Best Cash Back Credit Card?

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Nathan Drake
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Best Cash Back Credit Card?

Post by Nathan Drake »

Read about some credit cards on here that were offering incentives like $300 for signing up and spending over $500 in the first three months, are these still active?

Currently have 1 credit card that came with my checking/savings account with my bank, and it offers a flat 1% cash back on everything. I'm looking at adding a second credit card with more cash back for certain items (most of my expenses are groceries and gas).

Which ones should I look for, and are there any drawbacks of having multiple credit cards?
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LadyGeek
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Re: Best Cash Back Credit Card?

Post by LadyGeek »

The wiki has some good background info: Credit Cards

Search the forum for credit card - Google Search - it's a popular topic.
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Rockies1978
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Re: Best Cash Back Credit Card?

Post by Rockies1978 »

I have an American Express Blue Cash Rewards card that returns 6% back on groceries, 3% back on gas, and 1% back on everything else. It does have a $75 annual fee but you can crunch the numbers with how much you spend on groceries and gas to determine if it's worth it. Plus I like American Express customer service.

I use that in conjunction with a BOA 3%/2%/1% card which I typically only use at places that don't take AmEx. I'm not sure if it's the most optimal CC combo, but it has worked decent so far.
The Dark Knight
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Re: Best Cash Back Credit Card?

Post by The Dark Knight »

Ladygeek provided good background info.

I don't know about sign-up bonuses and such, but if you do your research you should get the answers to that fairly quickly.

I can share the cards I use to max my cash back:

(1) Blue Cash Preferred : I think that's what it's called. Basically I get 6% groceries, 3% department store, 3% gas. There's an annual fee, but I think I calculated that I get more from this card than the lower tiered no-fee version if I spend more than $2500/yr on groceries (I do).

(2) Fidelity Amex: 2% on everything

(3) Chase Freedom/ Discover: 5% on revolving categories that change every 3 months. For example, I believe right now it's gas.

With these cards, I think I cover nearly all of my spending at greater than the usual 1% you'd get. Some folks also get the Penfed card that gets 5% on gas. I personally don't use that one cause I don't drive a lot, plus I'm happy with the 3% I get from Amex and the occasional 5% from the rotating cards, so don't feel need to add another cards.
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Nathan Drake
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Re: Best Cash Back Credit Card?

Post by Nathan Drake »

LadyGeek wrote:The wiki has some good background info: Credit Cards

Search the forum for credit card - Google Search - it's a popular topic.
I'll check those out, I appreciate it.
Rockies1978 wrote:I have an American Express Blue Cash Rewards card that returns 6% back on groceries, 3% back on gas, and 1% back on everything else. It does have a $75 annual fee but you can crunch the numbers with how much you spend on groceries and gas to determine if it's worth it. Plus I like American Express customer service.

I use that in conjunction with a BOA 3%/2%/1% card which I typically only use at places that don't take AmEx. I'm not sure if it's the most optimal CC combo, but it has worked decent so far.
The Dark Knight wrote:Ladygeek provided good background info.

I don't know about sign-up bonuses and such, but if you do your research you should get the answers to that fairly quickly.

I can share the cards I use to max my cash back:

(1) Blue Cash Preferred : I think that's what it's called. Basically I get 6% groceries, 3% department store, 3% gas. There's an annual fee, but I think I calculated that I get more from this card than the lower tiered no-fee version if I spend more than $2500/yr on groceries (I do).

(2) Fidelity Amex: 2% on everything

(3) Chase Freedom/ Discover: 5% on revolving categories that change every 3 months. For example, I believe right now it's gas.

With these cards, I think I cover nearly all of my spending at greater than the usual 1% you'd get. Some folks also get the Penfed card that gets 5% on gas. I personally don't use that one cause I don't drive a lot, plus I'm happy with the 3% I get from Amex and the occasional 5% from the rotating cards, so don't feel need to add another cards.
These are good suggestions.

I spend around $3000 on groceries and about $1500 on gas each year. Total savings (above and beyond the 1% I presently get), would be $180 - $75 annual fee = $105 per year for the AMEX card. May be worth considering.

I'd really be interested in the upfront bonus for signing up. Looks like the sign up bonuses aren't quite as good as they used to be. They are only offering $100 now, and I believe they used to offer $300.
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Re: Best Cash Back Credit Card?

