Since everyone has different spending habits, lifestyles, credit histories and budgets, there is no such thing as a single cash back credit card that satisfies the needs of everyone. That’s why it’s important to weigh the pros and cons of credit cards offering cash back rewards. From earning the highest cash back percentage possible to not paying annual fees; we all have our own priorities.
We acknowledge that many factors come into play, and that you want to choose a credit card with the best perks and rewards for yourself. Take a look at our winning picks (and runners up) for best cash back credit cards of 2016, and let’s see if we can find you something.
Giving Assistant has broken down the top cash back credit card picks into the following categories:
- Best for frequent spending
- Best for flat-rate rewards
- Best for bonus categories
- Best for debt payoff & rewards
- Best for fair/average credit
- Best for students
Best Cash Back Credit Card for Frequent Spending
The Winner: Blue Cash Preferred® Card from American Express
Consumers who use credit cards to satisfy their everyday spending needs tend to benefit the most from a card with the highest cash back rates. The American Express Blue Cash Preferred® Card is an overall winner in 2016 for frequent spenders, as it provides impressive 6% cash back on grocery purchases, and the highest year-round rate on gas and department stores with 3% cash back – beating the cash back rewards of cards found in any other category.
|· Highest cash back rewards for groceries
· Unlimited cash back percentage for gas
· Introductory bonus received in the form of a statement credit
· 0% APR for 15 months on purchases and balance transfers
|· Cardholders pay an annual $75 fee
· Not all merchants accept American Express as widely as Mastercard/Visa
· Excellent credit needed
· Warehouse and superstore purchases are not eligible for high cash back %
American Express Blue Cash Preferred® Card Benefits
American Express Blue Cash Preferred® cardholders earn the highest cash back percentage (6%) when shopping for groceries at major supermarkets and the likes of Safeway, Whole Foods and Trader Joe’s – up to $6,000 per year (and 1% after reaching the cap). The card’s savings continue to flourish at gas stations and select department stores with unlimited 3% cash back, as well as 1% cash back on all other purchases. Earned cash back is referred to as Reward Dollars, which can be redeemed for a statement credit in increments of $25.
Sweetening the pot even further, a $150 introductory bonus is awarded to those who spend $1,000 within the first 3 months of owning the card – also making this one of the highest intro perks of any cash back card currently available – and easily accomplishable when using the card to pay for expenses such as utility bills and the mortgage. Additionally, Blue Cash Preferred® cardholders pay no interest on balance transfers and purchases for the first 15 months.
American Express Blue Cash Preferred® Card Drawbacks
An annual fee of $75 means that cash back rewards don’t start kicking in until after a cardholder has made enough purchases to cover this initial charge. Although the Blue Cash Preferred® Card provides international travelers with chip-enabled technology (which increases the ease of paying for purchases outside of the United States), the 2.7% foreign transaction fee isn’t exactly something to write home about (the typical fee being 3%). The American Express brand also has an additional limitation that Visa and MasterCard does not – it is accepted by fewer merchants.
For those who shop at specialty food markets and various local grocery stores, keep in mind that the 6% cashback may not register at every standalone supermarket of this kind in the U.S.
In a Nutshell: The Blue Cash Preferred® Card from American Express shines with its high cash back percentages, 0% intro APR, and substantial bonus offer. The card is particularly ideal for families, especially large ones looking to stretch every dollar when grocery shopping, and commuting to and from work. To reap the card’s full benefit of 6% cash back at U.S. supermarkets, those who spend $50 or more per week on groceries will reach the $6,000 yearly cap with no problem. Savvy shoppers and avid travelers will also enjoy saving 3% at the gas pump and at popular department stores, such as Nordstrom, Macys and Kohl’s. If you can get past the annual fee, and your favorite merchants accept American Express, consider this card for making the most of your everyday spending habits.
For those who refuse to pay an annual fee but still want some of the same benefits as the Blue Cash Preferred, our runner up, the Blue Cash Everyday Card from American Express surely accommodates. Offering the same 15-month 0% APR, cash back rewards are not as impressive yet still fairly commendable – groceries (3% up to $6,000 per year), gas stations (2%), and 1% on all other purchases. In the first 3 months, you’ll also receive a $100 bonus after spending $1,000.
