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How to Pick Cash-Back Cards That Save Money Whenever and Wherever You Shop

Flat rate or tiered? Annual fee or no annual fee? Here's everything you need to know about your next cash-back credit card.

Advertiser Disclosure: At Slickdeals, we work hard to find the best deals. Some products in our articles are from partners who may provide us with compensation, but this doesn’t change our opinions.

You work hard for your money, so it is not unrealistic to want your money to work a little harder in your favor. One way to make your budget go a little farther is to make sure you are always getting a percentage back on your purchases. You need to buy gas and groceries regardless, so why not get rewarded for doing so? That is where the best cash-back cards come in.

How Cash-Back Cards Work

Unlike travel rewards credit cards, you don’t have to be a pro at playing the credit card game to benefit. Cash-back cards are easy to keep track of and user-friendly. These types of cards typically fall in one of the following categories:

  • Flat Rate: A flat-rate card usually offers 1.00–2.50% back on all purchases, whether you buy a trip to Italy or a gallon of milk. The benefit of flat-rate cash back is that you can keep a minimal wallet and have an easier time keeping track of your credit card spending.
  • Tiered: Tiered cards vary the cash-back rewards based on what you purchase. A tiered card might offer a flat 1% cash back on the majority of purchases and 3% back on gasoline spending. Many times, the higher-earning tier is capped. A tiered card can help you earn more, as long as you select a card that rewards you the most for what you spend the most on.
  • Rotating Categories: Credit cards with rotating cash-back categories usually have a set 1% cash-back rate and then a higher rate, like 5% back on select categories. These categories rotate with the quarters of the year. For example, you might earn 5% back on all grocery purchases in the first quarter of the year.

Common Cash-Back Categories

New credit cards are released frequently and some like to gain attention with attention-grabbing cash-back offers, like offering 6% back for your favorite streaming service. Most cards, however, offer cash-back perks in the same core categories:

  • Supermarkets
  • Restaurants
  • Gas stations
  • Transportation
  • Wholesale
  • Entertainment

To find the best cash-back credit card, you need to keep track of your spending. Where do you spend the most money? If you spend more money on restaurants than groceries each month, then look for cards that will give you more back for dining out. If your spending is even throughout the cash-back categories, then a higher, unlimited flat cash-back rate card might be a better choice for your finances.

Best Cash-Back Credit Cards

Regardless if you’re new to earning cash back or you’re a seasoned credit card veteran, you’ll find your next cash-back credit card at Slickdeals. Our credit card deals and promotions guide has dozens of the best credit card offers, and we make it easy to compare cards by cash-back percentage, issuer, sign-up bonus and more. Below you’ll find full reviews of some of the most popular cash-back credit cards within our Slickdeals community.

Cash-back credit cards offer some of the most valuable benefits consumers can want. Their rewards are extremely flexible — you can use cash for just about anything — and many of the best cash-back credit cards don’t charge an annual fee. And, if you’re looking for an introductory 0% APR promotion, you’re more likely to get it with one with a popular cash-back credit card than with a card that offers points or miles.

How to Compare Cash-Back Credit Cards

Not all cash-back credit cards are the same. The card that your friend can’t stop raving about might not be a good fit for your spending habits. Here’s what you need to look at before deciding which card is for you:

  • Annual Fee: If the card has an annual fee, is it worth paying? Some annual fees seem expensive up front, but when you consider how much cash back you receive, along with other perks, you might realize it is worth paying. Remember, even if a card has $1,000 worth of perks that make a $250 annual fee seem worth paying for, it is only worth it if you actually use those perks.
  • Bonus Offer: Sign-up bonuses sweeten the pot. However, make sure you can afford to meet the sign-up bonus. If spending $4,000 in three months will put you into financial hot water, look for a card with a lower bonus offer spending requirement.
  • Redemption: How easy is it for you to redeem your cash back? Look for cards that make it easy to transfer your rewards back to your bank account or that allow you to spend them on Amazon for the same redemption rate.
  • Intro APR: Looking to make a big purchase upfront? A 0% intro APR can save you money on interest and give you more time to pay off your purchases.
  • Special Features and Benefits: Do the cards come with special perks that will save you money throughout the year?
  • Ongoing Rewards: Look for cards with regular opportunities to earn more back rather than choosing a card that only has amazing rewards during the first year.