Post by Tyrobi »

  • 5% - Penfed Visa for Gas
    5% - Target Visa for Target
    3% - Amazon Visa for Amazon
    1.5% - CapitalOne Cash for Sam's Club and everything else.
Last edited by Tyrobi on Fri Jul 06, 2012 2:33 pm, edited 1 time in total.
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runnergirl
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Re: Best Cash Back Credit Card?

Post by runnergirl »

6% groceries - Amex Preferred cash (can buy gift cards to Home Depot, Lowes, and many stores at grocery store)
5% gas - PenFed
5% restaurants, movies, bookstores (incl everything at Amazon), video rentals - Citi Forward
1.5% everything else - Capital One Preferred
FedGuy
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Re: Best Cash Back Credit Card?

Post by FedGuy »

runnergirl wrote:5% restaurants, movies, bookstores (incl everything at Amazon), video rentals - Citi Forward
Just a note about this: the Citi Forward card gives you Thank You Points, not cash. You can convert them to cash, or gift certificates, or various other things, but not always at a favorable rate. Your ability to actually get 5% cash back out of this card depends on what rewards you're interested in and how many points you have to convert (that is, sometimes you get a better conversion rate if you horde your points until you reach a higher point total).

It also assumes that the points don't expire before you cash them in, that Citi doesn't discontinue the reward you're saving for or increase the amount of points you need to get it (both of which they've done in the past), and that you don't end up forfeiting your points by closing the card or something similar.
leod
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Re: Best Cash Back Credit Card?

Post by leod »

combination of:
- amex preferred cash
- for everything else including sams/costco there's mastercard
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Ketawa
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Re: Best Cash Back Credit Card?

Post by Ketawa »

Try out NerdWallet; you can input your spending patterns and preferences, and it will determine which cards might be best for you.
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interplanetjanet
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Re: Best Cash Back Credit Card?

Post by interplanetjanet »

To add to the previous cards mentioned -

If you fly a lot, the Penfed Travel Rewards Amex gets an effective 8% back on airfare if you spend the points earned on more airfare - you get 5 points per dollar, and each point is worth about 1.6 cents when redeemed for airfare. 20k bonus points for spending $650 in three months (worth around $320 towards a plane ticket).

The Blue Cash Preferred is great if you buy a lot of groceries - we spend around $10k a year on food and gas and it's good for $500+ cash back every year, after subtracting the annual fee.

Chase Sapphire I think still has a signup bonus worth around $400 for $3k spend, Citi ThankYou Premier recently had one worth around $500 for the same (though that's $500 of Amazon gift cards or similar, which while not quite as good as cash is pretty close in my book). Ongoing bonuses aren't great and they have annual fees after the first year, so they might not be a great long term choice.

I'm going to check out the Citi Dividend Platinum Select - if they continue their current pattern, they have a 5% cash back offer every quarter with a $300 cap annually, and have had that 5% offered on utility payments in Q1. If they keep it up, I'll just prepay my utilities for the year in Q1, which conveniently is around $6k total, for $300 back each year...or at least until they change the 5% schedule. High cash back on utility payments is rare, my Juniper/Barclays Mastercard at 2.5% effective was the best I'd found until this.

-janet
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hAvAAck
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Re: Best Cash Back Credit Card?

Post by hAvAAck »

Tyrobi wrote:
  • 3% - Amazon Visa for Amazon
Citi Forward does 5% on bookstores (Amazon) in case you weren't aware.

I stick with Fidenlity Amex 2% and Priceline Visa 2%. Right now I'm in a churn so I'm working on spending bonuses.
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Re: Best Cash Back Credit Card?

Post by Carl53 »

interplanetjanet wrote: I'm going to check out the Citi Dividend Platinum Select - if they continue their current pattern, they have a 5% cash back offer every quarter with a $300 cap annually, and have had that 5% offered on utility payments in Q1. If they keep it up, I'll just prepay my utilities for the year in Q1, which conveniently is around $6k total, for $300 back each year...or at least until they change the 5% schedule. High cash back on utility payments is rare, my Juniper/Barclays Mastercard at 2.5% effective was the best I'd found until this.

-janet
Anybody have experience with this Citi card to know what the utility types that jave in the past been included with this card. Is it just water, gas and electric? or are cell phones, cable, directv etc also included? If it is just the three basic I'd be only at half of the bonus utilization. I see that it does have a $150 sign on bonus. The current quarter is airline, car rental and certain clothing stores.

Currently in transition on cc cards.
5% gas PenFed Visa in form of visa cash card
2% misc Priceline Visa instant credit to items on bill (this one is the newest in the portfolio)
6% groceries on AMEX Blue Preferred credit to bill (this is the next card to be replaced due to the fee. Plan to go with the Sallie Mae Cash Back Visa - 5% back on groceries up to $500/month. I have found our grocery shopping to be well under this typically except when I by gift cards for home improvement stores.)