Best Cash Back Credit Card for Flat-Rate Rewards
The Winner: Citi®Double Cash Card
One of the most unique options in cash back credit cards also happens to offer the best in flat-rate rewards. Especially beneficial for those who don’t typically spend a lot in one particular category, Citi®Double Cash is the only card that pays back twice on all purchases. Cardholders earn 1% as they shop, and another 1% whenever the minimum amount due is paid on time. Overall, the card offers decent cash back opportunities with the ability to maximize rewards.
|· Unique cash back rewards
· No category restrictions or caps
· No annual fee
· Cash back earnings available in check form or deposited directly into your bank account
· 15-month 0% intro APR on purchases and balance transfers
|· Unique cash back rewards
· No category restrictions or caps
· No annual fee
· Cash back earnings available in check form or deposited directly into your bank account
· 15-month 0% intro APR on purchases and balance transfers
Citi®Double Cash Card Benefits
The Citi®Double Cash Card is the only credit card of its kind where you can earn double the cash back on every purchase with no limit – whether you pay the balance in full or over time. Additional benefits associated with the card include no cash back limitations set by caps; no jumping through hoops to fulfill any category restrictions; and no enrollments required for rotating categories. With minimum earnings of $25, cash back rewards are flexible and may go towards a statement credit or gift card, as well as sent via check or direct deposit.
In addition to having no annual fee, cardholders pay no interest on purchases and balance transfers for the first 15 months, which comes in handy when making a large purchase.
Citi®Double Cash Card Drawbacks
If you’re looking for an additional introductory incentive when choosing the Citi®Double Cash Card, receiving a bonus for signing up is not an offer. Global travelers will also find the standard 3% foreign transaction fee less than desirable. Additionally, if you ever decide to take an extended break from using your credit card, keep in mind that cash back rewards expire due to inactivity following a 12-month period of hibernation.
In a Nutshell: The Citi®Double Cash credit card is a rare bird indeed, allowing users to earn cash back not once, but twice on all purchases…and with the luxury of not having to worry about exceeding caps or meeting restrictions. With a more simplified structure that doesn’t consist of remembering different bonus categories, the card is ideal for spenders who do not want to depend on purchasing just groceries and gas in order to earn the bulk of their cash back rewards. Additionally, those who pay their balances in full every month get to benefit from the higher total cash back rate almost straightaway. In addition to double cash back savings, the card comes with no annual fee, 0% intro APR, and convenient flexibility on how you receive your cash back.
We think the Barclaycard CashForward™ World MasterCard® is worth the consideration when you’re looking for one of the best flat rates for cashback-qualifying purchases. Instead of receiving 1% now and 1% later, cardholders earn unlimited 1.5% cash back on all purchases with no categories, no quarterly sign-ups, and no caps to worry about. Although the overall cash back rate is lower than the Citi®Double Cash Card, there is the added perk of a $100 bonus for signing up. The $50 minimum required before cash back rewards can be redeemed may also test the patience of those who prefer quicker returns.
Best Cash Back Credit Card for Bonus Categories
The Winner: Chase Freedom®
Consumers that are versatile in their spending habits stand to benefit the most from a cash back credit card, like Chase Freedom®, which places emphasis on making qualifying purchases belonging to a specific group of rotating categories referred to as ‘bonus categories.’ Depending on the quarter, cardholders may enjoy an impressive 5% cash back rate at gas stations, grocery stores, restaurants, transportation stations and Amazon.com, and 1% for all other non-qualifying purchases.
|·5% cash back on bonus categories
· 0% intro APR for 15 months on purchases and balance transfers
· Introductory bonuses after meeting 3-month qualification
· No annual fee
· Qualify with less-than-excellent credit
· Cash back rewards never expire
|·Cardholders must remember to opt in each quarter to receive 5% cash back
· A cap on purchases in bonus categories
Chase Freedom® Benefits
In terms of versatility, the Chase Freedom® card doesn’t disappoint. By allowing users to earn cash back rewards associated with rotating quarterly categories, the card accommodates a greater range of consumers at any given time. You’ll get 5% cash back on your combined qualifying purchases (up to $1,500), and unlimited 1% cash back on all other purchases that automatically kick in outside of the bonus category bubble. From restaurants to gas stations, the rotating bonus categories tend to represent the areas of spending that the typical shopper normally indulges in.
Cash back rewards are redeemable in a handful of ways, such as buying merchandise, exchanging for gift cards, booking travel, Amazon.com purchases, statement credits, or simply cashing them out via direct deposit to your bank account.
In addition to earning a $150 sign-on bonus for spending $500 on purchases within the first 3 months of opening the account, Chase Freedom® cardholders can also earn a $25 incentive after adding an authorized user and making a purchase during this same time period.