Pros and Cons of Using a Cash-Back Card

Everything in life has its pros and cons, and cash-back cards are no different. Consider these points before making your decision:

Pros:

  • Simplicity
  • No or Low Annual Fees
  • Low Bonus Requirements
  • Builds Credit

Cons:

  • Lack of Travel Benefits
  • Cash Back Can Expire
  • Low Sign-Up Bonuses
  • Fewer Perks

How To Make the Most of a Cash-Back Card

Once you have decided on the right cash-back card for your wallet, you want to make sure you get the most out of the card. Here are a few tips to increase your perks after approval:

  • Plan to get the bonus. Divide the spending requirement by the sign-up bonus time frame to ensure you are spending enough each month. For example, if you must spend $3,000 in 90 days, plan how you will spend $1,000 each month without messing with your budget. Visit our credit card bonuses guide for more listing of the biggest cash back bonuses.
  • Use the shopping portal. Don’t forget to browse the card issuer’s shopping portal to increase how much cash back you can receive on a purchase. If you were already planning to send your mom flowers for Mother’s Day, you might as well use a vendor through the shopping portal that is offering 10-15% cash back when you use your card.
  • Look for rewards bonuses and multipliers. Keep your eye on special rewards bonuses offered throughout the year. For example, some cards were giving a $100 credit for spending $500 on select cruises.
  • Take advantage of rotating bonus categories. If your card offers rotating bonus offers, then spend a few minutes of planning to capitalize on them each year. For example, if your first quarter bonus category is 5% for groceries, consider spending more on groceries during those first three months. Buy extra pantry staples and meat to deep freeze, so you can shop less in the months to come.

Cash-Back Cards Versus Travel Credit Cards

Cash-back credit cards and travel cards are very similar. With travel-branded credit cards, you will earn more back when you spend on travel-related purchases, such as airfare or hotels. Most travel cards also offer the best reward rate when you redeem your rewards toward travel, either through the credit issuer’s travel platform or by transferring points to a travel partner.

Many times, redeeming travel rewards card points for cash means you are getting a lower cash-back rate. It is wise to know how far points will go toward travel versus cash before redeeming them. Travel credit cards can also come with more travel perks, such as access to airport lounges or travel insurance. With these perks can also come annual fees, so it is best to weigh the fee with the perks before signing up.

When trying to decide which card is best for you, consider how much travel you plan on doing. If you love the idea of traveling but aren’t gung-ho to explore the world just yet, a cash-back card might be an easier card to start with.

More Credit Card Rewards

Credit cards have a reputation for causing people to go into debt. Yet the idea that opening credit cards is a bad financial choice isn’t fair or accurate. You get to decide how you will use your credit cards, just as you get to decide how you’ll use the money in your bank account.

Our card roundups help people maximize their credit card rewards earnings for planned, everyday spending. Here are a few to get you started:

If you feel confident that you can manage your credit cards responsibly (paying on time and in full every month), your accounts can be an asset instead of a burden. A well-managed credit card may help you to establish better credit scores over time and can help you take advantage of some amazing rewards.

While we work hard on our research, we do not always provide a complete listing of all available offers from credit-card companies and banks. And because offers can change, we cannot guarantee that our information will always be up to date, so we encourage you to verify all the terms and conditions of any financial product before you apply.

Eric Rosenberg
Eric Rosenberg is a finance, travel, and technology writer in Ventura, California. He is a former bank manager and corporate finance and accounting professional who left his day job in 2016 to take his online side hustle full-time. He has in depth experience writing about banking, credit cards, investing, business, and other financial topics. When away from the keyboard, Eric enjoys exploring the world and spending time with his wife and little girls. You can connect with him at Personal Profitability or EricRosenberg.com.

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