Relegated to the drawer was the BP Visa after they changed their terms.
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Re: Best Cash Back Credit Card?

Post by Sheepdog »

CC PROMOTIONS:
AARP-Chase no-fee Visa http://www.aarpcreditcard.com/Default?CELL=6C1L offers $100 reward for the 1st use then 3% back for all travel (airline, cruises, hotels, auto rental etc.), 1% back on everything else with no limit.

Priceline.com no-fee Visa https://www.pricelinevisa.com/ offers $50 reward after 1st use, 2% back on all purchases with no limit.

TD Cash Rewards no-fee Visa http://www.tdbank.com/personalcreditcar ... scard.html# offers for the 1st 6 months 5% back on dining, grocery, gas purchases and cable, phone and utility bills. After that 1% on everything
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interplanetjanet
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Re: Best Cash Back Credit Card?

Post by interplanetjanet »

Carl53 wrote:
interplanetjanet wrote: I'm going to check out the Citi Dividend Platinum Select - if they continue their current pattern, they have a 5% cash back offer every quarter with a $300 cap annually, and have had that 5% offered on utility payments in Q1. If they keep it up, I'll just prepay my utilities for the year in Q1, which conveniently is around $6k total, for $300 back each year...or at least until they change the 5% schedule. High cash back on utility payments is rare, my Juniper/Barclays Mastercard at 2.5% effective was the best I'd found until this.

-janet
Anybody have experience with this Citi card to know what the utility types that jave in the past been included with this card. Is it just water, gas and electric? or are cell phones, cable, directv etc also included? If it is just the three basic I'd be only at half of the bonus utilization. I see that it does have a $150 sign on bonus. The current quarter is airline, car rental and certain clothing stores.
My experience with my Barclays card is that anything coded as "utilities" qualifies, I'd expect the same to be true with the Citi card. I believe my cell phone and directv payments are billed as such, while my ISP and VOIP provider are not.

Utilities can also be useful for when you need to make a minimum spend on a credit card to get a signup bonus, assuming no onerous fees. I've done $3k payments to my electric and natural gas bill at times, knowing the credit with them will get spent.

$300 back on $6k of spending prepaid for a year is what, a 10% APR, tax-free? The average dollar is held up for 6 months relative to what it would be paying month by month, so I think that's right.

-janet
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Re: Best Cash Back Credit Card?

Post by NMK1 »

I have the AMEX Blue Preferred and the Chase Freedom card.

The Blue Preferred has a $75 charge, but if you spend as much as we do on groceries, the 6% is the best deal out there. 3% cash back on gas and department stores is great as well. I drive a lot and buy a lot of groceries so for me the AMEX is the perfect card. Plus, if you get one now you get $150 bonus for spending 1K in 3 months so your first 2 years are no fee. The Blue Everyday card offers 3% groceries, 2% gas, 1% others and no annual fee. That's pretty sweet as well.

The Chase Freedom is nice, but I'm not too big of a fan of rolling rewards categories. The AMEX is my work horse and the Chase is for when AMEX is not accepted or the Freedom rolling rewards hits a good category for me. They are offering 5% on gas now so that is my gas card for the next 3 months. Freedom is offering $100 cash bonus now, it was $200.

I used this site when researching cards.

http://www.dailymarkets.com/cash-back-credit-cards/
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Re: Best Cash Back Credit Card?

Post by pc95 »

Wow Janet, $6000 in utilities? ouch.......

Anyway, can anyone comment more on the Fidelity Amex? Thinking to replace my Hilton Amex with this and planning possibly to use the fidelity amex in country with Capital One Rewards internationally for the no added fees.
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Re: Best Cash Back Credit Card?

Post by Default User BR »

pc95 wrote:Wow Janet, $6000 in utilities? ouch.......
I believe she is advocating paying ahead. The utilities will maintain the balance, subtracting new charges as they accrue.


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Re: Best Cash Back Credit Card?

Post by MoneyOCD »

Amex Blue cash preferred - 6% groceries + tons of GCs (including Visa ones which I used to pay child's summer tuition :D) , 3% dept stores, 3% gas, 1 % everything else
Citi Forward - 5% restaurants, bookstore/Amazon, movies (redeem TYP for mortgage payment - true 5%)
Fidelity Amex- 2% on everything else, works very nice, as soon as I get $50 I transfer money to Fidelity checking account which linked to my regular checking account.

