When it comes to earning rewards from a credit card, you have plenty of options. Many bank rewards points can be redeemed for gift cards, merchandise or travel reservations while many others offer cards with travel rewards from airline and hotel partners. Still, many rewards credit card users prefer a cash-back option.
How to Choose the Right Cash-Back Credit Card
It may seem easy to choose the best cash-back card; just look for the card offering the highest rate of return for your spending. But in the highly competitive credit card industry, some card issuers offer high return rates within certain merchant categories in addition to a cash-back rate for all purchases. So the trick is to pick a credit card offering the best combination of returns for bonus categories and general spending.
Adding to the confusion is some cards will place limits on the amount of rewards you can earn in bonus categories. Meanwhile, many credit card users will overestimate the amount of money they spend in featured categories. For example, you may consider gasoline a major expense. But with gas prices as low as they’re been in over a decade, in addition to increased fuel efficiency, more drivers are spending less than $1,000 annually on gas. For some, a credit card offering 3% cash back on gasoline will only realize $30 a year in rewards. This makes it important for applicants to consider their actual spending on bonus categories when choosing a cash-back card.
Other Factors to Consider
Beyond the cash-back rewards, there are several other important aspects to cards such as these. For example, some of these cards offer generous sign-up bonuses that can dramatically increase your cash back earned during your first year as a cardmember. In addition, some of these cards feature 0% APR introductory financing on new purchases, balance transfers or both. It’s also important to consider other cardholder benefits as well as fees such as annual fees and foreign transaction fees.
And, of course, a cash rewards credit card isn’t for everyone. Though there are increasingly more options for those with fair or bad credit, the best rewards credit cards are only available to those with good or excellent credit. You can check two of your credit scores for free on Credit.com to see where you stand.
After ranking a number of cash-back credit cards on a variety of these factors, here are the three credit cards that topped our list of the best cash-back credit cards in America.
The Winner: Citi Double Cash
Citi® Double Cash Card – 18 month BT offer
- Earn cash back twice on every purchase with unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases.
- Balance Transfers do not earn cash back
- 0% Intro APR on Balance Transfers for 18 months. After that, the variable APR will be 14.49% - 24.49% based on your creditworthiness
- Click 'Apply Now' to see the applicable balance transfer fee and how making a balance transfer impacts interest on purchases.
- No categories to track, no caps on cash back, no annual fee*
Card Details +
Why It Won: This card rewards you twice — 1% back when you make a purchase and 1% back when you pay it off.
Other Features: This card offers 1% cash back on at the time of purchase and a second 1% of cashback after payment. There is no limit to the amount of cashback you can earn and you can redeem your rewards as a check, statement credit or as gift cards. (You can read a full review of the Citi Double Cash card here.) New cardholders also receive Intro: 0%* for 18 months on Balance Transfers*, with a 3% balance transfer fee. After that, the card has a variable APR of 14.49% - 24.49%* (Variable). The Citi Double Cash also features strong benefits such as trip cancellation/interruption protection, extended warranty coverage and a damage and theft purchase protection policy. (Full Disclosure: Citibank, as well as American Express & Chase, advertise on Credit.com, but that results in no preferential editorial treatment.)
The Cost: There is $0* annual fee for this card but there is a 3% foreign transaction fee. In addition, cardholders also receive their first late payment fee waived automatically.
1st Runner-Up: Chase Freedom
- Earn a $150 Bonus after you spend $500 on purchases in your first 3 months from account opening
- Earn 5% cash back on up to $1,500 in combined purchases in bonus categories each quarter you activate
- Enjoy new 5% categories each quarter like gas stations, restaurants and drugstores
- Unlimited 1% cash back on all other purchases – it’s automatic
- 0% Intro APR for 15 months from account opening on purchases and balance transfers, then a variable APR of 15.99-24.74%. Balance transfer fee is 5% of the amount transferred, $5 minimum
- No minimum to redeem for cash back
- Cash Back rewards do not expire as long as your account is open
- No annual fee
Card Details +
Why It Won: Strong rates of return and a generous sign-up bonus.
Other Features: New applicants receive a $150 sign-up bonus after spending $500 on new purchases within three months of opening an account. Make your first purchase and add an authorized user within the first three months, and you get another $25 bonus. Cardholders receive 5% cash back on up to $1,500 spent each quarter at merchants in featured categories in addition to 1% cash back on all other purchases. This card also offers new applicants 15 months of interest free-financing on both new purchases and balance transfers, with a 3% balance transfer fee. After the intro period, the card has a 15.99% to 24.74% variable APR. (You can read a full review of the Chase Freedom card here.)
The Cost: There is no annual fee for this card but there is a 3% foreign transaction fee.
2nd Runner-Up: Blue Cash Preferred from American Express.
Blue Cash Preferred® Card from American Express
- $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 13.99% to 24.99%.
- Expanding merchant acceptance: Over 1 million more places in the U.S. started accepting American Express® Cards in the last year.
- $95 annual fee.
- Cash back is received in the form of Reward Dollars that can be easily redeemed for statement credits, gift cards, and merchandise.
- Terms Apply.
Card Details +
Why It Won: This card offers impressive cash-back rates on bonus categories and a large sign-up bonus.
Other Features: New applicants receive up to $200 cash back after spending $1,000 on new purchases. This card offers 6% cash back on up to $6,000 spent each year at U.S. supermarkets (then 1%), 3% cash back at U.S. gas stations and at select U.S. department stores and 1% cash back on all other purchases. The card has a special intro offer APR of 0% for 12 months on purchases and balance transfers, then 13.99%-24.99% Variable APR. (You can read a full review of the American Express Blue Cash Preferred card here.)
The Cost: $95 annual fee. There is also a 2.7% foreign transaction fee.
At publishing time, the Blue Cash Preferred from American Express, Chase Freedom and Citi Double Cash cards are offered through Credit.com product pages, and Credit.com is compensated if our users apply and ultimately sign up for this card. However, this relationship does not result in any preferential editorial treatment.
Note: It’s important to remember that interest rates, fees and terms for credit cards, loans and other financial products frequently change. As a result, rates, fees and terms for credit cards, loans and other financial products cited in these articles may have changed since the date of publication. Please be sure to verify current rates, fees and terms with credit card issuers, banks or other financial institutions directly.
This article was last updated on September 21st, 2017