Chase Freedom® Drawbacks
The Chase Freedom® is not for someone who prefers low-maintenance cash back cards, or who doesn’t want to fuss with bonus categories that change every three months. Large families and enthusiastic consumers, which tend to spend more on a monthly basis, may experience fewer long-term rewards than with other cash back credit cards since accumulating $1,500 in bonus category-spending before a quarter ends is pretty easy to do for frequent shoppers. After reaching the cap, the cash back rate drops to 1% for all purchases.
Additionally, it takes effort to make sure you receive 5% cash back in the first place. Although Chase sends out reminders and retroactively awards savings to consumers who opt in late, it is up to you to log into your account every three months to activate the rewards.
In a Nutshell: The Chase Freedom® card provides solid cash back rates in rotating bonus categories that mostly reflect everyday expenses of the average consumer. The card is a good option for those who value long term benefits; introductory bonuses with relatively easy-to-meet requirements; and the ability to receive a little something back without spending a great deal of money. However, Chase Freedom® is not recommended for the extremely busy, forgetful or procrastinator –in other words, those who may neglect opting in the bonus categories in a timely manner, and miss out on an entire quarter worth of 5% cash back opportunities. Since rewards are capped at $1,500, the card is best suited for smaller spenders, and individuals looking to establish their credit history.
You won’t get the added boost of having a signing bonus worth $175, as the U.S. Bank Cash+™ Visa Signature® Card offers no sign-up incentives; however, this card is set with slightly higher spending caps (up to $2,000 instead of $1,500) and the chance to tailor bonus categories to meet spending habits. In addition to getting 5% cash back in two bonus categories that you select (from a list that changes on a quarterly basis), you’ll also earn 2% cash back on your choice off an everyday category (such as groceries, gas or the pharmacy), and 1% elsewhere. The card also grants less time to enjoy 0% APR (9 months on balance transfers), whereas Chase Freedom® cardholders enjoy no interest for 15 months on both purchases and balance transfers.
Best Cash Back Credit Card for Debt Payoff & Rewards
The Winner: Discover it®- Double Cash Back your first year
Being able to earn double cash back within the first year of using a credit card is a welcomed opportunity for individuals looking to reduce their debt while still reaping the benefits of rewards. Although limited by quarterly caps, Discover it®- Double Cash Back pays 5% cash back on purchases made within specific categories that change according to each quarter, as well as endless 1% cash back on all other Discover it® credit card purchases. A generous 0% introductory APR period on balance transfers also increases the appeal of this card.
|· Double cash back feature
· No annual fee, in addition to other fee-based leniencies
· 0% intro APR for limited time on purchases and balance transfers
· Redeem any amount of cash back
· Access to bonus “online mall”
· No foreign transaction fee
|· Not as widely accepted by merchants in the US (and abroad) as Visa/Mastercard
· Quarterly caps can limit heavy spenders
· No bonus for signing up
Discover it®- Double Cash Back your first year Benefits
The 18-month introductory 0% APR period on balance transfers that Discover it®- Double Cash Back offers is currently one of the longest for cash back credit cards in 2016, giving consumers the chance to whittle down their balances before paying extra – all while continuing to accumulate cash back rewards. Cardholders also enjoy 0% APR on purchases for 6 months.
As you earn 5% cash back in categories that change on a quarterly basis (such as gas and ground transportation, restaurants and movies, home improvement stores, department stores and Amazon.com), unlimited 1% cash back is also earned on all other purchases. With cash back that never expires, cardholders can redeem any amount at any time. Another noteworthy highlight of Discover it®- Double Cash Back is gaining access to their online bonus mall, which delivers an additional 5% to 20% cash back on your favorite online retailers.
Discover it® also offers additional perks beneficial to those concerned with debt reduction and their credit history, such as complimentary access to their FICO score, no annual fee, no overlimit fee, and card protection in the form of the Freeze It℠ “on/off switch,” which prevents new purchases, balance transfers and cash advances from taking place on misplaced cards. Also, the first late payment fee on the account is waived for cardholders.
Discover it®- Double Cash Back your first year Drawbacks
While the Discover it®- Double Cash Back card ranks high in options available for debt payoff and rewards, some of the money you save in interest does get lost due to balance transfer fees. The card is also less attractive to those who prefer to own a credit card with a longer 0% APR period for new purchases – six months is one of the briefest offers around. Keeping track of rotating bonus categories means extra effort is needed to make sure you’re maximizing the benefits of your Discover it®- Double Cash Back card. Lastly, heavy spenders and large families may feel restricted by the $1,500 quarterly cap placed on their bonus spending.