Really like Citi Dividend Platinum Select, got $200 bonus for opening one and spending $500 in the first 3 month.
Also got 5% back on Utilities in Q1 that included water, gas, electric, phone, cell phone, TV/internet provider- I prepaid about a year worth of those, got my 5% back which is much better then $$ sitting in ING saving account.
Currently it is 5% for airlines, car rentals and Gap/Banana republic stores - not bad either.
Looks like $200 bonus offer is still alive
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Re: Best Cash Back Credit Card?

Post by interplanetjanet »

Default User BR wrote:
pc95 wrote:Wow Janet, $6000 in utilities? ouch.......
I believe she is advocating paying ahead. The utilities will maintain the balance, subtracting new charges as they accrue.
$6k/yr is also kind of ugly for utility prices, but I look on the bright side: after housing and food, they're my next largest expense category and everything after that is small by comparison. Electricity prices here are high and I regularly pay $300-400/mo for electric & natural gas, but at least part of that is because I work from home (higher energy consumption). It stings a bit less when I realize I'm spending <$50/mo on gasoline, when many people spend quite a bit more.

This doesn't include the $175/mo or so I pay for water+sewer+garbage, I can't charge that on a CC. It's usage based but even with zero usage the bill would still be about $150/mo for the sewer connection and garbage pickup.

-janet
masteraleph
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Re: Best Cash Back Credit Card?

Post by masteraleph »

interplanetjanet wrote:To add to the previous cards mentioned -

If you fly a lot, the Penfed Travel Rewards Amex gets an effective 8% back on airfare if you spend the points earned on more airfare - you get 5 points per dollar, and each point is worth about 1.6 cents when redeemed for airfare. 20k bonus points for spending $650 in three months (worth around $320 towards a plane ticket).

Just as a heads' up- you can't get that rate anymore. The rate seems to be running at about 1.1 cents/point at the moment. That's what they're displaying on the rewards website, and it's been noted at FlyerTalk and elsewhere.

With that said, it's still a pretty good travel rewards card, and doesn't have a foreign exchange fee, which can be useful in its own right.
twacapt
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Re: Best Cash Back Credit Card?

Post by twacapt »

Why would any Boglehead pay $75 or so annual fee for American Express, or any credit card? That's like paying an up-front load for a mutual fund. Plus, American Express is not accepted at a lot of retail outlets because of their high fees.

I use the Pen-Fed Visa....no annual fee.... (5% back on gas and 3% back on groceries). At $3/gal gas, that's $ 0.15 per gallon off.

For everything else, it's Capital One Master Card (1.5% back)
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Re: Best Cash Back Credit Card?

Post by Mudpuppy »

twacapt wrote:Why would any Boglehead pay $75 or so annual fee for American Express, or any credit card? That's like paying an up-front load for a mutual fund. Plus, American Express is not accepted at a lot of retail outlets because of their high fees.
If you buy a sufficient amount of groceries, getting a 6% reward instead of 3% can pay for the fee in and of itself over the year. For those who don't buy this much food, it does not make fiscal sense. For those that do purchase this much food, not taking advantage of the extra reward percentages that pay for the fee (and then some) is like not contributing up to the max for your 401k account. You're leaving free money on the table.

Also, I have had no issue using the original AmEx Blue (I don't purchase enough groceries for the Preferred to make sense) at grocery stores here. Even the smaller CA chain store has no problems taking AmEx. In fact, the only merchant who hasn't taken AmEx in the past year was the local company that replaced a segment of my fence last year. The idea that AmEx is not widely accepted is a bit antiquated these days.
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Re: Best Cash Back Credit Card?

Post by grabiner »

twacapt wrote:Why would any Boglehead pay $75 or so annual fee for American Express, or any credit card? That's like paying an up-front load for a mutual fund.
No, because the fee is paid for specific benefits which may be worthwhile. I would prefer to pay $85 for a $300 benefit than nothing for a $150 benefit. (And that's about what I get with my current card, because I have a United card and regularly fly out of Newark, a United hub.)
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Nathan Drake
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Re: Best Cash Back Credit Card?

Post by Nathan Drake »

twacapt wrote:Why would any Boglehead pay $75 or so annual fee for American Express, or any credit card? That's like paying an up-front load for a mutual fund. Plus, American Express is not accepted at a lot of retail outlets because of their high fees.

