Find the Best Cashback Credit Card for Your Needs

If you’re looking to earn some extra cash on your everyday purchases, a cashback credit card might be the right choice for you. These types of credit cards offer a percentage of cash back on every purchase made with the card. The amount of cashback can vary, but it’s typically between 1% and 5%.

But with so many cash-back credit cards on the market, it can be tough to choose the right one. Here, we’ve compared some of the top cashback credit cards to help you make an informed decision.

Card #1: Discover it Cash Back

• 5% cash back on rotating categories (up to $1,500 in purchases per quarter, then 1%).
• 1% cash back on all other purchases.
• No annual fee.
• No foreign transaction fees.

Drawbacks: The rotating categories can be confusing, and you’ll need to opt-in each quarter to take advantage of them. Additionally, the 1% cash back on all other purchases is lower than some other cards on this list.

Card #2: Citi Double Cash

• 1% cash back on all purchases.
• 1% cash back when you pay off those purchases.
• No annual fee.
• No foreign transaction fees.

Drawbacks: The cashback rate of 2% is lower than some other cards on this list. There are also no bonus categories to earn extra cashback on certain types of purchases.

Card #3: Chase Freedom Unlimited

• 1.5% cash back on all purchases.
• $150 sign-up bonus after spending $500 in the first three months.
• No annual fee.
• 0% introductory APR for the first 15 months.

Drawbacks: The 1.5% cashback rate is lower than some other cards on this list. There are also no bonus categories to earn extra cashback on certain types of purchases.

Card #4: American Express Blue Cash Preferred

• 6% cash back on U.S. supermarket purchases (up to $6,000 per year, then 1%).
• 3% cash back on U.S. gas station and select department store purchases.
• 1% cash back on all other purchases.
• $250 sign-up bonus after spending $1,000 in the first three months.
• $95 annual fee.

Drawbacks: The annual fee can be a drawback for some users. Additionally, the 1% cashback rate on all other purchases is lower than some other cards on this list.

Factors to consider when choosing a cashback credit card

Annual fee

Some cashback credit cards come with an annual fee, while others don’t. If you’re someone who doesn’t spend a lot on your credit card, a card with an annual fee might not be worth it. On the other hand, if you’re a big spender and will be able to take advantage of the higher cashback rates and bonus categories offered by a card with an annual fee, it could be a good choice for you.

Rewards rate

The rewards rate, or the percentage of cash back you’ll earn on your purchases, is an important factor to consider when choosing a cashback credit card. Some cards offer a flat rate of cash back on all purchases, while others offer higher rates on certain types of purchases or in specific categories. Consider your spending habits and choose a card with a rewards rate that aligns with your needs.

Redemption options

Different cashback credit cards offer different redemption options. Some allow you to redeem your cash back as a statement credit or direct deposit into your bank account, while others offer gift cards or merchandise. Consider which redemption option works best for you, and choose a card that offers it.

Bonus categories

Some cashback credit cards offer higher cashback rates on certain types of purchases, such as groceries or gas. If you spend a lot in these categories, a card with bonus categories could be a good choice for you. Just be sure to pay attention to any spending caps or time limits on these categories.

Credit score requirements

Different cashback credit cards have different credit score requirements. If you have a lower credit score, you might have to choose a card with less favorable terms, such as a higher interest rate or annual fee. It’s important to check your credit score before applying for a credit card to make sure you’re eligible for the best offers.

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Tips for maximizing cash back rewards

• Use your cashback credit card for all eligible purchases. The more you use the card, the more cash back you’ll earn.
• Take advantage of bonus categories. If a card offers higher cashback rates on certain types of purchases, make sure to use the card for those purchases.
• Pay off the balance in full each month. Credit card interest can eat into your cashback earnings, so make sure to pay off your balance in full each month to maximize your rewards.
• Use the card for recurring expenses. If you have regular monthly expenses, such as a gym membership or streaming service subscription, consider using your cashback credit card to pay for them.
• Redeem your rewards for maximum value. Some redemption options, such as statement credits or direct deposits, offer more value than others. Consider which option will give you the most bang for your buck.

Conclusion

Cashback credit cards can be a great way to earn extra money on your everyday purchases. While all of the cards on our list have their pros and cons, the best one for you will depend on your individual needs and spending habits. Be sure to consider factors such as the annual fee, rewards rate, redemption options, bonus categories, and credit score requirements when choosing a cashback credit card.

It’s also important to remember to use your cashback credit card responsibly. Only use it for purchases that you can pay off in full each month, and be sure to pay your bills on time to avoid damaging your credit score. By following these tips, you can maximize your cashback rewards and make the most of your credit card.

If you’re still unsure about which cashback credit card is right for you, consider consulting with a financial advisor or checking out resources such as the Federal Trade Commission’s Consumer Information website for more information. With a little research and careful planning, you can find the perfect cashback credit card for your needs.

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