In a Nutshell: Discover it®- Double Cash Back is the type of credit card that provides added peace of mind for their consumers with instant card protection, no overlimit fees, and free FICO score reports. Cardholders with frequent and varied spending habits will appreciate the higher cash back rates for rotating categories, while users trying to lessen their overall credit card balances often welcome the lengthy introductory balance transfer APR % with open arms.
Cash back credit cards with longer introductory 0% APR periods are beneficial for individuals looking to reduce debt, in addition to earning cash back rewards. The Citi® Double Cash Card not only pays twice the cash back for the longevity of the card (2% eventually when payments are made), but also offers 0% intro APR on balance transfers and purchases for 15 months.
College-related bills and loans are a primary source of debt for both adults and students, which means it’s worth highlighting the UPromise World Mastercard® as a worthy option. This card caters to individuals saving for their college education, or looking to pay off a college loan. While you won’t get double the cash back, you do receive 0% APR for 15 months on balance transfers; $50 cash back following your first-time use; as well as earn 5% cash back when dining at participating Upromise restaurants; 2% for purchases at eligible department stores and movies, and1% cash back on all other purchases.
Best Cash Back Credit Card for People with Fair Credit
The Winner: Capital One® QuicksilverOne® Cash Rewards
Not everyone possesses a stellar credit history, which can make it difficult to obtain one of the very best cash back credit cards for 2016. Options for those with fair, average or limited credit usually involve weighing the pros and cons of having fewer overall perks in exchange for the ability to earn competitive rewards. Capital One® QuicksilverOne® Cash Rewards provides the opportunity for people with a FICO score in the 630-689 range, new credit cardholders, and those working to repair their credit to earn unlimited 1.5% cash back on every purchase.
|· Qualify with average credit
· One-time cash bonus
· No rotating categories to keep track of
· Cash back does not expire
· Higher credit line possibilities
· 0% intro APR on purchases and balance transfers
|· An annual fee of $39
· Not accommodating for frequent gas and grocery purchases
· No bonus category savings
· Relatively short introductory APR period
Capital One® QuicksilverOne® Cash Rewards Credit Card Benefits
Capital One® QuicksilverOne® Cash Rewards doesn’t discriminate against individuals who are in need of credit-building assistance. In addition to offering a fixed 1.5% cash back rate, there is no worrying about following a schedule for rotating bonus categories – this rate is available for all purchases with no limitations. Also, 0% intro APR on purchases and balance transfers is available until November 2016.
New cardholders enjoy a one-time $100 cash bonus after spending $500 on purchases within the first 3 months of owning the card. Capital One® also does not restrict the amount of cash back you can earn, and rewards do not expire. Once you’ve accumulated cash back, rewards redemption comes in the form of a check, statement credit or gift card, which is redeemable any time you like – no minimum requirements to fulfill.
Capital One® also takes an active role in making sure you enhance your credit history by providing a Credit Tracker that helps monitor your credit score and financial decisions. Additionally, after making the first five monthly payments on time, accounts are reviewed and qualify for a higher credit line with the company.
Both foreign and national travelers will appreciate the perks of this card, as a lack of foreign transaction fees makes global adventures less of a blow to a budget, while Uber riders receive a 20% discount credited to their card account when using QuicksilverOne® to pay for their rides in the U.S. between now and April 30, 2016.
Capital One® QuicksilverOne® Cash Rewards Credit Card Drawbacks
When compared to other cash back credit cards, Capital One® QuicksilverOne® Cash Rewards has a shorter introductory APR period than its counterparts. And while the annual fee of $39 isn’t necessarily a game changer, you will need to spend at least $2,600 per year on the card just to recoup this cost. Additionally, if you purchase a lot of groceries and gas, you’ll find the cash back value less than desirable – especially if you have a large family or commute often.
In a Nutshell: While the Capital One® Quicksilver® Cash Rewards Credit Card’s claim to fame isn’t offering the highest rewards, it does provide an opportunity for people trying to establish or rebuild their credit to own a cash back resource that delivers easy-to-earn rewards and flexible redemption terms. Earning a solid 1.5% back on all purchases, it’s not only one of the best credit cards with low fees in this category, but also offers a quick cash bonus. As a long-term card, you’ll probably want to find something else once you’ve used this card to enhance your overall credit history, and qualify for a card that offers more accommodating rewards.
With the ability to earn unlimited 1% cash back on gas and grocery purchases, Credit One Bank® Cash Back Rewards is our second pick for a cash back credit card that accepts applicants with fair credit. Although you get additional perks, such a zero fraud liability protection, free online monthly credit score tracking and automatic credit line increase reviews, an annual fee of $35-$99 means cardholders must spend more than with Capital One® Quicksilver® Cash Rewards to truly reap cash back benefits.