I use the Pen-Fed Visa....no annual fee.... (5% back on gas and 3% back on groceries). At $3/gal gas, that's $ 0.15 per gallon off.

For everything else, it's Capital One Master Card (1.5% back)
Because the benefits vastly outweigh the cost of the fee?

I just went with the AMEX card.

Nearly all of my major expenses (outside of rent) are for groceries and gas. 6% off something that constitutes 25%+ of my expenses is huge.

I will keep my Visa for times when my AMEX isn't accepted, but by switching to the Blue Cash Preferred Card, I triple the amount of cash back I receive each year (net of fees) compared to my Visa.
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Re: Best Cash Back Credit Card?

Post by FedGuy »

Mudpuppy wrote:
twacapt wrote:Why would any Boglehead pay $75 or so annual fee for American Express, or any credit card? That's like paying an up-front load for a mutual fund. Plus, American Express is not accepted at a lot of retail outlets because of their high fees.
If you buy a sufficient amount of groceries, getting a 6% reward instead of 3% can pay for the fee in and of itself over the year.
The break-even point is $2500 per year, which is about $208.33 per month. That's hardly an unreasonable amount of spending on groceries, particularly for those with families. If you spend anything more than that, you're better off with the Preferred card than with the Everyday card.
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Re: Best Cash Back Credit Card?

Post by pc95 »

I see, Janet, you work from home.....hence a magnified bill.
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Re: Best Cash Back Credit Card?

Post by pc95 »

[quote="twacapt"]Why would any Boglehead pay $75 or so annual fee for American Express, or any credit card? That's like paying an up-front load for a mutual fund. Plus, American Express is not accepted at a lot of retail outlets because of their high fees.

I use the Pen-Fed Visa....no annual fee.... (5% back on gas and 3% back on groceries). At $3/gal gas, that's $ 0.15 per gallon off.

For everything else, it's Capital One Master Card (1.5% back)[/quote]


Yes, I have the same cards, but am now looking to also add in that fidelity 2% card for local, keeping the Capital One Card for International.
pc95
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Re: Best Cash Back Credit Card?

Post by pc95 »

Nathan, Groceries are 25% of your expenses?..hmm....that would make sense if you're in retirement. Maybe out of context - our groceries are 9% of expenses.
tj218
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Re: Best Cash Back Credit Card?

Post by tj218 »

So how much of a credit score hit would I get to open a new card ? The AMEX Blue Preferred looks great, but we are looking to buy a house (hence mortgage) and don't want to ding our credit score too much.

For example sake, my credit score is 740. Will it drop it 10 points or more?
NMK1
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Re: Best Cash Back Credit Card?

Post by NMK1 »

Nathan Drake wrote:
twacapt wrote:Why would any Boglehead pay $75 or so annual fee for American Express, or any credit card? That's like paying an up-front load for a mutual fund. Plus, American Express is not accepted at a lot of retail outlets because of their high fees.

I use the Pen-Fed Visa....no annual fee.... (5% back on gas and 3% back on groceries). At $3/gal gas, that's $ 0.15 per gallon off.

For everything else, it's Capital One Master Card (1.5% back)
Because the benefits vastly outweigh the cost of the fee?

I just went with the AMEX card.

Nearly all of my major expenses (outside of rent) are for groceries and gas. 6% off something that constitutes 25%+ of my expenses is huge.

I will keep my Visa for times when my AMEX isn't accepted, but by switching to the Blue Cash Preferred Card, I triple the amount of cash back I receive each year (net of fees) compared to my Visa.
Good move. That's what I did and the AMEX is worth the fee if you buy a lot of groceries and gas. No better deal out there. Plus, with the $150 bonus it pays two years of fees. 6% vs 3% groceries adds up way more than $75 if you buy a lot.

Just FYI..Pay attention to the type of gas stations you go to fill up or you won't get the points. Example - My wife got gas at a Wawa by her work and we didn't get the points since it does not register as a gas station. Go into your online account and monitor which stations do not show as gas stations. We found a couple that do not have a gas station merchants code.
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Re: Best Cash Back Credit Card?

Post by vesalius »

tj218 wrote:So how much of a credit score hit would I get to open a new card ? The AMEX Blue Preferred looks great, but we are looking to buy a house (hence mortgage) and don't want to ding our credit score too much.

For example sake, my credit score is 740. Will it drop it 10 points or more?
I would not do it until after the mortgage is closed. Particularly if your score is at or near 740, which is the cutoff some lenders use for the best rates.
Last edited by vesalius on Tue Jul 03, 2012 11:08 am, edited 1 time in total.
tj218
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Re: Best Cash Back Credit Card?

