There are lots of other great cards that work on a point system, and those points can often be converted to cash or cash equivalents, often on a 1 point = 1 penny conversion factor.
In many cases, cash is not the best redemption option for these points, and it’s not unusual for people to get 1.5 to 2 cents or more in value per point when redeemed for travel or other perks.
There are too many cards to go into the same level of detail as we have with the other cards, but some of the top cards that fit this category are worth mentioning, and you can follow the links for all you’ll need to know.
Personal Credit Cards with Flexible Points
- Chase Sapphire Preferred
- Chase Sapphire Reserve
- Capital One Venture Rewards (learn more about this card)
- American Express Gold Card (learn more about this card)
- American Express Platinum Card (learn more about this card)
Business Credit Cards with Flexible Points
- Chase Ink Business Preferred
- Blue Business Plus Card from American Express (learn more about this card)
- American Express Business Gold Card (learn more about this card)
- AmEx Business Platinum (learn more about this card)
Developing Your Cash Back Strategy
One Card Strategies:
If simplicity is your thing, I recommend getting a single card with a flat percentage of at least 1.5% back and using it for everything you buy. If you put $50,000 on a card in a year, that will net you $750 back annually, and you may get a welcome bonus on top of that.
The Chase Freedom Unlimited Card will give you 3% back on the first $20,000 — that’s $600, and you’d get another $450 back on the next $30,000 in spending for a total of $1,050 back on $50,000 in credit card spending your first year.
The Fidelity Rewards Visa Signature Card will net you 2% back, or $1,000 on a $50,000 annual spend. In the first year, you can earn the $100 welcome bonus for a total of $1,100 in cash back to invest (or spend).
If you’ve got a small business and plan to spend $50,000 in a year (with half of that coming in eligible categories), the Chase Ink Business Cash card could net you $1,250 on the 5% cash back category, and at least another $250 (more if you spend at gas stations).
Add on the $500 welcome bonus for meeting the minimum spend of $3,000 in three months and you could earn at least $2,000 cash back in your first year.
Two Card Strategies:
If you’re willing to use two or more cards to optimize your cash back, consider getting additional cards. Choose from cards that always give a higher return on certain categories and those that give more cash back in rotating categories. A label maker can come in handy to update the categories offering increased cash back four times a year.
It makes sense to pair one of the cards above (or your favorite flat rate cash back card) with a variable cash back card.
The Chase Freedom card with it’s rotating 5% cash back categories is a staple in my wallet.
The Capital One Savor card (compare this card) with its 4% on dining and entertainment is appetizing.
Earning 6% back on groceries is pretty great, and the Blue Cash Preferred card from American Express (learn more about this card) offers that perk (on up to $6,000 in supermarket purchases annually).
Small business owners pursuing a two-card strategy could pair the Chase Ink Business Cash card (variable cash back) with the Chase Ink Business Unlimited (flat rate cash back) or Chase Ink Business Preferred (valuable Chase Ultimate Reward points)
Three Card Strategies:
The point of this article is finding a card or two that can give you simple cash back for those who don’t want to fuss too much with credit card rewards. Adding a third card to your armamentarium may be counter to our goals here.
Nevertheless, it may be as simple as adding a business card to a two-card personal credit card strategy or vice versa.
If we’re looking solely at personal cards, you’ll want to add a card that gives you increased cash back in one or more categories that the other cards don’t.
Adding a card like the U.S. Bank Cash+ Visa Signature Card would make sense because you get to choose which categories get you 5% cash back each quarter (on up to $2,000 in spending).
With its 3% back on a variety of categories including dining, gas, and travel, the Wells Fargo Propel American Express card (learn more about this card) could be another nice addition, especially if your second card does not have increased cash back in any of those categories.
A pretty sweet three-card strategy could look like this:
- 6% back on up to $6,000 in groceries with the Blue Cash Preferred (compare card).
- 4% back on dining and entertainment with the Capital One Savor Card (compare card).
- 3% back on gas with the Blue Cash Preferred.
- 2% back on everything else with the Fidelity Rewards Visa Signature Card.
The welcome offers after meeting minimum spending requirements in the first year for these three cards add up to $800.
Two of those three cards have an annual fee after the first year. If you’d like a no-annual fee setup with three cards, it could look like this:
- 5% back on rotating categories that change quarterly with the Chase Freedom card.
- 3% back on gas, travel, dining, ride sharing, and transit with the Wells Fargo Propel American Express Card (compare card).
- 1.5% back on everything else with the Chase Freedom Unlimited Card.
The welcome offers after meeting minimum spending requirements in the first year for these three cards add up to $750 (counting the Chase Freedom bonus as $300 if you spend the full $20,000 on it that first year).
Four Card Strategies:
Did you not read what I said about simplicity?!?
If you’re looking to carry four or more cards, it’s time to look beyond cash back cards to cards that offer travel rewards and other perks. You can find them here:
- Credit Cards for People Who Love Free Travel and Money
- The Best Business Credit Cards for Your Small Business
Chase 5 / 24
As you devise your cash back strategy, keep in mind the fact that Chase usually will not issue a new card to someone who has opened 5 new credit card accounts in the last 24 months (the 5 / 24 Rule).
Business cards from Chase, American Express and Citi Bank do not count, but most other business cards and personal cards do.
Note that while new Chase business cards may not count against your total, they typically will only approve you for a Chase business card if you have had fewer than five new accounts in the last two years.
Given this limitation, if there’s a chance you’ll apply for more than five cards in the next two years, I recommend starting with Chase cards.
It’s also a good idea to pick up no more than two or maybe three personal cards in a year. I also have a preference for certain business cards that will not count against your total.
Also, keep in mind that other banks will look at your total new accounts and you can be denied no matter how good your credit is. It’s not just Chase, but their limitations seem to be the most well-known and best-defined.
Other recommendations for managing multiple credit cards include:
- Always autopay.
- No companion cards.
- Don’t carry a dozen cards.
- Always pay your balance in full.
- Don’t stress. Perfection is not required.
For rationale and more details, please read the tips section in my master post, Credit Cards for People Who Love Free Travel and Money.
Earn that Cash Back!
We’ve covered a lot of ground today. To jump back to the different categories of cash back cards, use these handy buttons.
Do you prefer cash back credit cards? Share your strategies and tips with your fellow readers below!
Physician on FIRE has partnered with CardRatings for our coverage of credit card products. Physician on FIRE and CardRatings may receive a commission from card issuers.