Best Cash Back Credit Card for Students
The Winners: (TIE) Discover it® and Discover it® Chrome for Students
In between paying for books and buying an airline ticket back home, many students rely on the financial cushion that a credit card provides. Giving an extra boost with double cash back during the first year, the Discover it® for Students line offers two different kinds of cards that provide various ways to earn 2% to 5% cash back in bonus categories that fit specific lifestyles.
|· Qualify with average to excellent credit
· No annual fee, in addition to other fee-based perks
· Bonus cash back for good grades
· 0% APR on purchases for 6 months with lower percentage for balance transfers
· No foreign transaction fee
|· Not all merchants accept Discover
· Small-town college students may have limited stores/shops that accept card
· Time period for introductory 0% APR for purchases is briefer than others
· No sign-up bonus
Discover it® & Discover it® Chrome for Students Benefits
The spending habits and lifestyle of students contemplating between Discover it® and Discover it® Chrome will play an important role in determining the best cash back credit card for college.
- Discover it®: Although students earn generous 5% cash back (on their first $1,500 spent) within bonus categories that rotate, they must also stay diligent in signing up for their Discover it® quarterly bonus, as well as make sure they will actually benefit from what is being offered. The first-year double cash back promotion further increases the appeal of this card. Additionally, 1% cash back is earned on all other purchases.
- Discover it® Chrome: If you’re lucky to have a car on campus, Discover it® Chrome’s 2% cash back on up to $1,000 in combined purchases at gas stations and restaurants is an attractive perk. While you earn less than with Discover it®, the Chrome card is more accommodating to the disorganized, heavy-partiers and/or stressed out students with demanding majors who may forget to sign up for their quarterly perks and miss out on the 5% offered above. Unlimited 1% cash back is earned on every other purchase made; in addition to double cash back associated with the first-year promotion.
For 6 months, students may take advantage of 0% intro APR on purchases, as well as paying a lower 10.99% on balance transfers for the same 6 months with both Discover it® cards.
Also, with the Discover it® for Students cards, it literally pays to get good grades. The card rewards the studious with $20 cash back each school year when they’ve earned a GPA of 3.0 or higher; this perk is granted up to five years that a student is in school.
Cash back rewards are redeemable with no minimum requirements to meet. Some choose to apply the savings toward their statement balance, while others opt to deposit the funds into their bank account. Other perks for both cards include complimentary FICO credit score access, no foreign transaction fees, and no overlimit fees.
Discover it® and Discover it® Chrome for Students Drawbacks
Discover is a credit card accepted by fewer merchants than a MasterCard or Visa; therefore, it is not uncommon to find that smaller stores, like the local Mom & Pop shop off campus, may not accept it. This is something to especially think about if you are located in a smaller college town.
In a Nutshell: The Discover it® and Discover it® Chrome for Students provides an excellent cash back credit card option for college students, especially those who are acing tests and keeping their GPA above a 3.0. When choosing between the two, you have to decide if you’re a person who will benefit and can stay on top of rotating bonus categories despite all of the distractions and stress that comes with higher education. Earning double cash back is always a welcomed bonus, and students do so for an entire year with both cards. The absence of many pesky costs, such as overlimit- and annual fees, also makes the Discover it® brand less stressful than other credit card options for students.
For those with fair, average or limited credit, Journey® Student Rewards from Capital One® is our pick for a decent credit-building option that provides additional rewards to students who diligently pay their balance. The card offers a 1% cash back rewards rate on all purchases that increases to 1.25% with the 25% bonus earned when paying the bill on time each month. Those who study abroad also enjoy no foreign transaction fees.
How We Chose the Best Cash Back Credit Cards for 2016
In addition to analyzing the overall cash back value and percentages of the above-mentioned cards, we took into consideration the following range of factors to help determine the best credit cards– which were then compared to similar options in each category:
- bonus offers, such as introductory perks and sign-up specials
- how cash back is earned
- fixed versus rotating cash back categories
- the length of introductory APR offers
- spending caps, if applicable
- maximum overall cash back you can earn
- cash back expiration terms and redemption options
- the existence or lack of various card fees
- additional card benefits
Lastly, the overall flexibility and resourcefulness of the cards were taken into account. For example, cash back credit cards that allowed uses to earn rewards in popular categories, such as gas, groceries and restaurants, ranked higher simply because they accommodate a greater number of people. Specialized options, such as cash back cards for small businesses and those geared towards people with an account at a specific bank, did not factor into the analysis.