Post by tj218 »

vesalius wrote:
tj218 wrote:So how much of a credit score hit would I get to open a new card ? The AMEX Blue Preferred looks great, but we are looking to buy a house (hence mortgage) and don't want to ding our credit score too much.

For example sake, my credit score is 740. Will it drop it 10 points or more?
I would not do it until after the mortgage is closed. Particularly if your score is at or near 740, which the cutoff some lenders use for the best rates.
Thanks. How long should I expect the ding to the credit score to last when I open it?
vesalius
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Re: Best Cash Back Credit Card?

Post by vesalius »

tj218 wrote:
vesalius wrote:
tj218 wrote:So how much of a credit score hit would I get to open a new card ? The AMEX Blue Preferred looks great, but we are looking to buy a house (hence mortgage) and don't want to ding our credit score too much.

For example sake, my credit score is 740. Will it drop it 10 points or more?
I would not do it until after the mortgage is closed. Particularly if your score is at or near 740, which the cutoff some lenders use for the best rates.
Thanks. How long should I expect the ding to the credit score to last when I open it?
Not sure, but a quick google search turned up the answers below, I am not sure of the validity of the time frame given under #1.

Your FICO will drop for at least 2 reasons:

1. You have a new inquiry on your report.

Inquiries stay on your report for 2 years and count into your FICO for 1. So in 1 year your score will go up.

2. Your new account has lowered your average age of accounts.

You didn’t mention what other accounts you have, but the older they are the bigger the hit your score will take. For example say you had 2 other cards, and they are 6 and 8 years old. That makes average age 7 years. Throw a new card into that mix and age drops to just over 4 1/2. The only way to improve this is just to wait it out and let the card age.
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Re: Best Cash Back Credit Card?

Post by mickeyd »

These recurring threads about which CC is best remind me of old threads years ago about which MMF/online bank is the best (back in the 5% days). My thinking is just to pick one or two card(s) and stay with them because they all change after their marketing department has scooped up enough new folks with their campaign.

I started using DC about 25+ years ago when they first started (I think there was a 2% cashback on all purchases then) and they are still our CC of choice. Not the best current kickback scheme, but I still get back about $500 annually from them. Not unlike index funds.
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rb6p
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Re: Best Cash Back Credit Card?

Post by rb6p »

I just got the salle mae card, which has no annual fee and gives back 5% on groceries, gas, and books. This does (I'm told) include amazon. For everything else I use the Amex fidelity card, which also has no annual fee and gives back 2% on everything.

Just about everyone who has posted so far would benefit more from this combination. The only scenario in which the amex blue (with $75 annual fee) would be better is if you were to spend over $7500 in groceries per year. You would likely need to spend even more than this when you account for the advantage of the 5% on books/ amazon and gas.

The Amex fidelity is also (at least to me) a no brainer, regardless of whether you pick the sallie mae or the amex blue. The 2% goes directly into a cash account, which you can link to your regular checking account. As an unexpected perk, I just found out that this cash account is excellent for oversees travel. It will reimburse you for atm fees and has the minimum % transaction fee for atm withdrawals in europe.
pc95
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Re: Best Cash Back Credit Card?

Post by pc95 »

[quote="rb6p"]I just got the salle mae card, which has no annual fee and gives back 5% on groceries, gas, and books. This does (I'm told) include amazon. For everything else I use the Amex fidelity card, which also has no annual fee and gives back 2% on everything.

Just about everyone who has posted so far would benefit more from this combination. The only scenario in which the amex blue (with $75 annual fee) would be better is if you were to spend over $7500 in groceries per year. You would likely need to spend even more than this when you account for the advantage of the 5% on books/ amazon and gas.

The Amex fidelity is also (at least to me) a no brainer, regardless of whether you pick the sallie mae or the amex blue. The 2% goes directly into a cash account, which you can link to your regular checking account. As an unexpected perk, I just found out that this cash account is excellent for oversees travel. It will reimburse you for atm fees and has the minimum % transaction fee for atm withdrawals in europe.[/quote]


rb6p, where is this salle mae card that gives 5% on groceries w/ no annual fee? Do you have a link for it thanks?
rb6p
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Re: Best Cash Back Credit Card?

Post by rb6p »

Wow - looks like they are no longer accepting new applications. The application site I used is down, and after speaking to the customer representative just now, it turns out they will be making changes to the card before making it available to new customers.

I cannot post link as I am new. Google "fat wallet and sallie mae credit card" for a 9 page discussion on this.
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grabiner
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Re: Best Cash Back Credit Card?

Post by grabiner »

tj218 wrote:So how much of a credit score hit would I get to open a new card ? The AMEX Blue Preferred looks great, but we are looking to buy a house (hence mortgage) and don't want to ding our credit score too much.

For example sake, my credit score is 740. Will it drop it 10 points or more?
Independent of the score, some banks will not give a mortgage if you have opened a new credit card in the last 90 days, so I wouldn't recommend opening a card within those 90 days regardless of your score.

So when are you planning to get the mortgage? If it is more than a year out and you have only one or two cards now, opening a new card (and keeping your balances low) might even improve your score. (If the site which gave you your credit score has a simulator, you can use it, but note that the simulator on Credit Karma is broken; at least, it gives me the same estimated score for paying my cards on time for any time period from 3 months to 24.)
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mike143
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Re: Best Cash Back Credit Card?

Post by mike143 »

Grocery and $500 VISA Gift Cards every two weeks: 6% AMEX Blue Cash Preferred
Gas: 5% PenFed (and GasBuddy smartphone app to get the cheapest gas)
Other: 2% Fidelity AMEX or Priceline VISA

I use the $500 gift cards on everything I can, which yields 5% after the card fee.
Nothing is free, someone pays...You can't spend your way to financial freedom.
stan_the_man
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Re: Best Cash Back Credit Card?

Post by stan_the_man »

NMK1 wrote:
Nathan Drake wrote:
twacapt wrote:Why would any Boglehead pay $75 or so annual fee for American Express, or any credit card? That's like paying an up-front load for a mutual fund. Plus, American Express is not accepted at a lot of retail outlets because of their high fees.

I use the Pen-Fed Visa....no annual fee.... (5% back on gas and 3% back on groceries). At $3/gal gas, that's $ 0.15 per gallon off.

For everything else, it's Capital One Master Card (1.5% back)
Because the benefits vastly outweigh the cost of the fee?

I just went with the AMEX card.

Nearly all of my major expenses (outside of rent) are for groceries and gas. 6% off something that constitutes 25%+ of my expenses is huge.

I will keep my Visa for times when my AMEX isn't accepted, but by switching to the Blue Cash Preferred Card, I triple the amount of cash back I receive each year (net of fees) compared to my Visa.
Good move. That's what I did and the AMEX is worth the fee if you buy a lot of groceries and gas. No better deal out there. Plus, with the $150 bonus it pays two years of fees. 6% vs 3% groceries adds up way more than $75 if you buy a lot.

Just FYI..Pay attention to the type of gas stations you go to fill up or you won't get the points. Example - My wife got gas at a Wawa by her work and we didn't get the points since it does not register as a gas station. Go into your online account and monitor which stations do not show as gas stations. We found a couple that do not have a gas station merchants code.
FWIW -- All the Wawas that I have been to code as Gas Stations for gas purchases.
stan_the_man
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Re: Best Cash Back Credit Card?

Post by stan_the_man »

pc95 wrote:
rb6p wrote:I just got the salle mae card, which has no annual fee and gives back 5% on groceries, gas, and books. This does (I'm told) include amazon. For everything else I use the Amex fidelity card, which also has no annual fee and gives back 2% on everything.

Just about everyone who has posted so far would benefit more from this combination. The only scenario in which the amex blue (with $75 annual fee) would be better is if you were to spend over $7500 in groceries per year. You would likely need to spend even more than this when you account for the advantage of the 5% on books/ amazon and gas.

The Amex fidelity is also (at least to me) a no brainer, regardless of whether you pick the sallie mae or the amex blue. The 2% goes directly into a cash account, which you can link to your regular checking account. As an unexpected perk, I just found out that this cash account is excellent for oversees travel. It will reimburse you for atm fees and has the minimum % transaction fee for atm withdrawals in europe.

rb6p, where is this salle mae card that gives 5% on groceries w/ no annual fee? Do you have a link for it thanks?
Just be forewarned, the Sallie Mae 5% card caps your cash back for the bonus categories. I don't have the terms because I don't have the card, but I know that was discussed at Fat Wallet.
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TomatoTomahto
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Re: Best Cash Back Credit Card?

Post by TomatoTomahto »

FedGuy wrote:
Mudpuppy wrote:
twacapt wrote:Why would any Boglehead pay $75 or so annual fee for American Express, or any credit card? That's like paying an up-front load for a mutual fund. Plus, American Express is not accepted at a lot of retail outlets because of their high fees.
If you buy a sufficient amount of groceries, getting a 6% reward instead of 3% can pay for the fee in and of itself over the year.
The break-even point is $2500 per year, which is about $208.33 per month. That's hardly an unreasonable amount of spending on groceries, particularly for those with families. If you spend anything more than that, you're better off with the Preferred card than with the Everyday card.
Man, with two teenagers (and their friends), I can only wish we paid $208 per month in groceries. I'm away from my PC on vacation, but IIRC it's more like $700 per month. All told, I get something like $1000 per year back from Amex (I know, we spend too much). My Discover and Visa cards mostly languish in my wallet, used only when Amex isn't accepted. I wish that I'd switched to Preferred earlier, but I had the BH view that annual fees are the boogeyman.
Okay, I get it; I won't be political or controversial. The Earth is flat.
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Nathan Drake
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Re: Best Cash Back Credit Card?

Post by Nathan Drake »

pc95 wrote:Nathan, Groceries are 25% of your expenses?..hmm....that would make sense if you're in retirement. Maybe out of context - our groceries are 9% of expenses.
My overall expenses are very, very low, which is why the necessities (like groceries and gas) take up a large portion of my total expenses.
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RyeWhiskey
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Re: Best Cash Back Credit Card?

Post by RyeWhiskey »

I find that a 3 card combo works best for me:

Chase Freedom: 5% back on rotating categories. I only use this card on these cats.
Blue Cash Amex: 3% Groceries, 2% Gas. I use this when the Chase card doesn't apply to these two cats.
Capital One Cash: 1.5% on everything. I use this when the above two don't apply.

Pretty simple (easy to keep track of) and gives me an average of 3.5% on Gas/Groceries year-round, and about 2% on everything else. Can't ask for much more. I don't spend nearly enough on groceries/gas to merit using the Blue Cash Preferred, but if you do it's quite the bargain.
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mrpotatoheadsays
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Re: Best Cash Back Credit Card?

Post by mrpotatoheadsays »

I see no benefit in having credit cards... you like debt? if you miss a payment {by accident} you get reamed. You get tons of junk mail, cold call marketing, spam... and then there is that whole ridiculous FICO thing. I say dump the credit cards and go for a FICO score of zero; show the banks and FICO who's boss.
FedGuy
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Re: Best Cash Back Credit Card?

Post by FedGuy »

mrpotatoheadsays wrote:I see no benefit in having credit cards
I get hundreds of dollars per year in cash back from my credit cards. Some people get thousands.

I consider that to be a "benefit."
Default User BR
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Re: Best Cash Back Credit Card?

Post by Default User BR »

mrpotatoheadsays wrote:I see no benefit in having credit cards... you like debt? if you miss a payment {by accident} you get reamed. You get tons of junk mail, cold call marketing, spam... and then there is that whole ridiculous FICO thing. I say dump the credit cards and go for a FICO score of zero; show the banks and FICO who's boss.
Nonsense. Every major card now provides email notification, so there's little chance of missing one. If you have a good record, the cards will normally forgive one missed payment anyway. You get cash back on purchases. You can opt out of any promotional efforts if you choose.

I put everything I can on the cards.


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mike143
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Re: Best Cash Back Credit Card?

Post by mike143 »

mrpotatoheadsays wrote:I see no benefit in having credit cards... you like debt? if you miss a payment {by accident} you get reamed. You get tons of junk mail, cold call marketing, spam... and then there is that whole ridiculous FICO thing. I say dump the credit cards and go for a FICO score of zero; show the banks and FICO who's boss.
I exploit the credit card companies to the greatest extent. Sign up for a Southwest credit card for $250 cash and/or $400 flight, then cancel it. Purchase $500 VISA gift cards on my 6% cash back card and use it to pay my other bills. I was young and dumb once and they made a S load of money off me. I am just paying it back. :moneybag :sharebeer

I go through ALL mine and my wife's account every week so I am not missing anything. You are an adult you shouldn't be missing bills. I have all my accounts in a tab/bookmark group and open them all up and login to all of them even if I remember I paid the bill last week. I don't care if I get junk mail. I don't get calls and I don't get spam from my creditors.
Nothing is free, someone pays...You can't spend your way to financial freedom.
Tabulator
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Re: Best Cash Back Credit Card?

Post by Tabulator »

mike143 wrote:Purchase $500 VISA gift cards on my 6% cash back card
Does that work at any store? Somehow I thought debit or cash is required to buy those.
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